How bands can use economic theories to save on their rehearsal sessions.

by Jimmy Mulvihill

As a commercial rehearsal studio that has traded for 34+ years, with 1,450+ bands booking 47,000+ sessions in that time in one of the most expensive cities in the world, and with all of these sessions needing to generate enough income to pay our rent bills, wages and running costs, the economics of rehearsal sessions are second nature to us. We know what factors inflate the price of those sessions, which costs are necessary, and which aren't. Today we're going to teach you these lessons that we've learnt over those decades, so that you can save money on your sessions too.

Now I know what you're thinking: why would someone who owns a rehearsal studio voluntarily write a blog post about how bands can save money on their rehearsals? It sounds counter-intuitive to lay out a plan that could reduce my income, right? Not quite, as I'm actually going to instead look at the inefficiencies that cost rehearsal studios money, and then explain how you can help a rehearsal studio like us avoid them. In return, we will then offer a band like you a big discount on your sessions. If you can help us save £100, we'll be happy to split that saving with you and refund you £50 of it. We earn £50 more, you save £50.

This isn't just a casual suggestion about ideas that "could" save a bit of cash, I'm bringing receipts and hard data with me. This article has been put together using data compiled from Bally Studios, a business I've owned for 18 years and for which I have 23 years of complete data for, all organized in a spreadsheet with 165,000 data points. I've scanned old diaries from the years before I took over the business, and we've included every penny of expenditure and income in it, drawing lines between the actions we took and the results that followed. This article is not based on my gut feeling of what may work, but on the historical data that has been compiled over years that relates to tangiable results.

If you want to skip the theory and jump straight to the 'how to save money on your session' part without learning the economic theory behind it, no worries, click here. However, it's only about 20 minutes of reading, and understanding the logic behind the tips helps you to understand it better. Think of it as the difference between memorizing directions, and learning how to read a map. I’m confident enough to say that if you follow this advice it will save you at least £50 in the future, and it wouldn’t surprise me if it saved you multiples of that.

If you’re not a customer of ours, feel free to try these tips out wherever you rehearse, and if you run a rehearsal studio yourself and see ways that this post can save your business money, feel welcome to link to this post on your website. I’ve spoken to 100+ other studio owners in the last couple of years, and was able to provide the paperwork that allowed 8 other rehearsal studios to secure the grants that they needed to survive the March 2020 lockdown, and I'm more than happy for other studios to get what they can out of this too.

Times are hard in the music industry at the moment, and rehearsal studios need to look out for each other. Not only as an altruistic venture, but because I firmly believe that more rehearsal studios helps create a stronger grassroots music industry, which in turn helps my business. The only reason we're paying London rents is to be part of a vibrant city, and when rehearsal studios close down, it becomes less vibrant. In which case, what's the point of paying London rents?

Together we'll be exploring the costs that studios incur from the decisions that bands make, and how eliminating as many of these inefficiencies as possible can allow studios to reduce the price of the sessions. Once we understand the factors that inflate the cost of rehearsal sessions, bands can help studios avoid these costs and in return can ask for a discount on their session: one hand can wash the other.

It only occurred to me recently that this is a part of the business that I’ve never seen anyone write about, and the more I thought about it, the more it didn’t make sense. We’re all going through an almost unprecedented cost of living crisis at the moment. Bands want to save money, studios want to save money, bands want studios to survive and studio owners want their studios to survive too, so why not just put the facts down in a blog post with the intention of helping both parties?

The Economics of the Rehearsal Studio industry.

Even if you didn't study economics, certain economic principles are easy to understand. If you walked around a big supermarket with a friend, and they commented to you that the prices in the supermarket were cheaper than in the small corner shop just down the road, and if they then reasoned that the supermarket must be making less profits as a result, it’s would be very easy to see the flaw in that argument. You could also see the flawed “logic” that led to that incorrect assumption. Higher prices can often mean better profit margins, true, and there’s a link between a healthy profit margin and a healthy profits. Nevertheless, on an instinctual level it makes no sense to think a small corner shop with higher prices would ever be more profitable than a big out of town supermarket, and you don’t need to have studied economics to understand that. Most people will just instinctively understand that the big supermarket is more profitable, despite being cheaper.

If you then started to list the reasons as to why this was the case, many people would also nod along with you and agree with each point. The supermarket may be getting their stock from the supplier for much cheaper from buying it in much bigger bulk, and they can then pass those cheaper prices onto the customer. The supermarket also has long lines of people with full trolleys waiting to buy their goods, whilst the small corner shop has a little old lady wanting to buy a few tins of cat food for Mr Tibbs. Most people have not studied economics, but they don't need to. Most person can understand these factors in an instinctual basis.

Paradoxically, it is this “understanding” that causes so much inefficiencies in the music rehearsal studio industry. People think that the same assumptions that apply to most other businesses also apply to band practice rooms, but that is not the case. There are many factors that actually work in reserve, and this is what makes the music rehearsal industry so unpredictable.

What makes rehearsal studios different?

There are a huge amount of factors that go into the success of any company, and two of the most important factors are “scale” and “efficiency.” These are the factors that supermarkets can use to their advantage the most, but they are factors that have little to no value to rehearsal studios.

Scale – Even if you do have a slimmer profit margin, the more products you can sell at that price, the more profits you can make. A business operating on the “pile it high, sell it cheap” principle that sells 1 million items a week with a 10p profit margin, will make more profits than a business selling 1,000 items a week with a 50p profit margin. A supermarket with 1000 locations, that can serve 500 customers an hour at each of them, will have higher profits than a small business with only 1 cashier who can serve 50 customers an hour. This will affect the money that they can spend as well to promote their business. A supermarket with 1,000 locations can afford to pay for a big advertising campaign as the cost will be spread out between all of the stores. Make no mistake, understanding how to “scale” your business is a basic cornerstone to success in business.

Efficiency – This factor measures how well run a business is run, how little money is wasted, and how they can convert their sales into profits. You could be making £1 million of sales a day, but if you’re employing way too many people, and wasting a lot of money on other costs, then it will affect how much actual profits you make. Factors that contribute to this include the price that they were able to buy the products at, how cheap your running costs are, reducing how many items get stolen or damaged, how many products they can cram onto their shelves, the speed at which they can operate, and so on. The more efficient a business is run, the more profits they can make.

Scale, and efficiency. A success of a business will depend, among many other things, on a combination of these two factors, and in any other business these factors seem obvious and, as I mentioned before, instinctual. If you go into a high end boutique clothes shop which has a few items that have been carefully curated by the shop dotted around, with loads of space around them for you to admire them, you’ll expect it to be a much more expensive shop than a TK-Maxx style shop, which has rows and rows of clothes packed together and with claustrophobic isles that you have to squeeze past your fellow shoppers in. You’ll expect that the boutique store that assigns you a personal member of staff, who will hand you a lemon tea and help you pick out an outfit with you whilst explaining whether vertical or horizontal stripes look better on you, is going to be charging you much more than the store that employs a teenager who is tasked with hanging piles of clothes onto the clothes racks.

Key to this is the stock cycles that businesses can go through as well. A supermarket can put 100 items on their shelves, sell them, put another another 100 items on their shelves, sell them, and when they’ve run out of all of the items from their warehouse they can order more of them in, and so long as demand is high, they can keep on doing that indefinitely. Their biggest limitations are their inability to put the items on the shelves quickly enough, (for which they can hire more staff to do), their inability to get replacement stock quickly (for which they can get to the front of the queue of their supplier if they order in bigger bulk), and their inability to sell it quickly (for which they can hire more checkout staff.) In all cases, if they hit a limitation, the profits from the previous sales creates the money needed to overcome future limitations. In this way, success is cyclical. The success that they have from selling provides them with the money to re-invest in even more resources to sell even more products. Success feeds success.

The ability for supermarkets to scale up their operations is at times staggering. When I worked as a butcher when I was a teenager there were times that we’d get a whole pallet of turkeys come in at Christmas and we would just sell them straight off the pallet, without even putting them on the shelf. At those times scale, and efficiency were through the roof. We didn’t need to store them, they weren’t taking up space on the shelf, they didn’t need to be kept cold in the chiller, there was no risk that any of the birds wouldn't sell, and we didn’t even need to pay a staff member to stack the shelves. People were asked to pick up a turkey straight off the pallet, bring it to the counter and put it on the scale, and they’d be told the price, and it was put into a blue and white stripes bag and off the customer went.

At the same time I was also working at a supermarket 2 days a week in which there was a department that was marked as “seasonal” that would change on a constant basis. It had Easter eggs at Easter, Christmas decorations at Christmas, it was piled high with England flags and multi-packs of beer when a football tournament was on, and back to school supplies at the end of August. The shop changed what it offered based on the expected level of demand for that time of year. The ability so change what they sell based on the demand of a product allows them to capitalize on the demand of different products at different times of years, and thus increase the scale of those sales, and stop selling items that don't sell well at that time of the year, in doing so maximizing efficiency. These factors are a key part of the success of supermarkets today, yet these factors don't apply to rehearsal studios. None of them.

Supermarkets v Rehearsal Studios.

Supermarkets can be agile and flexible in their approach. If the demand is too much? They get more staff in. If they sell their stock, they get more delivered. If the Easter eggs are selling well, they open up their own aisle for them. When sales plummet of a certain product, they stop selling it. You name it, they can change their approach accordingly and this approach allows them to increase scale, and increase efficiency. No wonder supermarkets make so much money.

None of these factors apply to rehearsal studios, for which the biggest limitations are “time” and “studios”.

Time: If a band comes to us for a session for a specific time, and we don’t have a studio available for them for it, that sale is lost. If they say they want a studio on a Tuesday for 7pm – 11pm, we might say that we have a studio for the 5pm – 8pm slot, but not the 7pm – 11pm slot that they request. If they can’t do the 5pm – 8pm slot, there’s nothing we can do. They may like the studios, the service we provide, the equipment, the location, the price, everything else, but if they cannot do the time slots that we have available, then the booking is lost.

We can’t bend time to match their schedule, we can’t move the other sessions that other bands have already booked in, and we can’t fit a 4 hour session into 3 hours. Time is a huge factor for rehearsal studios, and there’s no way around it. By contrast if a shopper wants to buy a product as 5pm? Sure. At 3pm? No worries. At 8pm? Of course. They have a huge window to buy their products in, and you can have 500+ customers in the supermarket at the same time., whereas we have a limit of 1 band per studio. The limitation of "time" on a rehearsal studios is one that supermarkets don't have to contend with.

Studios: It can cost £35,000 - £40,000 to soundproof and acoustically treat a studio, and then £5,000 or so to buy the necessary equipment for it, and there’s no way that that amount of money can be invested without a long term lease being signed on the unit to enable the studio to earn that money back. Doing so means a commitment of years and tens of thousands of pounds of investment, which means that we’ll still need to rent the spaces whether we have bookings or not. If we suddenly get a rush of 10 bookings for one night, there’s no way that we can react quick enough to accommodate the extra demand, due to the huge hurdles that we'd need to overcome to build new studios. Therefore, even if we had 10+ booking requests in one night, the limitations of us having 5 rehearsal studios means that we can’t satisfy these bookings. If we built more studios to accommodate the increased demand for bookings that we get in our busy periods, we’ll still need to pay rent on them in our low periods. Our ability to react to the market forces of supply and demand are limited in a way that few people outside the rehearsal studios industry can relate to.

We once had 19 bands ask for a studio on a Thursday night in 2008, of which we had to turn away 15 of them as we only had 4 studios at the time. Each of those bands were happy to pay £40+, so that was £600+ of bookings in one evening that we couldn't satisfy. In fact, this was the tipping point to us converting our old Studio 1 into the new Smaller Studio 1 and the brand new Studio 5, as we felt it was crazy to have turned away an average of 1.3 bookings per day from Jan 2008 – April 2008, whilst at the same time having our most popular studios being the smaller one that we had at the time. If we have one huge studio that can be divided into 2 smaller studios, and if the bands that come to us wanted us to provide them with more smaller studios, it made complete sense to split the studio up, and so that’s what we did.

However, we spent £20,000+ on the conversion, (which was cheaper from us doing 781 hours of work ourselves in 75 days), and we had to turn away a huge amount of bookings at the time from the studios being unusable whilst they were being constructed. We also had the risk that the bands that could no longer get their regular rehearsal studios may have got used to rehearsing elsewhere in those near 11 weeks of construction that it took for us to complete the work, a time in when the amount of studios we had available went from 4, down to 3 during the construction, before then jumping to 5 once the two new smaller studios had been built. It took 11 weeks and £20,000+ to change the supply of our product to meet demand, whereas supermarkets can respond to the changes in supply and demand by moving some goods from one shelf to another, a job that can be done in a few hours by one member of staff. I once worked for a major supermarket as a teenager, mainly in Colindale but on certain days I'd be moved across to the Wembley store, very near to the stadium, when exceptional demand was expected. It was my job to work on the rotisserie counter, and with 80,000 fans descending on the area, it was my job to keep those chickens cooking on the spinning metal spikes. When demand soared, the supermarket would increase the supply of products, and the staff available to sell them. It was all arranged with a single 1 minute meeting with my manager. When trade was good they increased the factors that sell more products. When trade was low, they decreased those factors. Our ability to change the amount of studios we have is practically impossible. We have inherent limits that we cannot overcome as easily. Rehearsal studios can’t benefit from a temporary period of peak demand in the same way that many businesses can. Many pubs based next to football grounds barely break even on most days, but the huge boost of hundreds of football fans visiting them before or after the game more than compensates for their lack of trade in other times. I’ve spoken to a band member whose family ran a pub in Glastonbury who said that the money that they made in the 3 days of the Glastonbury Festival, as well as a couple of days either side of it, was enough to keep them afloat for the other 51 weeks of the year. The same applies to numerous other business like a flower stall on Valentines Day, or a bookies on Grand National day, all of which are able to hire extra staff to handle excess demand for a single day. If we have 5 studios, we can only accommodate 5 bands at any one time as we can’t ask bands to share studios. Our ability to scale up our business is extremely restricted compared to other businesses.

Big supermarkets can also increase their efficiency to both reduce their prices, which in turn will hopefully expand their customer base, and help to increase their profit margins too in numerous ways. By launching their home-brand products they can supply their own products to customers, and in doing so cut out the middle man and the manufacturers profit margin. Self checkouts can reduce staff costs, and moving the supermarket from a central location on the high street to a cheaper location on the edge of town can reduce rents. These companies have huge backing behind them that allows them the ability to move location should they need to, and the knock on effects of a supermarket being based in a certain locations gives them big bargaining power when seeking help from the local council. There are numerous stories of a whole town being reliant on a single supermarket and when they leave, the local population leaves along with it, such as in this case, or this case. The closure of a supermarket can have a huge effect on a town, with shoppers needing to spend a lot of extra time and money to travel to the next town for their weekly shop, and the loss of local jobs can have a big effect too. A supermarket can use this power to demand tax breaks or preferential treatment from the local council. Their larger profits also create a buffer that they can use to get through the hard periods when changes are necessary.

Rehearsal studios don’t have the same power. Most of them will have one member of staff working at one time, so cutting staff isn’t an option. We can’t bargain hard with the local council, we can’t negotiate a better deal with a supplier as we don’t have one, and it will be hard for us to negotiate a better rent with your landlord if you’re withing a young and vibrant area, as many rehearsal studios are. The scope for making a saving in the rehearsal studios industry really is pretty limited, especially in a post-COVID world where employers are able to cut rent and employee costs by offering staff the option to work at home, or where companies are able to use automation, artificial intelligence or advancements in technology to reduce their running costs and increase their efficiency. Rehearsal studios can't do the same. There’s no robot invented that can clean a rehearsal studio, change over a blown speaker and re-skin a drum kit, and even if there was, the savings made on staff costs would likely have big knock on effects elsewhere (as I’ll discuss in more detail in a later blog post.)

“Opportunity Costs” - the biggest factor that affects rehearsal studios income. By far.

Each business has costs, like rent, wages and utility bills, but an "Opportunity Cost" is different - it's the lost potential to make more income from a missed opportunity, as opposed to losing actual money. For example, if you have £1,000 in the bank and someone offers you the chance to earn another £1,000 in a night, and if you have to turn that opportunity down, your opportunity cost is £1,000, as that is what you could have potentially earned, but didn't. This doesn't mean you have £1,000 less than you used to, your bank account remains unchanged and you still have your original £1,000 so you haven't LOST anything, but if circumstances were different you could have had another £1,000. That's your Opportunity cost - it's the value of what you could have earned, but didn't. Opportunity costs hit rehearsal studios a lot more than they do other businesses. Here’s an example to lay those factors bare. Let's say that the shop has a target to sell 100 tins of beans in a week, which can be done in the following ways:

Scenario 1a: they sell 20 tins on a Monday, 20 tins on a Tuesday, 20 tins on a Wednesday, 20 tins on a Thursday, and 20 tins on a Friday. By the end of trading on Friday they've sold 100 tins.

Scenario 1b: they don't sell any tins from Monday to Thursday, but they sell all 100 on them on Friday. By the end of trading on Friday they've sold 100 tins.

Scenario 2a: 100 people come into the shop to buy a tin of beans. They each pick up a tin, go to the till, pay their money and walk out with their purchase made. All 100 tins are sold.

Scenario 2b: 100 people walk into the store, put the tins of beans in their basket, go to the till, but 50 of them then reconsider their purchase and put the item back on the shelf. Only 50 of the 100 customers went through with their purchase, and 50 didn't. However, another 50 people later walk in, pick up those 50 tins that were discarded by the original shoppers and purchase them. Eventually, all 100 tins are sold.

In all of these scenarios the shop made the EXACT same amount of sales, and the EXACT same amount of profits. In all cases 100 tins of beans were sold, and the price of tins of beans doesn't change based on whether it's sold on a Monday or Tuesday, The staff costs were unaffected since staff members were employed from Monday to Friday in all scenarios, whether they were waiting for customers to come in or they were busy serving customers. The rent of the shop didn't change, and the cost that the shop bought the tins from the wholesaler didn't change. The fact that these tins of beans were sold at different times made no difference to the overall sales, and neither did the fact that in one scenario 50 people backed out of making the purchase, since the shoppers that came in after them made those sales anyway, (assuming there was only 100 tins available). The variations in the scenarios did not affect the shops income at all.

These rules don't apply to rehearsal studios.

Why the economics of rehearsal studios are different, and how bands can save money by understanding why this is.

Reason 1: Not only do sessions need to be booked, they need to be booked in an evenly distributed way.

Below is a typical scenario of the level of demand that a rehearsal studio such as Bally may have on any given week, from Monday to Friday. For the sake of simplicity let's say that each band is charged the same £40 for their session. We have 25 slots available (5 per day, over 5 days) and 25 bands looking to do sessions. In this scenario below we can accommodate 20 of the 25 bands that wish to book a session, with the other 5 bands going on the cancellation list, which is a list of bands who wanted a session that day, who we couldn't book in as we had no available studios. If any of the bands that are booked in later cancel their session, we contact the bands on the waiting list to let them know we now have a studio available for them, so it works as a back up option for both the studios, and the bands.

However - and here's the detail that's crucial - we don't make any extra money from bands who are on the cancellation list since they're not booking a session with us. If one of the original bands that are booked in needs to cancel their session later, we contact the band on the cancellation list and offer them the opportunity to take over the session over from the band that's cancelling. Again, Bally Studios don't make extra any money from this since Band A decided to cancel, and Band B took their place, paying the session fee instead of Band A. We don't increase how many bands pay for a session, we just change who we receive the money from. In this scenario - x 20 bands booked a session. - x5 bands are on the cancellation list. 20 bands each paying £40 means £800 of income for the studios. We don't make any money from the bands on the cancellation list. The above scenario gives Bally £800 of income, before costs.

How bands can use this to get a better deal.

Now let's imagine that Band 7, Band 8, Band 14 and Band 15 are all flexible in their schedule and decide to use this flexibility to demand a better deal from us. They make a proposal to us: they'll move their slots from the busier days to another day which has less demand for it, and in return they want a half price session, with the price being reduced from £40 to £20. Let's see what happens if we accept that deal.

The green slots are the slots that have been vacated by bands moving the day of their booking, and the bands with their bookings in red are the ones that have moved their slots from Tuesday/Wednesday to the other less busy days in the week.

Band 7 moves from their Tuesday slot to Thursday. Band 8 moves from Tuesday to Monday.

Band 14 moves from Wednesday to Thursday.

Band 15 moves from Wednesday to Friday.

In doing so, all of these bands now open up new slots that can be filled with bands that were once on the cancellation list. Bands 9 & 10 move from the cancellation list to take the new vacated slots on Tuesday, and Bands 16 & 17 move from the cancellation list to take the newly vacated slots on Wednesday. Bally Studios were making no money from these bands before as they were on the cancellation list, but now we can take their booking, so we are. The bands that were previously on the cancellation list are now in blue on the booking schedule, with the bands who moved their sessions from the Tuesday and Wednesday to other days still in red.

Bally still has 25 slots available, and we still have 25 bands looking for sessions, but now 24 of them are filled, with 20 bands paying the full fee, but the 4 bands that were happy to move their session now paying a half price fee as reward from them moving their slots from the busier days to the less busy days, which allowed us to gain more bookings.

In this scenario - x 24 bands booked a session. - x1 band is on the cancellation list.

Of the 24 bands who are now booked in: - x20 bands are paying full fee of £40 = £800 (bands in black and blue on the above table) - We have x4 bands paying a half price fee of £20 from being flexible in their booking, (the bands in red on the above table) so that's an additional income of £80. Total income for the studios = £880.

In this scenario: - x4 bands get a half price sessions from vacating slots, saving them money - x4 more bands get to rehearse from those slots being freed up. - The studios makes an extra £80, with it's income going from £800 to £880. Win-win-win.

However, this doesn't mean that we make 10% extra profits, since the vast majority of our costs are fixed. If we have fixed costs of, say, £500 for the week, then increasing our income from £800 to £880 actually means profits increasing from £300 to £380, which is an increase of profits of over 25%, all from a 10% rise in income. We'd be paying the same amount of wages to a staff member if they have 2 or 5 bands to look after, and our landlord isn't going to offer us a discount on our rent if we have fewer bands in, so our rent remains the same. Costs such as rent, business rates, bank charges, telephone bills, insurance and advertising remain mostly unaffected from these extra bookings, which means that they provide a much great profit margin on these extra bookings. Make no mistake, these extra bookings are a huge help to rehearsal studios, and that is precisely the reason why so many studios are so happy to negotiate with bands who have flexible schedules.

Lesson 1: If you are a band that has a flexible schedule, you can use this fact to get MUCH cheaper sessions.

Reason 2: There can be an opportunity cost to the studio that needs to be factored into each booking. Imagine a scenario where 4 bands are booked in over 5 studios on a weekday evening, which leaves us 1 studio left that is now available. Band 5 calls us to make a booking, and we book them into the 5th studios, and now we cannot take any more bookings. Band 6 calls us 5 minutes later and wants to book a session on the same night, but all of our studios are booked so we can't accept their booking request. If Band 5 then cancelled their session a couple of hours before it was due to start, not only does the studios lose the booking from Band 5, we also lost the booking that Band 6 would have made if Band 5 hadn't reserved the slot instead. We lose other potential bookings when a band books a session with us and later cancels it, which is why we need to charge a cancellation fee, and this is also a cost that we need to factor in when deciding how much to charge bands who come to us. A rehearsal studio not only has the usual costs such as rent, wages, electricity bills, business rates, etc, it also has to factor in an extra profit margin to compensate for the bands who book sessions, and later cancel them and then "go off the grid" and never contact us again, or even block our number to avoid paying the cancellation fee. And yes, it happens, more than you'd think. And yes, other studios can find out about these bands too. In the above example for the supermarket selling the tins of beans, the shop didn't lose out on any additional sales from people deciding at the last minute to cancel their sessions. Person A picked up the can of beans, was about to make the purchase, but then they changed their mind and put it back on the shelf. Person B then came into the shop, picked up that same can of bean, put it into their basket and made the purchase. Whilst the shop lost out on a sale to Person A, Person A's decision to not buy the item didn't cause the shop to miss out on the sale to Person B, so the sale was eventually made anyway. In addition, for rehearsal studios it is not only the factor of whether we get a booking or not, but also the value of the booking that is important. If Band 5 wanted to book for a 3 hour session, by taking that booking we'd now be unable to take a booking by another band who could, hypothetically, want to make a 4 or 5 hour booking, and this is something else that we need to factor into our prices. In the supermarket, if there's 100 tins of beans of the shelf, if someone buys a small amount of tins, it doesn't stop someone else from purchasing theirs. Even if there were only 3 tins left and the next person wanted to buy 5, in most likelihood they're going to take the 3 that are left and decide to pick up another 2 tins the next time that the are in the shop. If they choose to buy none, then the next person can buy the 3 tins instead. One person's choice over deciding to buy a product, and then changing their mind, doesn't affect the shops ability to sell more of them to other people. By contrast, if a band books a 3 hour session with us, we're not able to book in another band in the 1 remaining hour that goes unused. We therefore have to factor in the price of turning away a 4 hour booking, when we decide how much to charge the band that wants the 3 hour booking. This is the reason why the longer your session is, the cheaper the per hour rate will be. The later a band books in, the less chance there is that the rehearsal studio would have been able to fill that slot with a booking of a greater value. Thus the less they'll need to factor this into whether to accept your shorter booking or not. If November is a busy month, and if Tuesday is our busiest day, there's no point in us accepting a lower value booking in November on a Tuesday when the booking is requested 3 months in advance, as we'll likely be able to fill that slot in the meantime with a more profitable 4-hour booking instead. The closer to the date the booking is made, the less chance there is that the slot will be filled, and the more chance that the studios will be willing to do a last minute discounted deal. Last minute sessions have a much better chance of being discounted. If you can also book sessions last minute, you may be able to take sessions off of the hands of other bands on the basis that you'll contribute to part of their cancellation fee. If another band cancels on the day and has to pay a £40 cancellation fee, you can offer to take that session off of their hands at the last minute, on the basis that you pay £20 for it, and thus reduce their cancellation fee by £20. You'll reduce their cancellation fee, and they couldn't make the session anyway. Lesson 2: Each session a band books prevents the rehearsal studios from earning extra money from other bands. Work with the studios to minimize these factors, in return for a cheaper rate, by: - Booking last minute when there's less chance of a booking being made. - Never cancelling a session. - Booking longer sessions for a cheaper per hour rate. If you're in a band that never cancels sessions, you're the best kind of customer for a studio and you can use this to bargain with them.

Reason 3:

A rehearsal studios will have associated variable costs that change based on the band's booking habits. By understanding these costs, you can use this information to help reduce their costs, in return for you getting a cheaper session.

In the above example the supermarket stays open all week, so their staff costs remain the same whether they make their sales on one day, or another day. Whether they have 10 or 200 customers in the store at any one time, they need to stay opened. If there is a point at 3:15pm on a Thursday where there are only 10 customers in the store, then they're not going to shoo them out the door and close the shop down and go home. They're open all day, and their fridges, lights and escalators stay on the whole time, ready for when that next customer arrives. The nature of walk in trade means they need to stay open, no matter how busy they are, and so costs such as wages and electricity remain relatively constant. Supermarkets have advertising budgets, shareholder payments, research and development costs, all of which are also relatively constant. While there are some costs that vary, you'd be surprised by how constant the costs of a supermarket are.

By comparison, rehearsal studios operate mainly on a pre-booking system where bands usually contact us in advance to have a session. The odd band does turn up unannounced, it happens, but mostly we have bands that book their session with us, and so we plan staff shifts around that. As a result, our costs vary based on the booking habits of the bands that use us. Our costs vary depending on how bands book their sessions. When we hire staff we'll do so on the basis of them working a set amount of hours each week. but those hours will be flexible. A staff member may be told they'll get 20 hours a week, but that may work out as 17 hours in Week 1, and 23 hours in Week 2, with some hours moving from one week to another. When we have no bookings we switch all of the lighting off and the only thing consuming electricity is the fridge and CCTV, whereas when we're in full flow we have a 4KW PA system running on full in each studio. When a band books a session we pay a staff member to get the room ready for them, which can take 10 minutes, and then we pay a staff member to pack everything down and clean the room at the end, which can take 15-20 minutes. Although we have constant costs such as rent, business rates, etc, we also have substantial 'transaction costs', which only come about as a direct result of us having more bookings. Whereas a supermarket has high baseline costs and low variable costs, a rehearsal studios will have medium baseline costs and high variable costs. Above I showed how the distribution of bookings affect a studio's income, but here we see how it affects their costs too. Here is scenario 1, where we have 7 bands booked in the 5 studios on a Sunday. The first band comes in at 10am, the last band leaves at 11pm, and there's a 2 hour window between 6pm and 8pm when we have no bands booked in at all. This presents the studios with a problem. 2 hours isn't enough time for a staff member to go home and have a bit of time off between sessions, so they need to be paid for those hours. Whilst they can still be doing jobs around the studios, these jobs could have also been done at a time when the studios was also earning an income. We have 20 hours of bookings during the day, and 13 hours of staff costs, 2 hours of these costs coming at a time when we have no income at all.

Now let's say that two of the bands that were booked in that day were able to adjust their bookings slightly, with 'Band 2' moving their session to a slot 2 hours earlier, (from 8pm - 11pm to 6pm - 9pm), and with Band 3 moving their slot a bit later, (from 10am - 12pm to 12pm -2pm.) After those changes, we now have this new booking schedule.

We still have 20 hours of bookings during the day, but now the first band is in at 12pm, and the last band is in at 9pm. We only have 9 hours of staff costs, and at all times there's a band that is present in the studio, with no "dead slots," or no time periods where the studios is not making any money.

In this scenario these two bands were able to save the studios 4 hours of staff costs from moving their session times slightly. They still got the whole session that they booked, but at a slightly different time. If you have a flexible schedule, you should be confident and open with your rehearsal studios and propose to them that you're willing to change the time/date of your sessions, in return for a discounted session price. By allowing the studio to save on costs, you can save on your session fees. Lesson 3: Rehearsal studios can earn more money and save on their costs when bands have more flexible schedules. If you're in a band that has a tight budget who has flexibility in your schedule, let your rehearsal studios know this, and use it to get a better deal.

Now that we have the theory out of the way, click below to see how that translates into real world savings in the next blog.

15 Practical ways to save money on your rehearsals sessions.