EFL startup costs in different countries

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EFL startup costs in different countries

Unread postby orangutan » 02 Dec 2009, 09:05

I would be grateful for a rough idea of how much capital you need to start a small English school in different parts of the world where members have experience (e.g. Western Europe, Eastern Europe, S.E. Asia, Latin America).

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Re: EFL startup costs in different countries

Unread postby systematic » 19 Dec 2009, 05:12

Nobody has answered this as it is probably research you could do for yourself. Fact is, that most attempts at opening an English school abroad, end in failure. Why? mainly due to (and not necessarily in this order):
- A lack of basic business sense and/or management.
- Insufficient market research (demand, competion, loction, etc.)
- Lack of knowledge of teaching English, and/or how to hire decent staff who can.
- Lack of funds

The costs will be different in each country, mainly due to the cost/standard of living, but what you need to know and easy enough to find out are:

- Rent for premises (key-money, monthly rent/lease)
- Probable monthly electricity bill.
- Salary for permanent staff (receptionist).
- Street sign
- Window dressing
- Advertising: local TV, local Radio, local newspaper, posters, flyers, business cards,
- Office furniture: desks, chairs, filing cabinets, book shelves, cash register, safe, etc.
- Office equipment: computer(s), printers, servers, fax, copiers.
- Expendables: printing/copying paper, cleaning materials, toilet paper, coffee, sugar, milk, etc.
- Classrooms (how many bums on seats can you expect for each course?): whiteboards, desks, chairs, audio/video, LCD projector.
- Staffroom: a place for teachers to unfold, leave their briefcases, drink coffee, and say bad things amongst each other about you.
- Resources: All the teacher manuals, CDs, DVDs, and other interactive supports that come with each coursebook. general reference books for teachers such as bilingual dictionaries for the local language, TESOL handbooks for those who need to refresh themselves, photocopiable books of games and other learning material, interactive language games (enough sets to be in use in several classrooms at the same time).
- Turnover and/or local taxes
- Accountants costs
- Cost of company set up if required, or sole trader registration.
- Cost of accreditation and/or of obtaining a government licence to operate as a private school.
- Cost of buying a franchise if considering joining a chain of schools
- Number of years for ROI. (Very important to know!)
- Amount of money needed to cover all the business needs, and your living expenses for the first 6 - 12 months if the new business is slow to develop.
- You must calculate all the running costs and overheads, by the number of students you expect to teach each month, then add a profit margin: Don't rip your customers off, and don't underpay your teachers. The profit margin will be your salary plus a little bit for reinvestment in your school.
- You can't afford to pay salaries for full time teachers until you have enough classes running to keep them occupied all the time.
- You should not expect teachers to fill in with any non teaching tasks (such as reception, doing the accounts, labeling the library books, and making your coffee.

The first exercise you can do is to go through the list above based on costs in your own country. If you can afford to do it there, the costs will be similar in most Western European countries. Further afield, a little bit cheaper in the new EU countries & South America, still less in the developing countries of Asia (Cambodia, Thailand, Vietnam, Laos, Indonesia, Philmipines, etc.).

if you have enough start up capital to do it in your own country or one with a similar economy, then you will have enough, taking into account the lower cost of living, but costs of moving abroad, visas, permissions, tea-money, etc, to do it in a developing land.
Why do I know all this?
- 12 years of running my own chain of English schools along the south of France (Aix, Arles, Avignon, Carpentras, Montpellier, Nîmes, Orange, Sète).
I offer any information or advice 'as is' and hope that it has been of help. I am not an admin of this board, and my postings do not necessarily reflect the opinions of the board management.
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Re: EFL startup costs in different countries

Unread postby orangutan » 21 Dec 2009, 18:44

systematic wrote:Nobody has answered this as it is probably research you could do for yourself.

Actually it is research I am doing for myself, but I don't see any harm in asking questions here as well. :?

You provide a lot of useful advice on starting and running a language school, and I am grateful to you for sharing your experience.

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Re: EFL startup costs in different countries

Unread postby corkid » 14 Feb 2014, 10:20

In Europe we set up two schools and sold them both at a profit.
Set up costs are your rent, furniture and most importantly marketing and advertising!
We set up each one for less than 3000 euros!

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Re: EFL startup costs in different countries

Unread postby Humphries » 14 Mar 2015, 16:08

There is no price. You can buy a Wall Street franchise for a million or start with tuppence.
The problem is going on after your first set of courses dries up and finding new clients. Most teachers give it up after a couple of years and start working for an existing school.
TEFL and the business of TEFL are two different things.
And don't forget: setting up any business is hard, an it often fails

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Re: EFL startup costs in different countries

Unread postby pena5241 » 18 May 2015, 21:30

It's unbelievable how startup costs can go from 3000 Euros (as mentioned above) up to half a million or more as in the case of Wall Street (coincidentally I was just checking for Wall Street franchises and the startup costs are 300,000 to 500,000 USD).
I'm seriously thinking of starting an English school but since I have only "worked" as an English teacher while teaching English to my kids and wife, i.e. I have no real experience, I first thought about buying a franchise however given the high cost of the franchise fee and the high cost of the building the classrooms (because most franchises want to to build lots of classrooms) I guess I'll better do it on my own and use as working capital the money I'd otherwise spend for the franchise fee.
Thanks to systematic and corkid for the useful information.

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