10 Things to Consider When Opening a Yoga Studio

A Concise Guide to Protecting Your Studio and Practices - Caroline Conway

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This article is a quick list of legal issues to think about when starting your business, whether it’s as an independent contractor or opening a yoga studio, but it’s not a substitute for legal advice. I’ve noticed a lot of resources focus on financial planning without addressing the need for legal advice, and I hope this helps you with your planning!

1. Business! Your Plan, Structure, and Registration

In addition to startup funding, you’ll need a business plan, and a registered business. A business plan isn’t necessarily a legal concern, but getting organized with a business plan can help you determine what type of business structure you need. Your plan should include financial plans and projections along with your budget, strategies to reach clients, and your services and products.

Your business structure might be a sole proprietorship, partnership, limited liability company, or corporation. There are pros and cons to each type, and the U.S. Small Business Association has a chart comparing them. Once you know your structure, you can register your business in accordance with whatever the requirements are where you live.

2. Taxes

In the U.S., your business will need a federal employee identification number (FEIN) and a state tax identification number. An accountant can advise you about the tax requirements for your type of business structure, including federal, state, local, sales, unemployment, self-employment, and property taxes.

3. Employees and Independent Contractors

Employee misclassification is a serious and common problem that typically occurs when a business classifies a worker as an independent contractor when they should be an employee. The difference between the two involves protections and benefits as well as taxes. The U.S. Department of Labor has a webpage with information about employee misclassification, including myths, a Fact Sheet about employment relationships under the Fair Labor Standards Act, and rulemaking.

4. Discrimination, Diversity, and Inclusion

Chances are you’ve undergone some type of discrimination training at this point in your life, so you know the basics. Discrimination is differential treatment of people, typically those in protected classes more vulnerable to such treatment, and it encompasses a multitude of behaviors. As a business owner, you need to be aware of your obligations to prevent discrimination and investigate complaints when they arise, whether they come from employees, clients, or contractors.

5. Contracts

All kinds of contracts are necessary for a business to run. Leases are contracts, and you may have contracts for employment and contracts for services with independent contractors. You may also have contracts for equipment and supplies. Contracts are important because they establish clear expectations of both parties.

6. Liability Waivers

An important piece of any business that provides services is a liability waiver. They are not automatically enforceable, but the odds increase when they are drafted well. A proper waiver is specific about the risks a client will take on and specific about what you are asking the client to waive. Keep in mind that although liability for something like a foreseeable injury may be waived, a court is unlikely to hold that a waiver is enforceable if you ask someone to waive liability for other issues like sexual harassment or discrimination.

7. Insurance

There are different types of insurance that may be relevant for your business. You may need general liability insurance, professional liability insurance, yoga insurance, and property insurance. If you have employees, you will also need to consider the requirements for unemployment insurance and workers compensation insurance. If you host events in public parks or run retreats, you may have additional insurance requirements to consider.

8. Leases

Depending on what your options are, you may consider renting space from a landlord for your business or entering into agreements for shared space with other businesses. Renting your own space gives you a certain degree of control over your environment, an opportunity to create your own community in your own space, and independence. It also comes with additional responsibilities to manage a physical facility with financial risks of fixed expenses and uncertain revenue and legal liability.

9. Intellectual Property

Your name and logo can be trademarked so others cannot use it on a national level. Intellectual property may also be created through written materials, video or audio recordings, and photography. Issues can also arise regarding work that may already be protected, like music played in yoga classes.

10. Merchandise

If your yoga studio sells merchandise there are a few things to consider, such as sales tax, products liability, and intellectual property infringement. The risk of issues with those will vary depending on the products you sell. A business that sells handmade mala beads is not as likely to have an intellectual property issue as one that sells t-shirts with a logo that is like that of another business.

I hope this short list will help you protect your yoga studio and everyone who practices there. The list is a starting point for what to consider, but not a replacement for customized legal advice. I hope your studio will be a welcome addition to the community in your area and be a resounding success!