Adding retreats to your offerings can be a great way to diversify and increase revenue. Here's how to evaluate if your business is ready for it.

Is your business ready for retreats?

As you build your business, there may come a time when you start to consider retreats. Adding retreats to your offerings can be a great way to diversify and increase revenue.

Aaaaand, let’s be honest,  they’re also a great way to combine business and pleasure travel! But, it’s not all fun and selfies. Hosting retreats also carries a bit of risk, so it’s important to determine if you’re really ready before diving in.

Here’s what to evaluate…

Do you have the people?

Before launching a retreat, it’s important to ask yourself if you have the audience to support it. Retreats are generally a high ticket investment that not everyone can afford. So consider if your audience can and will pay for one.

You need to be able to price the retreats high enough to cover not only the costs but also to make a profit. Otherwise, they won’t be an actual revenue stream. Be sure you understand all the costs involved in running a retreat before setting the price.

Retreats are similar to other high ticket offers in that you’ll likely have far more people interested in them than will actually pull the trigger. Take some steps to gauge interest but also remember that things may change when it’s time to pull out the credit card.

One client of mine who runs several retreats per year starts with an interest list for her events. This list gets early access to the application once we’re ready to start filling spots. We generally  get hundreds if not thousands of people who sign up for the interest list. When it comes time for the application, we usually see about 10-20% of the list fill one out. The application always includes a rough cost to help people self select.

Then, after reviewing the submitted applications, we send out invites to accepted people. From this much smaller pool of people, even smaller percentage of people actually buy a spot. Typically, we somewhere between 30-50% of accepted applicants actually end up joining us.

So, starting with several hundreds or thousands of interested people, very quickly whittles down to only a handful of buyers. But, you’ll generally only have a limited number of spots anyways! But these are important numbers to know up front.

Do you have a message that works?

Retreats are often centered around intense, intimate experiences and not everyone’s business lends themselves to such activities. So consider whether the work you do makes sense for a retreat setting.

It may also be beneficial to look at the goal or outcome of the retreats you would offer. Are you selling the experience? A tangible deliverable or outcome? Or perhaps a combination?

There is no perfect answer here but getting clear on how your work, message, or process fits into a retreat will help evaluate whether your business is ready for retreats.

Another of my clients centers her retreats around writing as well as the experience. Attendees sign up to get coaching and support around their writing goals as well as the chance to relax and recharge. This creates the need for a very different event than if attendees were looking to lose weight or build a new product for their business.

Got the capital to Invest?

While retreats can have high profit margins when you properly estimate costs and price appropriately, they also have high expenses. This is especially true when you make them all inclusive. Many of those expenses come at the front end before you can collect all the payments from attendees. So, you need to consider if your business can support the initial outlay.

There are ways to mitigate the initial costs such as locating a venue with a generous payment option, but there will certainly be expenses to cover.

Look at whether your business can float 5-figure expenses for weeks or months until you start collecting attendee payments. See if there’s a way to secure your location and vendors with very low deposits and generous cancellation policies so you have fewer costs to float!

And remember, if the demand is high and you’re comfortable with the risk, think about borrowing some capital for your first retreat. PayPal working capital is an easy, fast way to get some cash for instance. They have pretty reasonable rates and repayment terms if you regularly collect money via PayPal.

Now what?

If you determine you have a broad enough audience willing to invest, a message to share, and the capital to move forward, then you’re ready to get started. Start planning your next move towards launching your first retreat and enjoy the ride!

Adding retreats to your offerings can be a great way to diversify and increase revenue. Here's how to evaluate if your business is ready for it.