What is the cost of opening a tuition centre?

The global private tutoring market is forecast to grow by up to 9% by 2030. Dynamic and innovative, the personalised education industry presents a number of unique opportunities for entrepreneurs, combining a high ROI with a measurable social impact.

Opening a tuition centre is one such ambitious and exciting venture, offering a scaleable business with reliable financial rewards, together with the fulfilment of providing learning resources for your local community.

That said, startups can come with a number of challenges, such as unpredictable cashflows, issues with securing funding, limited growth capital and high overhead costs.

Education franchise opportunities can help to mitigate many of the financial stresses of launching a new business. Having support in place for market research and content creation gives franchisees greater freedom to be their own boss, allowing them to focus their energy on operational growth and development.

Contents

Key takeaways
Typical startup costs: How much does it cost to open a tuition centre?
How do tuition centres compare with online tutoring services?
Becoming a GoStudent partner
Target market: financial considerations
Annual revenue: potential earnings for different businesses
Legislation needs: legal requirements and costs
GoStudent partnerships: an investment in learning

Key takeaways

• Private tuition is a fast growing industry both in the UK and at the global level

• Education franchises can provide opportunities for lower start up costs

• Startup costs can vary widely depending on location

• In-person delivery formats dominate European tuition market demand

• No formal qualifications are needed to open a tuition centre

• GoStudent offers free consultations, bespoke business plans and comprehensive training support for entrepreneurs looking to enter the private tuition market

In this article, we'll explore the financial aspects of opening a tuition centre (including marketing costs and average revenues), how a franchise can be the difference between venture failure and ongoing success, and the benefits that GoStudent can bring educational entrepreneurs.

Typical startup costs: How much does it cost to open a tuition centre?

The tutoring industry is competitive. Start up costs within the UK education sector vary widely, ranging from £20,000 to over £100,000 with factors such as location, study level, subject focus and business model impacting total expenditure. Some of the principal areas of financial investment during the launch process include:

• Business plan support: external consultation fees may be incurred if planning advice is needed

• Overhead costs: venue rental, insurance, utilities and admin expenses

• Marketing strategy and advertising costs: launch campaign materials, including physical assets such as posters and flyers, constitute a significant proportion of launch costs

• Web hosting services: establishing a digital presence is an essential step for new businesses

• Teaching materials: while free resources are available, top quality educational materials are a non-negotiable cost to ensure tutor efficacy and student satisfaction

Unfortunately, many franchisees fall at the first hurdle due to poor budget allocation, unrealistic cash flow expectations, and failure to plan for hidden expenses. GoStudent provides bespoke financial plans and advice that cover all the costs from launch through the first years of operation. Professional consultation is also available for franchisees who require a loan, or other forms of external financing.

How do tuition centres compare with online tutoring services?

While venue expenses are greatly reduced for digital businesses, online tutoring services can incur higher advertising costs as they seek to compete with large online tutoring marketplaces.

Creating a client base within a fixed location can provide interesting opportunities that may not be available to online tutoring businesses:

• In-person tutoring sessions have the potential to attract students who are looking for highly personalised support

• Tuition centres are more likely to follow a set curriculum of lesson plans, which can allow for more rigorous quality control than online tutoring businesses

• Hyper-localised marketing strategies permit franchisees to capture targets that would otherwise remain untapped

• Word of mouth referrals help to build trust and credibility while reducing marketing expenditure

• Local centers can provide academic support close to a student's home, which can appeal to parents seeking to reduce travel expenses

Physical tuition centres may choose to supplement their in-person tuition offer with online courses and classes. With a combined focus on digital and face-to-face delivery, GoStudent is a European market leader in hybrid learning.

Becoming a GoStudent partner

The GoStudent Parnership Program is at the innovational forefront of educational technology and business development. The company's reputation has been forged through the highest quality online tuition services, which serve as a tried-and-tested support for franchisees looking to launch, grow and invest in centres that offer hybrid tuition models. Always looking to the future, GoStudent is a European leader in the creation of AI tutors as a complement to human-taught classes.

GoStudent in numbers

• GoStudent has helped over 10 million families across Europe

• We over 30 different subjects across a range of study levels

• Our platform has over 23 thousand DBS-checked tutors

• The GoMigo App by GoStudent has a 4.0 star rating on Google Play. 

What do we offer?

At GoStudent, we provide comprehensive support in tuition centre setup:

• Data-driven geo-targeting advice to optimise location decisions

• Tech-forward business model committed to innovative growth

• Business plan development, training and go-to-market strategies

• Free consultation prior to commitment

In-person tuition centres naturally incur additional costs compared to online tutoring platforms. Let's explore some of the factors that need to be taken into account.

Target market: financial considerations

Having a well-defined target market is essential to calculating the start up costs of a tutoring business.

By analysing your target market, calculating your initial expenses, and understanding the legal requirements, you can design a realistic business plan that positions you to attract new students and expand your client base over time.

Age group, study levels, and subject areas directly affect the costs involved in launching and running a tuition centre:

• Younger students in primary or secondary education may require more extensive teaching materials, such as games and visual learning resources, which can increase equipment costs.

• Digital learning platforms geared towards secondary-aged students, often incur subscription costs.

• Subject-specific equipment may be required, such as art materials and musical instruments.

Taking the time to analyse your target market will give you a precise understanding of the associated costs and help you design a business plan tailored to your target audiences' needs and preferences.

GoStudent offers advanced geomarketing analysis of your chosen location, letting you to tailor your offer to local demand down to the last detail. This data-driven approach allows you to focus on taking smart financial risks, ensuring that you can invest with confidence in the areas that make an impact.

• Key segments that GoStudent focuses on include: academic tutoring, test prep, language learning and STEM

• Addressing the balance between digital teaching innovation and parental concerns over screentime, GoStudent tuition centres leverage the advantages of educational tech and AI to optimise learning while meeting growing demand for offline study experiences

• Cost-effective localised marketing campaigns help protect against losses.

Choosing to invest in a GoStudent tuition centre is an investment in a thriving market's dominant delivery mode, providing you with an average monthly revenue per customer of 90-150 euros.

GoStudent's dedication to data-centric research takes the guesswork out of centre setups. Boosting financial security is an integral part of the decision making process, reducing unnecessary economic losses during the initial project phase.

Annual revenue: potential earnings for different businesses

The annual revenue of a tutoring business can vary widely, depending on factors such as the number of tutoring sessions delivered within a set time period, employees' hourly rates, and whether additional tutors are hired as the business grows.

Estimated annual revenue for small, medium, and larger tutoring setups

As with many service providers, tuition centres are subject to seasonal fluctuations. To achieve sustainable growth, balance initial financial investments with projected annual revenue, adjusting marketing strategies as you attract more students and grow your client base.

Revenue can also vary significantly depending on location choice. However, opting to invest in a physical tuition centre with GoStudent doesn't mean forgoing opportunities in the digital sphere. Flexibility comes first, and as market demands change, our philosophy will always be to evolve in order to meet them.

Legislation needs: legal requirements and costs

When starting a tutoring business in the UK, compliance with legal requirements is crucial to protecting yourself, your clients, and any tutors that you employ.

Key costs include:

• Health and safety legislation – franchisees must ensure that any venues used for tutoring sessions meet safety legislation standards prior to launch, carrying out any necessary renovations to avoid costly repair work in the future.

• Disclosure and Barring Service (DBS) checks – many tuition centres in the UK cover the costs of DBS checks for the tutors that they hire. A basic check costs £21.50, with total prices varying for standard and enhances checks.

• Employment legislation – employee contracts must cover payment in the event of illness in agreement with relevant employment laws.

• Insurance – professional indemnity insurance can cover associated costs in the event of disputes or claims.

Compliance with regulations also helps to foster confidence among clients, leading to an enhanced business reputation. In order to ensure the most rigorous standards of safety and quality, all GoStudent tutors are required to undergo an enhanced DBS check.

GoStudent partnerships: an investment in learning

Launching your own tutoring business is an exciting opportunity to become your own boss and build a rewarding career.

While start up costs can vary depending on your chosen model, careful planning is key to success. We'll help you to create an exceptional marketing strategy, preparing you to provide excellent tutoring services and consistent quality that generate word of mouth referrals and long-term growth to compete with other tutoring businesses.

Become a GoStudent partner today and turn a passion for education into your own business and a full time career!

Sources:
Allied Marketing Research: Private Tutoring Market Size, Share, Competitive Landscape and Trend Analysis Report