June 23, 2023
For most people, yoga is one of the best wellness activities to pick up during adulthood. Aside from its multiple health benefits, it’s also a practice that anyone can start in the comfort of their own home without the need for lofty equipment. For the same reason, it’s easy to see why so many passionate yogis have turned to the idea of starting a yoga business.
From the outset, a yoga studio seems like it would be a good startup business idea—minimal staffing and equipment required, a growing interest among people, and the potential to cultivate a loyal community focused on wellness and mindfulness.
But just like any other business, opening a yoga studio brings its own challenges, with operational costs being one of the biggest hurdles.
If you're an aspiring entrepreneur eager to understand the fundamental expenses involved.
For starters, opening a 1,000-square-foot yoga studio that can comfortably accommodate up to 25 students can set you back $15,000 to upwards of $100,000, depending on several factors like location, demand, and local competition.1
So what exactly drives these costs? In the next section, we’ll look into the basic operational costs of opening a yoga studio.
Regardless of your business or marketing strategy, rent will most likely make up the largest chunk of your operating costs. Take into account the size of your studio, the location, and the property market value of commercial spaces for lease in the area.
In the United States, retail properties have an average asking price of $23 per square foot. For a 1,000-square-foot studio, expect to pay a base price of $23,000 in lease costs, not including utilities such as electricity, water, heating, and air conditioning.
It’s also worth mentioning that the average asking price for rental costs can rise quickly in premium locations. For example, in the Manhattan area, retail spaces average $57 per square foot, with gross rates increasing to $71 per square foot when factoring in additional expenses such as property taxes, insurance, and maintenance fees.2
Add to this the security deposit that can range anywhere from one to three months’ worth of rent. In some cases, especially for newer businesses or those with less established credit, landlords might even request additional security.
On Amazon, yoga mats range from $15 to $100, but buying wholesale can offer better deals. For example, you can get decent quality mats for around $20 each, totaling $600 for 30 mats—enough for a full class. To set your yoga studio up for success, you’ll also want to invest in these basics:
On average, small businesses pay around $42 per month for general liability insurance. Given that yoga studios often involve physical activity, you may also want to consider professional liability insurance, which costs approximately $61 per month. This policy can protect against claims related to instruction and advice given during classes.3
In addition, if your studio employs staff, workers' compensation insurance is necessary, costing about $45 per month. If you offer online classes or manage client data digitally, cyber insurance might be worth considering at about $145 per month to safeguard against data breaches or cyberattacks.
Generally, a basic business license in the United States will cost between $50 and $550, depending on local regulations and type of permit required.4 This license ensures that your business complies with local zoning laws and other operating standards.
In addition to a business licence, you may need to apply for permits based on your studio's specific activities. For example, if you plan to sell retail items such as yoga mats or clothing, a seller's permit may be required.
To operate a successful yoga studio, acquiring the right certifications is crucial. A standard 200-hour yoga teacher training program is the minimum requirement for teaching and generally costs between $1,000 and $3,000. For more advanced qualifications, such as a 500-hour certification, expect to pay between $3,000 and $7,000, depending on the training provider and location.
In addition to yoga training, you might consider offering specialised classes like breathwork. A breathwork training certification is an excellent complement to yoga instruction, and can help with broadening your clientele.
As a startup, you have the option to handle all marketing efforts in-house, which can save money. By leveraging social media, building a website, and creating content yourself, you can significantly reduce costs. However, this approach requires time and expertise in areas like social media strategy, content creation, and digital advertising.
If you choose to outsource your marketing, the costs can vary based on the services you require. For example, outsourcing a social media strategy typically costs between $500 and $2,000 per month, while content creation and scheduling can range from $500 to $2,000 per month. If you opt for paid social advertising, expect to pay around $500 to $2,000 per month for campaigns.5
Yoga instructors can be paid either hourly or salaried, depending on their role and experience. The average hourly rate for a yoga instructor in the U.S. is around $28 per hour, with annual salaries ranging from $43,000 to $58,000.6
In addition to wages, you’ll need to account for payroll taxes, which include Social Security, Medicare, and unemployment taxes, amounting to approximately 7.65% of an employee’s salary. Depending on your studio's budget, you may also offer benefits like health insurance, which can cost an additional $500 to $1,200 per employee per month. Offering benefits helps attract and retain top talent but increases overall staffing costs.
Now that we've covered the basic operational costs, you might be feeling a bit overwhelmed and wondering:
Yoga studios can indeed be profitable, but just like any business, success rides on careful planning, good management, and strategic decisions. On average, yoga studio owners can expect to generate $764,000 annually, with profit margins ranging from 15% to 30%. This means a well-managed studio can make between $152,800 and $229,200 in profit each year.7 However, profitability is heavily influenced by factors such as location, number of students, class sizes, and additional services offered.
For instance, larger studios that accommodate more students tend to be more profitable due to efficient space utilisation. Similarly, offering a variety of revenue streams, such as memberships, teacher training programs, and additional wellness services (e.g., massage or personal training), can significantly boost profitability.
Aspiring studio owners should carefully manage expenses, which include rent, instructor salaries, utilities, and marketing to ensure that expenses do not exceed revenues. When all these elements align, a yoga studio can not only thrive but generate substantial income for its owners.
