Conduct A Feasibility Study Before Starting A School: Avoid Failure And Experience Success
Many entrepreneurs, including education entrepreneurs who start schools, believe that feasibility studies are unnecessary. They are absolutely convinced that they have a fabulous idea that will be successful. In fact, highly sophisticated business plans support their perspectives. Yet between 50% and 80% of businesses fail within the first few years. The global landscape is littered with failed schools.
A feasibility study can help avoid failure. Done correctly, it will do more than avoid failure - it will establish the conditions essential for a successful school startup and operation for many years to come.
A market study is absolutely essential. It's not enough to know that there is a demand for education in the area. The study must analyze the many variables that parents consider in determining whether to enroll their children in a school. Selling education is not like selling widgets. For most parents, nothing is more important than the education of their children. Parents will look at their options and decide which one is best for them, affordable and worth the price. They will carefully consider variables like the kind of education, facilities, location, hours of operation, transportation services, extracurricular activities, etc. in their decision making process. Education entrepreneurs need an in-depth understanding of the marketplace and the complex considerations of prospective parents before launching a school. A good feasibility provides this information and informs the school formation and startup process.
Startup and operating requirements must also be laid out clearly in a feasibility study. Facilities acquisition, design and development, management structure, faculty and staff recruitment, supervision and compensation, marketing and admission, student management systems and more require careful consideration. A comprehensive, impartial analysis of project requirements is essential. Great care must be taken to avoid underestimating the necessary resources to ensure success and avoid failure.
The financial analysis should include startup and annual operating budgets for five years. Ideally, the projections would include best, medium and worse case scenarios. The projections must include the assumptions that form the basis for the projections. It is important to consider industry benchmarks in developing the financial projections. Budgets with projections far outside industry ranges for major expenses and growth projections are serious red flags. A break-even analysis is also critical. A comprehensive, professional financial analysis will help startup schools avoid pitfalls and provide critical information for what is and what is not feasible
The main reasons schools fail include 1) underestimating the competition, 2) poor execution, 3) undercapitalization, and 4) lack of competitive advantages. An excellent feasibility study will help you avoid failure and experience success.
A feasibility study can help avoid failure. Done correctly, it will do more than avoid failure - it will establish the conditions essential for a successful school startup and operation for many years to come.
A market study is absolutely essential. It's not enough to know that there is a demand for education in the area. The study must analyze the many variables that parents consider in determining whether to enroll their children in a school. Selling education is not like selling widgets. For most parents, nothing is more important than the education of their children. Parents will look at their options and decide which one is best for them, affordable and worth the price. They will carefully consider variables like the kind of education, facilities, location, hours of operation, transportation services, extracurricular activities, etc. in their decision making process. Education entrepreneurs need an in-depth understanding of the marketplace and the complex considerations of prospective parents before launching a school. A good feasibility provides this information and informs the school formation and startup process.
Startup and operating requirements must also be laid out clearly in a feasibility study. Facilities acquisition, design and development, management structure, faculty and staff recruitment, supervision and compensation, marketing and admission, student management systems and more require careful consideration. A comprehensive, impartial analysis of project requirements is essential. Great care must be taken to avoid underestimating the necessary resources to ensure success and avoid failure.
The financial analysis should include startup and annual operating budgets for five years. Ideally, the projections would include best, medium and worse case scenarios. The projections must include the assumptions that form the basis for the projections. It is important to consider industry benchmarks in developing the financial projections. Budgets with projections far outside industry ranges for major expenses and growth projections are serious red flags. A break-even analysis is also critical. A comprehensive, professional financial analysis will help startup schools avoid pitfalls and provide critical information for what is and what is not feasible
The main reasons schools fail include 1) underestimating the competition, 2) poor execution, 3) undercapitalization, and 4) lack of competitive advantages. An excellent feasibility study will help you avoid failure and experience success.