What to consider when opening a studio
Congratulations – you’re embarking on the exciting journey of studio ownership! Just like a well-sequenced Pilates class, a successful studio needs a strong foundation. Aside from polished floorboards, perfect playlists and slick Pilates equipment, there are a few legal boxes to tick to give your studio the best chance of long-term success.
Corporate Structure
Choosing the right business structure is like setting up your client correctly on the reformer – get it wrong at the start and you may be dealing with discomfort later. You want a structure that can grow with you and is fit for purpose as you add more classes, instructors and possibly locations.
A sole trader structure, for example, can be very risky for a studio business. With clients moving, twisting and loading their bodies, there’s always a risk of injury. As a sole trader, you can be personally liable if something goes wrong – which means your personal assets (like your home) may be on the line. Not a smart move when you’re working this hard to build something.
There are also tax implications and potential benefits to different structures (such as companies or trusts), particularly as your revenue grows or if you’re going into business with a partner. The “cheapest and quickest” option at the start may cost you more down the track in tax, liability and restructuring fees.
Before you set up your structure, make sure you get both legal and accounting advice. Think of it as your pre-opening assessment: getting clarity now can save you a lot of pain later.
Lease
It’s easy to get overexcited and sign a lease the minute you find the perfect light-filled space. But take a breath before you grab the keys. A commercial lease is often one of the biggest financial commitments your studio will make, and many standard leases are heavily weighted in favour of the landlord.
Some key items to consider include:
Does the retail leasing legislation in your State apply? If so, you may have extra protections as a tenant.
Do you have an option to renew? This can be crucial once you’ve built a loyal client base in that location.
How will rent be reviewed each year? Is it a fixed percentage, CPI, or market review – and is it consistent with current market rates?
What is the bank guarantee/security deposit, and is it reasonable? Large guarantees can tie up your cash.
Outgoings: Does the landlord need to consult with you before incurring any significant outgoings that you’ll be contributing to?
Assignment: If you want to sell your studio in the future, what does the process look like? Is it a straightforward transfer to a buyer, or will the landlord make you jump through Pilates rings?
Having your lease properly reviewed before you sign can help you negotiate fairer terms and avoid nasty surprises mid-term.
Equipment
Your equipment is the heart of your studio experience. Whoever you source it from, make sure you have clear warranties and guarantees from the supplier. If a reformer rail cracks or a spring fails, you want to know who is responsible for repair or replacement – and how quickly it will happen.
If you expect any maintenance or servicing from the supplier or manufacturer, get this in writing. This might include regular safety checks, replacement parts or response times for repairs. Don’t rely on handshake deals or casual emails – if it’s important to your studio running smoothly, it should be in a written agreement.
In short?
Taking the time to set things up properly – structure, lease and equipment – won’t be as exciting as choosing your logo or playlist, but it’s the behind-the-scenes work that gives your studio strength, stability and room to grow.
Marianne Marchesi is the Director of Legalite an award-winning Australian law firm that makes legal simple — helping Pilates studios and wellness businesses grow with confidence through clear, practical, and people-first advice. Find out more ttps://legalite.com.au