Contracts can be a problem. Contracts benefit the school owner by guaranteeing a steady income for the length of the contact, no matter whether you come to class or not; this helps them to acquire business loans. There is nothing detrimental about the use of contracts for the school owner, if there was, they would not use them.
Supposedly, contracts help the student because they motivate them to come to class to get their money’s worth of training, and they lock in training costs for the length of the contract. However, any benefits contracts offer students are far overshadowed by the liabilities of contracts. Students must pay for the length of the contact as long as the contracted services are offered, even if the services are not used. Over the length of the contract, fees will not increase much normally so locking the cost of fees is not really any benefit. When you change schools or styles, many times you are required to start again at the white belt level. Most students commit much time and effort to training in their chosen art, they develop friendships with other students, and, for those who like their instructors; they develop a loyalty to the instructors. This means that by the time the first contract ends, students are reluctant to change schools or styles, so they tend to sign another contract. Therefore, contracts are always good for school owners and never good for students.