Your yoga studio financial model is the foundation of your business. It will help you track your progress, make informed decisions, and ultimately grow your studio.
Your financial plan should include the following three financial statements:
Income Statement
Your income statement should include:
- Revenue: how much revenue you generate.
- Cost of Goods Sold: These are your direct costs associated with generating revenue. This includes labor costs and the cost of any equipment and supplies used to deliver the product/service offering.
- Net Income (or loss): Once expenses and revenue are totaled and deducted from each other, this is the net income or loss
Sample Income Statement for a Startup Yoga Studio
| Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | ||
| Revenue | $100,000 | $120,000 | $145,600 | $164,160 | $185,230 | |
| Expenses | ||||||
| Salaries | $50,000 | $60,000 | $70,600 | $82,160 | $95,230 | |
| Rent | $10,000 | $12,000 | $14,000 | $16,000 | $18,000 | |
| Utilities | $2,000 | $2,400 | $2,800 | $3,200 | $3,600 | |
| Marketing | $3,000 | $4,500 | $6,000 | $7,500 | $9,000 | |
| Total Expenses | $67,000 | $83,900 | $101,400 | $120,260 | $139,860 | |
| Net Profit | $33,000 | $36,100 | $44,200 | $52,960 | $61,680 |
Balance Sheet
Include a balance sheet that shows your assets, liabilities, and equity. Your balance sheet should include:
- Assets: Everything you own (including cash).
- Liabilities: This is what you owe against your company’s assets, such as accounts payable or loans.
- Equity: The worth of your business after all liabilities and assets are totaled and deducted from each other.
Sample Balance Sheet for a Startup Yoga Studio
| Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | ||
| ASSETS | ||||||
| Cash | $10,000 | $10,000 | $15,000 | $20,000 | $25,000 | |
| Accounts Receivable | $3,000 | $5,500 | $6,500 | $8,500 | $10,500 | |
| Prepaid Insurance | $100 | $200 | $300 | $400 | $500 | |
| Office Space & Furniture | $5,000 | $6,000 | $8,000 | $10,000 | $12,000 | |
| TOTAL ASSETS | $18,100 | $22,700 | $31,800 | $41,900 | $51,100 | |
| LIABILITIES & EQUITY | ||||||
| LIABILITIES | ||||||
| Loans Payable | $35,000 | $30,000 | $25,000 | $20,000 | $15,000 | |
| Credit Card Debt Owed | $1,500 | $2,000 | $3,000 | $4,000 | $5,000 | |
| Accounts Payable | $2,000 | $3,500 | $5,500 | $8,500 | $11,500 | |
| Unearned Revenue | $100 | $100 | $100 | $100 | $100 | |
| TOTAL LIABILITIES | $38,600 | $36,100 | $36,600 | $34,600 | $31,600 | |
| EQUITY | ||||||
| Owner Equity / Capital | $18,100 | $22,700 | $31,800 | $41,900 | $51,100 | |
| Retained Earnings | $61,680 | $74,680 | $99,680 | $135,680 | $181,680 | |
| TOTAL EQUITY | $79,780 | $110,380 | $136,380 | $170,490 | $222,790 |
Cash Flow Statement
Include a cash flow statement showing how much cash comes in, how much cash goes out and a net cash flow for each year. The cash flow statement should include:
- Cash Flow From Operations
- Cash Flow From Investments
- Cash Flow From Financing
Below is a sample of a projected cash flow statement for a startup yoga studio.
Sample Cash Flow Statement for a Startup Yoga Studio
| Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | |
| CASH FLOW FROM OPERATIONS | |||||
| Net Income (Loss) | $83,530 | $144,020 | $216,112 | $306,933 | $420,293 |
| Change in Working Capital | ($34,300) | ($12,600) | ($15,200) | ($11,100) | ($21,600) |
| Plus Depreciation | $5,200 | $5,200 | $5,200 | $5,200 | $4,200 |
| Plus Amortization | $0 | $0 | $0 | $0 | $0 |
| Plus Preliminary exp written off | $0 | $0 | $0 | $0 | $0 |
| Net Cash Flow from Operations | $54,430 | $136,620 | $206,112 | $301,033 | $402,893 |
| CASH FLOW FROM INVESTMENTS | |||||
| Fixed Assets | ($25,000) | $0 | $0 | $0 | $0 |
| Intangible Assets | $0 | $0 | $0 | $0 | $0 |
| Net Cash Flow from Investments | ($25,000) | $0 | $0 | $0 | $0 |
| CASH FLOW FROM FINANCING | |||||
| Cash from Equity | $0 | $0 | $0 | $0 | $0 |
| Cash from Debt financing | $154,662 | $0 | $0 | $0 | ($154,662) |
| Net Cash Flow from Financing | $154,662 | $0 | $0 | $0 | ($154,662) |
| Net Cash Flow | $184,092 | $136,620 | $206,112 | $301,033 | $248,231 |
| Cash at Beginning of Period | $0 | $184,092 | $320,712 | $526,824 | $827,857 |
| Cash at End of Period | $184,092 | $320,712 | $526,824 | $827,857 | $1,076,089 |
Appendix
You will also want to include an appendix section which will include:
- Your complete financial projections
- A complete list of your company’s business policies and procedures related to the rest of the business plan (marketing, operations, etc.)
- Any other documentation which supports what you included in the body of your business plan.
Develop a Financial Model
Developing a financial model for your yoga studio is a critical step in ensuring the success of your business. By understanding your costs, revenue streams, and forecasting for growth, you can make informed decisions that will help you grow your studio.