Martial Arts Professional Magazine

Interview by Toby Milroy, NAPMA Vice-President of Sales and Marketing

Joe Borucki is a successful school owner who really understands the unnecessary condition of many martial arts schools because he’s been there. He had erected a number of obstacles (which existed only in his mind) that blocked the growth of his school. He learned how to re-frame his thinking and open his mind to the ideas made available to him as a member of the NAPMA Maximum Impact Program and the Millionaire Wealth Group, and as a Stephen Oliver Coaching client.Now, during this interview, Joe Borucki reveals how he removed himself as an obstacle to his success, the decisions he was no longer afraid to make and the nothing-short-of-amazing responses from parents. He found it quite easy to raise his basic tuition, double his preschool program tuition and boost his upgrades - and it all started with a change of mindset.

Toby Milroy: This month’s NAPMA Success Story is a discussion with Joe Borucki who operates Global Martial Arts in Hampstead, Maryland. He is a NAPMA Maximum Impact member and, during the last year, experienced record enrollment traffic after he moved his school to a busier location and implemented several new marketing strategies, including stronger referral programs.

Joe, let’s start with your martial arts background.

Joe Borucki: I started Hapkido training in early 1985 and am now a Fifth-Degree Black Belt. Prior to that I did, how shall I say it, a little bit of recreational counseling, but my real training started in ‘85, and I have been training steady ever since. I have also trained in Tae Kwon Do, Yudo (Judo), Aikido and various other martial arts styles and a variety of weapons. My current instructor is Grand Master J. R. West who runs the United States Korean Martial Arts Federation. Dr. He-Young Kim, who is quite well known in Korean martial arts, backs Grand Master West. I train with him at least four times a year because he’s in Mississippi and I’m in Maryland.

Toby: Give our readers a brief description of your school.

Joe: I opened my school in Hampstead in 1991. We recently moved to a bigger location a couple of miles up the road. The school is 3,000 square feet, where we train 250 active students.

Toby: The difference between analysis and implementation is one of the most important topics for this interview. I know Master Oliver and the members of the Millionaire Wealth group, of which you’re a charter member, have discussed this topic too.

During the last 36 months, what are the major breakthroughs that you’ve made at your school and the major obstacles that you’ve overcome that would serve as excellent social proof for MAPro readers?

Joe: Implementation of new ideas has been the biggest challenge to overcome. It’s great to have an idea, but if you don’t implement it what good is it? I learned that I had to work on that challenge steadily because new ideas are coming my way all of the time. Master Oliver has helped me with the everyday challenge of enrolling new students.

Toby: The challenge you’ve experienced, Joe, is exactly what business author Peter Drucker has written: a bad idea brilliantly executed is better than a perfect idea that sits on a shelf. Too many NAPMA members suffer from the same challenge. They receive at least one NAPMA package every month (Maximum Impact members receive two!), which is filled with many ideas and methods to generate more enrollments, improve retention and increase upgrades and student quality, but too many of those packages literally sit on shelves, never opened and their potential never realized.

What was your marketing homerun during the last 12 months? What specific idea did you implement that has made a difference at your school?

Joe: It has to be the after-school program, which we call our ASE program, After-School Enrichment. It has been a big boost. We are in every elementary school in the area, which are now five or six schools. The program has brought new students directly, but we also receive second and third referrals, which, in most cases, are through the mothers’ grapevine, word-of-mouth.

Mothers call me and say, “Little Billy’s mom told me about the after-school program and I was very interested in having my son come to your school.” That’s one of the best kinds of free advertising!

I think this kind of community outreach program, which my after-school program really is, is a good idea for smaller schools, without big marketing budgets because it’s very low cost. You still must implement, but you should be able to create a win-win relationship with local daycare centers, elementary schools, recreation centers or private schools. There are many choices.

“Implementation of new ideas has been the biggest challenge to overcome. I had to work on that challenge steadily because new ideas are coming my way all of the time.”

Toby: What paid advertising method has been the biggest hit for you during the last 12 months?

Joe: Direct mail, using Getmembers.com and similar type programs, but your response to this or your response to that is way over the newspaper or any type of mailing. I do the money mailer-type advertising on a consistent basis. To me, that’s name recognition-type of advertising. To generate responses, direct mail is the best way to go.

It’s a little bit more pricey, but if I enroll five or six new students from one mailer, then that more than pays for the price of the mailer.

To put it in dollars and cents, if, for example, I mailed 3,000 direct mail postcards that cost $2,000 and pulled in five enrollments, each with a $400 down payment, then the upfront payments have covered the cost of the marketing.

Toby: Exactly. That’s what called a self-liquidating, regeneration activity. What that means is the upfront fees from the customers pay for the marketing activity and all the back-end continuity revenue that students spend at your schools is all profit from that single marketing activity.

Joe, you said a couple of things earlier that I’d like you to explain in more detail for our readers. You said that you were doing postcard mailings to a cold list, using Getnumbers.com or similar services. They rent you the list and drop your postcard to that list directly. I imagine you’ve picked a household-with-kids list to receive your postcard. Are you doing just a one-time mailing of X number of pieces? Are you separating your mailings into smaller chunks and hitting the list sequentially? What’s been your strategy?

Joe Borucki: The mailing I mentioned earlier was special because it announced the grand opening of our new and larger school. We schedule a series of mail drops to a list of 5,000, if I remember correctly. The response was overwhelming.

I think the fundamental mistake that school owners make, when they use direct mail, is to think one mailing to a list is enough. You must plan a direct mail campaign from the perspective or mindset of the recipient, your prospective customer.

They’re not waiting by the mailbox in breathless anticipation of the marketing and advertising materials and message they may receive. In most cases, your postcard is just one of many pieces in the mail that they quickly sort, looking for mail they deem important. Maybe mom looks at your one-time-only postcard and says to herself, “Oh, karate, we might want to do that.” Even though your message broke through, she could easily put your postcard somewhere and forget it or lose it.

It may take two, three or more mailings to any individual household before the decision maker or the person who could solve a problem, with what you are offering, sees your postcard. Those first two or three could even be thrown in the trash, and it might take a fourth one before mom finally receives your message, realizes how your school will benefit her child and calls you.

The more times you hit that same list, the higher your response rates will be; it’s almost universal. You know the old saying: the squeaky wheel gets the grease; so you need both a good list and multiple mailings to generate a good response rate.

Toby: Did you say the theme or message on the postcard was a grand opening?

Joe: Yes. Since the grand opening was in the spring and then leading into the summer, we had a two-fold message. One was the grand opening of our new location, growing from 2,200 square feet to 3,000 square feet. It was a big jump for us, but it’s a much better location. Second, we incorporated our summer special.

Toby: Typically, when you move to a new location, you experience high-volume traffic initially because people that come to that retail area or drive by it regularly see something new, and it draws their attention.

Next, Joe, please walk us through one or two of the ideas you’ve been considering and the obstacles you perceived and then their reality.

Joe: My first idea was to eliminate the Black Belt Club and implement a Master Club, as my first upgrade. Previously, we were running an orientation or a level-one class and then upgraded students to Black Belt Club at some point in their training. Now, that we’ve eliminated Black Belt Club, we enroll those students straight into either Master Club or Leadership Program early in their training, approximately three to five months.

I struggled with that change because my school had had a Black Belt Club since it opened; however, recently I just did it. I was amazed at the response. I sat with parents to review their kids’ memberships and many of the parents responded to the new Master Club, “Oh, that sounds great!” They upgraded at the drop of a hat. Now I can see that I was an obstacle to my success, again.

I struggled with the implementation of a leadership program, too, until I decided to go for it. The response has been equally amazing.

Another idea that I recently implemented was changing the schedule for our Little Dragon program from once to twice a week, and more than doubling the tuition. The response to that has been just as overwhelming. Our Little Dragon program has steadily grown because I finally decided to face down those obstacles, which were mostly in my head anyway.

Toby: Your experience is exactly what we want to discuss because so many school owners wrestle with the same type of internal struggles constantly. After all, we’re all humans. Members of the Master Oliver’s Coaching group have discovered that the principles are universal. The structure of how things work is universal. The difference is in the school owner’s mindset. The way he or she thinks is either an obstacle or enables him or her to accomplish his or her goals.

Joe: Another one of those obstacles that I’ve learned to overcome is thinking of a student’s advancement or upgrades through their training as linear.

Many schools have a beginner class or trial program, which is a couple of weeks. During that trial period, they enroll those beginners into a basic program of six to 12 months. After they complete the basic program, the instructor or program director will try to enroll those students in either a Black Belt Club or some other type of program. After Black Belt, they’re upgraded to Master Club.

What I’ve learned from Master Oliver is that when your training and upgrade structure is linear, a student’s success rate decreases. The number of students in any one program from which you want to upgrade also decreases because you’re fishing in a much shallower pool.

You only have x number of students, who have earned their Black Belts and you can upgrade to Master Club because of all the attrition. The smart strategy is to upgrade them right away, within 30 to 180 days of their original enrollment in the school. If you upgrade your beginner students right away into either a Master Club or Leadership Program, then, first, their outcomes are better because they’re more committed, mentally, and, second, the attrition rate falls. The retention rate increases dramatically because their expectation is not “I will be in karate in 12 months,” but “I will be a Black Belt” or “a Second-Degree Black Belt.”

The idea is to create a different mindset in your students and their parents that martial arts is part of their life, very similar to a person’s long-term commitment to major athletics: football, baseball and basketball, even tennis and golf, from elementary through high school and even college. Why can’t we train them in martial arts the same way? That type of mentality totally changes the way students will train to make martial arts a part of their lives, as it enhances their lives.

Toby: You hit upon an important detail, Joe, and that is shaping the parent’s mindset too. Expand on your comments about that part of the strategy.

Joe: You must approach the parents from the point-of-view that you are not trying to sell them a program they don’t want for their child. Instead, you want to create excitement and an expectation of the long-term benefits of martial arts, not just the six months of a beginner course. If you tell a student that he or she is in a six-month course and that you’ll discuss the next step after six months, then you are likely setting up that student to fail because you’ve helped him or her to perceive the training as being only six months.

Instead, you want to talk with the student and his or her parents about their goals, and how martial arts can help them realize those goals. You want to create an expectation for the achievement of Black Belt some day. If that student has a motivation issue or tells mom that he or she doesn’t want to go to karate today, then mom has been pre-framed to have the right mindset. She understands that the family has committed to martial arts and working toward a Black Belt. She is more apt to work with you to solve the child’s problem, rather than having the out, “We only have a month left on the six-month program, so we just won’t go.”

It’s a whole different way to think about the advancement of your students, while improving your retention and bottom line. If you can articulate that structure or mindset to the parents early, then they appreciate what you are doing for their child and them because you’re not trying to be deceptive. You’re telling them, “Listen, martial arts is a lifelong activity with lifelong benefits. Enrolling in our Black Belt Club is a four-year commitment, so is that the goal you want for Johnny? Do you think he will benefit from the experience?”

You want to avoid, in fact, discard, the old mentality when you told parents, “We will train your son or daughter to earn a Black Belt.” That is the mindset of martial arts, as just an activity the child does, not one that is enhancing his or her life.

Moving a student to Master Club and a Leadership Program helps to develop a better academic student and a better martial arts student. The child achieves more in other activities and, most importantly, starts the process of becoming a leader. That’s powerful! If you can train a child to be a leader, then there’s no telling what he or she can achieve.

Those are the kind of messages that generate positive responses from parents, instead of, “We’ll make your child a Black Belt.” Parents don’t understand what that means, anyway.

Change the parents’ mindset and the excitement level really rises. It depends on the child, but if everyone adopts the benefits mentality, then parents will back the idea and understand that the training is to benefit the child in a whole gamut of ways: emotional, intellectual and, of course, physical, and not just becoming a Black Belt.

Toby: There was another point that you made earlier that I think our readers would appreciate understanding further; and that is the mental hesitation of many school owners when it comes to having a similar program for the youngest students and charging, appropriately. I think that is a struggle for many school owners. They have a pre-school program or a younger junior’s program, for three- to six-year-olds. Tell us about your old thinking and your new implementation, and the difference you’ve experienced.

Joe: I created, as have many school owners, a false scenario in my head that parents would say no to a higher tuition, before I even asked. That was my old thinking. I was afraid to ask for the tuition, to charge what I deserved, because of that barrier. Finally, I just stepped out of my way and implemented a new tuition structure.

I approached the parents of the students in my preschool program and told them, “Here are the benefits of this program; now I will double them. The classes will be twice a week, so I can add more to the program because we have more time.” They were very excited about the expanded program. The increased tuition was a non-issue. I think one parent gave me a hard time and she still registered her child, anyway. We had 100% of the students jumped onboard with what we did.

Toby: Let me clarify a couple of points for our readers. First, you were masterful in creating a new program for them, into which you could upgrade them. You didn’t say - and this is quite important for our readers -, “Hi, Johnny! You’ve been training for two years at the school and, by the way, tomorrow your tuition is doubled.”

That approach doesn’t work very well. It does works very well, if you create an entirely new structure, a new program, to integrate into your school. Parents have “the option to upgrade their children into your new program.” Of course, since you made it such an overwhelmingly no-brainer decision, everyone upgraded. That’s exactly the right way, a brilliant way, to implement your new preschool program because, like you said, you had almost no push back. The parents’ response was only positive excitement.

I think your key point is that your initial belief system about a preschool program was that parents just wouldn’t pay full tuition for a complete program; when, in reality, you discovered quite the opposite: If you offered them a complete program at the full tuition, then they were more than happy to upgrade. In fact, that’s probably what they wanted initially, right?

Joe: That’s exactly right. I had parents in the past say to me, “You should do this twice a week.” At the time, I thought to myself, “That’s fine, but they’re 4-, 5- and 6-year-olds. Can we do it?” Again, once I moved out of my way, my new preschool program, structure and higher tuition worked just fine. We had better responses.

I went to the instructor of our advanced preschool program and explain the new program. Needless to say, he was on his heels a little bit, but once he started rolling, he jumped onboard and became excited. He’s actually more excited than he was before. Now, he can implement more activities and training and, having more time in class, reduces his stress level because he doesn’t have to squeeze the entire curriculum into one class.

Toby: Although I don’t want to delve too deeply into preschool programs, there is a new trend in the industry that is a perfect example of what I do want to discuss with you next. Some instructors are discovering that it can be of great value for a preschooler, a 4-year-old, for example, with a focus problem, to train with 7- to 9-year-olds, who are very focused. The message is that those with whom you surround yourself, often, determine who you will become. The decisions and behavior of your peers, especially if they are making the right choices and experiencing success, can have a positive effect on your decisions and outcomes.

As a longtime member of Master Oliver’s Coaching program, you’ve had the opportunity to surround yourself with other successful school owners, who have similar mindsets and share your goals. What’s been your experience in the program? What do you value from that environment?

Joe: The Coaching program provides an endless supply of new ideas and also motivates me to implement those new ideas. Whether it’s our meetings or online chats, the big benefit for me has been the resources and discussing results. I am hugely motivated when I see the results from implementing a specific idea or promotion. The Coaching program also keeps me focused on what’s important because all too often petty tasks, such as equipment sales, will sidetrack you, so you’re not focused on student enrollments and keeping your current students happy with their training.

Toby: I’ll remind our readers once again that there are really only four basic tasks or responsibilities that are important at every martial arts school: enrollments, renewals, retention and student quality. The rest are distractions. There are other tasks at a school that require some of your time: accounting, taxes, payroll, etc., but the majority of your focus must be on enrollments, renewals, retention, and quality. If it’s not, then you have major problems.

NAPMA has provided its members and any school owner with the opportunity to experience the same kind of positive group dynamic that you do in the Coaching program, with our Peak Performers and Inner Circle groups. Both operate according to the mastermind model.

Peak Performers are limited to approximately 75 to 80 of the top school owners, who represent 5% of the total NAPMA membership. Inner Circle is limited to 20 members, who are the top 1% of the membership. Both groups have frequent meetings throughout the year and can also discuss ideas and results via the Internet, just as you do with your fellow Coaching members.

Since we started these groups in early 2008, the response has been excellent and many of the Peak Performers and Inner Circle members have already enjoyed many positive experiences and great results at their schools. If any our MAPro readers are interested in more information, then they should visit NAPMA.com/InnerCircle.

Joe: What I’ve learned is that I’m really pumped during the mastermind meetings and return to my school with many great ideas, but once I’m back in my routine, phone calls and discussions with the Coaching members keeps me focused on implementation, so I don’t fall into the same old rut.

It’s like the interaction between Mike Bidwell and Matt Young, who are Mile High Karate school operators. They ask each other, “What are you doing?” That helps them to stay on track and keep their focus new students, retention, renewals and upgrades.

Toby: That’s a good example, Joe, because that interaction is part of the internal Mile High Karate culture. We ask each other, daily, “What are you doing right now?” For example, if a program director is doing computer data entry at 6:00 in the evening, which doesn’t have a direct bearing on enrollment, renewals, retentions, and quality, especially during primetime, then he or she should be focused on students and parents, instead.

As a NAPMA Inner Circle member and Master Oliver Coaching program member, it’s obvious that you are committed to your professional continuing education; and your next step was joining Master Roberts’ Millionaire Wealth group. The focus of that group is to help you grow into multiple schools, create enough wealth and/or reduce your business management time, so you can enjoy a lifestyle of your choosing. Tell us a little bit about your experience in that group.

Joe: It’s helping me reach all three of those goals. I’ve been working for years to open new locations. I’ve been preparing for that expansion and I have instructors who are ready to operate those schools. I’m looking to open another location within 18 months to two years, and then continue to expand into even more new locations. I would like to have three schools during the next five years. I don’t just want those additional locations, but I want them to be able to operate without much input from me, so I have time to concentrate on other wealth-building opportunities. I have the right people and the right training from NAPMA and Master Oliver. It’s time to implement.

My primary goal is to spend more time with my three children. They’re in school all day and I am usually working during the evenings, so I rarely see them and I want to change that. I want my instructors running those schools, with my time reduced to a backup role, instead of being focused on day-to-day operations.

Toby: Being an NAPMA Inner Circle member and Master Oliver Coaching client has certainly helped you develop the mindset for success, Joe. As you know, too many school owners have traveled the same road, without achieving your success goals.

Many of today’s instructors were martial arts students, advanced through the ranks and earned a Black Belt and became instructors because they love martial arts. They may have put themselves through college or earned some supplemental income, teaching part-time. In many cases, their final step was to own a school.

Then, 10 years later, or 20, if they’re lucky, their schools are operating relatively well, providing them with good incomes and relatively enjoyable lifestyles. One day, however, they decide they want to retire or pursue a different activity or career.

Sometimes, they have a hard time making that change because they’re tied to their schools, and they can’t really operate without them. In many cases, those veteran school owners will find highly charismatic or highly talented Black Belt instructors to run their schools. The owners step away from their schools and everything is fine for 90 days, 180 days; and, then, all of a sudden, the results start to decline. Now, someone else is running your school, but you own it, your name is on the lease, and you’ve probably personally guaranteed the lease and other business obligations, which means your house, car and other assets you’ve accumulated are vulnerable to being attached if the school goes under.

The instructor, running your school, is an employee; and employees think quite differently about the business in which they work than the owner. Too often, when an employee opens the school on a Monday morning, his or her mindset is to do a minimum amount of work to keep a job and paycheck.

Conversely, when an owner opens his or her school on a Monday morning, the mindset is what can I do this week to make this business outrageously successful? What can I do to push myself to the next level? What can I do to push the school to the next level? What can I do to push the business to the next level?

For those school owners that want to grow into multiple locations and have greater financial security, such as you, Joe, the solution is a licensed structure or franchise system. Now, those instructors who assume the operations of your newly opened schools are not employees, but own those schools through a structured system and that changes their mindsets of what it takes to make those schools successful from an employee to an owner.

This is how many service industries have been developing; and we’re convinced that the martial arts industry is moving in that direction. Your individual school operators need assistance, but you, as the owner, don’t want to be 100% attached financially to the future of each individual unit. It multiplies your exposure by however many locations you have, which is not an enviable place to be.

Joe, what’s your next step that may be valuable for our readers? What are doing at your school that will help you reach your ultimate goals?

Joe: Since we just implemented a Master Club and Leadership program, I want to make sure they are in full operations. I want to fine-tune all the systems in my school and then move toward implementing even more strategies and ideas. We’re just trying to do our best and produce the maximum results.

Toby: What would you tell our readers who have an idea that they’ve been waiting to implement until the time is right or if they’re just not sure?

Joe: Throw it against the wall and see if it sticks. Go for it. The results may not be perfect, but you must follow that old saying, “shooting stars may land on the moon.” It’s a good way to think about new ideas. If you try to implement them perfectly, you may never do it. Ideas will sit on the shelf and collect dust. What good is that? Read and study your NAPMA material, and put the stuff into action. You may quickly discover that it’ll work better than you anticipated, which has been happening to me lately.