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Private Schools Business Plan

Published Jul.26, 2024

Updated Oct.04, 2024

By: Jakub Babkins

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Private Schools Business Plan

Table of Content

Introduction

Starting a private school is a challenging yet rewarding venture that requires a well-thought-out business plan. A comprehensive business plan serves as the blueprint for your school’s operations, helping to attract investors, secure funding, and ensure the long-term success of your educational institution. This guide will provide detailed insights into developing a robust business plan for a private school, from market evaluation to financial planning, operational strategies, and more.

What is a Private School Business Plan?

A private school business plan is a strategic document outlining the objectives, strategies, and operational plans for starting and running a private school. It includes various sections such as market analysis, organizational structure, marketing strategy, financial projections, and more. A well-prepared pitch deck can enhance your business plan presentation, showcasing your school’s unique value to potential investors.

Are Private Schools a Business?

Private schools operate like businesses in many respects. They require a solid business strategy to manage finances, attract students, hire qualified staff, and maintain facilities. While their primary goal is to provide quality education, they must also ensure financial viability and sustainability. Establishing international partnerships or attracting foreign educators might involve looking into options such as the EB2 business visa to bring in skilled personnel and investors.

Market Evaluation

Before starting a private school, it’s essential to conduct a thorough market evaluation. This involves analyzing the demand for private education in your target area, understanding the competitive landscape, and identifying potential opportunities and challenges.

Demographic Analysis

Understanding the demographics of your target market is crucial. Consider factors such as population size, income levels, and educational preferences. For instance, if you are planning to open a private school in a suburban area with a growing population of young families, there may be a high demand for quality private education.

Competitive Analysis

Analyze the existing private schools in your area. Identify their strengths and weaknesses, their tuition fees, the programs they offer, and their overall reputation. This will help you identify gaps in the market and differentiate your school from competitors. For those considering international expansion or attracting investors from other countries, exploring the E2 visa can facilitate the involvement of foreign partners in your school’s operations.

Insights into the Private School Industry

The private school industry is diverse, with schools varying in size, curriculum, religious affiliation, and more. According to the National Center for Education Statistics (NCES), private schools enroll approximately 4.7 million students in the United States, accounting for 10% of the K-12 student population. Understanding industry trends and challenges is crucial for developing a successful business plan.

Key Trends in Private Education

  • Personalized Learning: Increasing demand for personalized and individualized learning experiences.
  • Technological Integration: Growing use of technology in classrooms to enhance learning.
  • Focus on STEM Education: Emphasis on science, technology, engineering, and mathematics (STEM) programs.

Challenges Faced by Private Schools

  • Funding and Financial Sustainability: Ensuring a steady stream of revenue through tuition fees, donations, and grants.
  • Student Recruitment and Retention: Attracting and retaining students in a competitive market.
  • Compliance and Accreditation: Meeting regulatory requirements and obtaining necessary accreditations.

Developing Your Business Plan

Creating a detailed business plan for school involves several key components. Here’s a step-by-step guide to help you get started.

Executive Summary

The executive summary provides an overview of your business plan, including your school’s mission statement, the target market, the unique value proposition, and financial highlights. It should be concise yet comprehensive, capturing the essence of your plan.

Mission Statement

Your mission statement should reflect the core values and educational philosophy of your school. It should convey your commitment to providing quality education and fostering a nurturing learning environment.

Organizational Structure

Outline the organizational structure of your school, including the management team, teaching staff, administrative personnel, and support staff. Define the roles and responsibilities of each team member to ensure a clear understanding of the organizational hierarchy.

Marketing Strategy

Your marketing strategy should detail how you plan to attract and retain students. This includes branding, advertising, public relations, and community outreach.

Branding and Positioning

Develop a strong brand identity that reflects the values and mission of your school. This includes creating a logo, tagline, and marketing materials that resonate with your target audience.

Advertising and Promotions

Utilize various advertising channels to promote your school, such as social media, print media, radio, and online advertising. Consider hosting open houses and informational sessions to attract prospective students and their families.

Community Outreach

Engage with the local community through partnerships, sponsorships, and participation in community events. Building strong relationships with community members can help enhance your school’s reputation and visibility.

Financial Plan

The financial plan is a critical component of your business plan. It outlines your budget, revenue projections, and funding requirements.

Develop a detailed budget that includes all operational expenses, such as salaries, utilities, supplies, and maintenance. Ensure that your budget is realistic and accounts for potential fluctuations in enrollment and revenue, as outlined in a private school business plan sample.

Revenue Projections

Project your school’s revenue based on expected tuition fees, donations, grants, and other sources of income. Consider different scenarios, such as varying enrollment numbers, to prepare for potential challenges.

Funding Requirements

Identify your funding requirements and potential sources of funding. This may include loans, grants, donations, and investments. Be prepared to present a compelling case to potential investors or donors, highlighting the unique value and impact of your school.

Operational Plan

The operational plan outlines the day-to-day operations of your school, including the academic calendar, curriculum, extracurricular activities, and facilities management.

Academic Calendar

Develop a comprehensive academic calendar that includes key dates such as the start and end of the school year, holidays, exams, and special events.

Curriculum Development

Design a curriculum that meets the educational standards and requirements of your target market. Consider incorporating innovative teaching methods and technologies to enhance the learning experience.

Extracurricular Activities

Offer a variety of extracurricular activities to support the holistic development of your students. This may include sports, arts, clubs, and community service opportunities.

Facilities Management

Ensure that your school’s facilities are well-maintained and equipped to provide a safe and conducive learning environment. This includes classrooms, libraries, laboratories, and recreational areas.

Get Started with OGS Capital Today

Ready to start your private school journey? Get started with OGS Capital today. Our team of experts can help you develop a comprehensive private school business plan that sets your school up for success. Contact us to learn more about our services and how we can assist you in bringing your vision to life.

Developing a business plan for a private school is a complex but essential step in ensuring the success and sustainability of your educational institution. By conducting thorough market research, developing a strong organizational structure, implementing effective marketing strategies, and maintaining sound financial planning, you can create a thriving private school that meets the needs of your students and community.

Q. Is private school a good investment?  

Investing in a private school can be highly beneficial due to the potential for providing high-quality education and the ability to cater to specific educational needs. Many parents are willing to pay a premium for superior academic programs, personalized attention, and specialized facilities, making private schools a valuable investment. However, success requires a solid business plan for private school, effective management, and continuous improvement in educational offerings.

Q. How do private school owners make money?  

Private school owners primarily generate revenue through tuition fees, which are often higher than those of public schools. Additionally, they may receive income from donations, grants, and fundraising activities. Some schools also offer after-school programs, summer camps, and extracurricular activities, which can provide additional revenue streams. Effective financial management and strategic planning for private schools are essential for sustaining profitability and growth.

OGSCapital’s team has assisted thousands of entrepreneurs with top-rated document, consultancy and analysis. They’ve helped thousands of SME owners secure more than $1.5 billion in funding, and they can do the same for you.

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Let's make sure your independent educational institution will be profitable!

Here is a free business plan sample for a private school

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If the idea of shaping young minds and establishing a thriving educational community excites you, then launching a private school might be your calling.

In the following paragraphs, we will guide you through a comprehensive business plan tailored for a private school.

As an aspiring educational entrepreneur, you must recognize that a robust business plan is crucial for laying the foundation of a successful institution. It serves as a roadmap, detailing your educational philosophy, operational strategies, and financial projections.

To streamline your planning process, you can utilize our private school business plan template. Our team of experts is also on standby to provide a complimentary review and offer suggestions for improvement.

business plan high school

How to draft a great business plan for your private school project?

A good business plan for a private school must reflect the unique aspects of educational services.

To start, it is crucial to provide a comprehensive overview of the educational market. This includes offering up-to-date statistics and identifying emerging trends in the education sector, as illustrated in our private school business plan template .

Then, you should articulate your educational philosophy and mission. This encompasses your vision, identifying your target demographic (for example, local families, international students, students with special educational needs), and the distinct educational approach of your school (progressive, traditional, Montessori, International Baccalaureate, etc.).

The next section should delve into market analysis. This requires a thorough understanding of local educational options, demographic trends, and parental preferences.

For a private school, particular emphasis should be placed on the curriculum and extracurricular programs you plan to offer. Detail your academic programs, sports, arts, and other activities, and explain how they cater to the needs and aspirations of your student body.

The operational plan is equally important. It should outline the location of your school, the design and facilities of the campus, faculty recruitment, and the student enrollment process.

For a private school, it is important to highlight the qualifications of your teaching staff, educational methodologies, and standards for student safety and welfare.

Then, address your marketing and enrollment strategy. How will you attract new students and retain current ones? Consider promotional methods, community engagement, and alumni relations.

Adopting digital strategies, such as a user-friendly website or active social media engagement, is also vital in the modern landscape.

The financial structure is another critical component. This includes the initial investment, tuition fee structure, operational expenses, and the point at which the school becomes financially sustainable.

In a private school, managing cash flow is essential, as there may be significant upfront costs before tuition fees are received. Therefore, careful financial planning is imperative. For assistance, refer to our financial forecast for a private school .

Compared to other business plans, a private school's plan must pay special attention to accreditation requirements, educational standards, and long-term student outcomes.

A well-crafted business plan will assist the school founder not only in refining their vision and strategies but also in attracting investors or securing loans.

Lenders and investors seek robust market analysis, realistic financial projections, and a clear understanding of the school's day-to-day operations.

By presenting a thorough and substantiated plan, you showcase your credibility and dedication to the educational venture's success.

To achieve these goals while saving time, simply fill out our private school business plan template .

business plan private school project

A free example of business plan for a private school

Here, we will provide a concise and illustrative example of a business plan for a specific project.

This example aims to provide an overview of the essential components of a business plan. It is important to note that this version is only a summary. As it stands, this business plan is not sufficiently developed to support a profitability strategy or convince a bank to provide financing.

To be effective, the business plan should be significantly more detailed, including up-to-date market data, more persuasive arguments, a thorough market study, a three-year action plan, as well as detailed financial tables such as a projected income statement, projected balance sheet, cash flow budget, and break-even analysis.

All these elements have been thoroughly included by our experts in the business plan template they have designed for a private school .

Here, we will follow the same structure as in our business plan template.

business plan private school project

Market Opportunity

Market data and figures.

The private education sector is a significant and growing market globally.

Recent estimates suggest that the global private schooling market is valued at over 500 billion dollars, with expectations for continued growth as more parents seek specialized and high-quality education for their children.

In the United States, there are over 34,000 private schools, serving 5.7 million PK-12 students, and accounting for 25% of the nation's schools and 10% of all PK-12 students.

These statistics underscore the critical role private schools play in the educational landscape and their substantial contribution to the economy.

Emerging trends in the education sector indicate a shift towards personalized and technologically integrated learning experiences.

There is a growing emphasis on STEM (Science, Technology, Engineering, and Mathematics) education, with schools investing in advanced science labs and computer programming courses to prepare students for the future job market.

Additionally, the rise of digital learning platforms and educational software is transforming traditional teaching methods, allowing for more interactive and student-centered learning.

Environmental education and sustainability are also becoming integral parts of school curricula, reflecting the increasing awareness of global environmental issues.

Moreover, there is a heightened focus on mental health and well-being, with schools incorporating mindfulness practices and social-emotional learning into their programs.

These trends demonstrate how private schools are evolving to meet the educational needs and expectations of a new generation of students and parents.

Success Factors

The success of a private school hinges on several critical elements.

Foremost, the quality of education provided, including the qualifications of teachers and the rigor of academic programs, is paramount in attracting and retaining students.

Innovation in curriculum design and the integration of technology into the classroom are also vital in setting a school apart in a competitive market.

The location and facilities of a school can significantly influence its appeal to potential students and their families.

Exceptional student services and support, including extracurricular activities and college counseling, are essential for fostering a well-rounded educational experience.

Lastly, effective financial management, commitment to sustainability, and the ability to adapt to the evolving educational landscape are key factors for ensuring the long-term success and reputation of a private school.

The Project

Project presentation.

Our private school project is designed to provide a superior educational experience tailored to the needs of students in a nurturing and inclusive environment. Situated in a community with a growing demand for quality education, our school will offer a comprehensive curriculum from kindergarten to high school, with a focus on holistic development, critical thinking, and academic excellence.

The school will feature state-of-the-art facilities, small class sizes for personalized attention, and a diverse range of extracurricular activities to promote well-rounded growth.

Our private school aims to be recognized as a leading institution that not only imparts knowledge but also instills values and life skills essential for the success of our future leaders.

Value Proposition

The value proposition of our private school lies in its commitment to fostering an environment where students can excel academically while developing socially and emotionally. We offer a unique blend of rigorous academics, innovative technology integration, and a strong emphasis on character education.

Our dedication to cultivating a passion for lifelong learning and providing a supportive community ensures that each student reaches their full potential. We strive to prepare our students for the challenges of higher education and the global workforce.

By investing in the best educational practices and resources, we are determined to make a significant and positive impact on the lives of our students and their families, setting a new standard for private education in our community.

Project Owner

The project owner is an experienced educator with a visionary approach to teaching and learning. With a background in educational leadership and a commitment to academic excellence, they are passionate about creating a school that reflects the highest standards of education.

Having worked in various educational settings, the project owner brings a wealth of knowledge in curriculum development, student engagement, and community involvement. They are dedicated to building a school that not only meets but exceeds the expectations of students, parents, and the community at large.

With a firm belief in the transformative power of education, the project owner is the driving force behind this initiative, committed to shaping a future where every student has access to an education that empowers them to achieve their dreams.

The Market Study

Target demographics.

The target demographics for our private school encompass a variety of groups.

Primarily, we cater to families valuing high-quality education and seeking an alternative to public schooling for their children.

Additionally, we serve parents looking for specialized curriculums that focus on individual learning styles and advanced educational approaches.

Our school also attracts families interested in a safe and nurturing environment that promotes character development alongside academic excellence.

Lastly, educators and professionals in the field of child development can become advocates for our institution, recommending it to parents who desire a tailored educational experience for their children.

SWOT Analysis

A SWOT analysis of our private school project highlights several key factors.

Strengths include a dedicated and experienced faculty, a robust curriculum that exceeds standard educational models, and a commitment to student success.

Weaknesses may involve the higher tuition costs compared to public schools and the challenge of maintaining small class sizes for personalized attention.

Opportunities exist in the growing demand for alternative education options and the potential to incorporate innovative teaching methods and technology.

Threats could encompass changes in educational regulations, competition from other private and charter schools, and the economic factors that may affect families' ability to afford private education.

Competitor Analysis

Competitor analysis within the private education sector indicates a competitive landscape.

Direct competitors include other private schools, charter schools, and magnet programs that offer unique or specialized educational experiences.

These institutions compete on the basis of academic reputation, extracurricular offerings, and the quality of their facilities and resources.

Potential competitive advantages for our school include a low student-to-teacher ratio, a strong sense of community, innovative educational programs, and a commitment to holistic student development.

Understanding the strengths and weaknesses of our competitors is crucial for carving out a niche in the market and ensuring high retention and satisfaction rates among our students and their families.

Competitive Advantages

Our private school's competitive advantages lie in our dedication to providing a comprehensive and personalized educational experience.

We offer a broad and diverse curriculum that includes advanced STEM programs, arts, and humanities, all taught by highly qualified educators.

Our focus on fostering a supportive and inclusive community helps students thrive both academically and socially.

We are committed to transparency in our educational practices and policies, which builds trust with our families and ensures a collaborative approach to each student's success.

You can also read our articles about: - the customer segments of a private school - the competition study for a private school

The Strategy

Development plan.

Our three-year development plan for the private school is designed to establish a strong educational foundation and reputation.

In the first year, we will concentrate on building a robust curriculum and recruiting qualified educators, while also focusing on student enrollment and community engagement.

The second year will be dedicated to enhancing our extracurricular programs and integrating technology into our teaching methods to provide a well-rounded education.

In the third year, we aim to expand our facilities to accommodate more students and introduce specialized programs to cater to diverse learning needs.

Throughout this period, we will commit to excellence in education, fostering a nurturing environment, and adapting to the evolving educational landscape to serve our students and their families effectively.

Business Model Canvas

The Business Model Canvas for our private school targets families seeking quality education, personalized learning experiences, and a safe environment for their children.

Our value proposition is centered on providing a superior educational experience, with a focus on individual student growth and preparation for higher education and life beyond school.

We offer our educational services through our campus facilities, supplemented by online resources and platforms to enhance learning.

Key activities include curriculum development, teaching, student support services, and community involvement.

Our revenue streams are derived from tuition fees, fundraising events, and grants, while our costs are primarily associated with faculty salaries, facility maintenance, and educational resources.

Access a detailed and customizable real Business Model Canvas in our school's business plan template .

Marketing Strategy

Our marketing strategy is centered on showcasing the quality of our educational offerings and the success of our students.

We aim to engage with local families through open house events, community partnerships, and showcasing student achievements.

We will also leverage digital marketing, including a strong social media presence and targeted ads, to reach potential new families.

Additionally, we plan to build relationships with local businesses and educational institutions to create a network of support and opportunities for our students.

Our goal is to create a reputable brand that is synonymous with academic excellence and holistic development.

Risk Policy

The risk policy for our private school focuses on mitigating risks related to student safety, academic quality, and financial stability.

We implement rigorous safety protocols and emergency preparedness plans to ensure the well-being of our students and staff.

Academic risks are managed through continuous curriculum assessment and teacher training to maintain high educational standards.

Financial risks are addressed through prudent budgeting, diversified revenue streams, and maintaining a reserve fund for unforeseen expenses.

We also carry comprehensive insurance to protect against potential liabilities. Our priority is to provide a secure and high-quality educational environment for our students.

Why Our Project is Viable

We are committed to establishing a private school that meets the growing demand for personalized and high-quality education.

With our focus on academic excellence, student well-being, and community involvement, we are confident in our school's potential for success.

We are passionate about shaping the future leaders of tomorrow and are prepared to adapt to the educational needs of our students.

We are optimistic about the impact our school will have on the community and the lasting legacy it will create.

You can also read our articles about: - the Business Model Canvas of a private school - the marketing strategy for a private school

The Financial Plan

Of course, the text presented below is far from sufficient to serve as a solid and credible financial analysis for a bank or potential investor. They expect specific numbers, financial statements, and charts demonstrating the profitability of your project.

All these elements are available in our business plan template for a private school and our financial plan for a private school .

Initial expenses for our private school include the acquisition or leasing of a suitable campus, classroom and office equipment, educational materials and technology, renovations to ensure a safe and conducive learning environment, hiring qualified teaching and administrative staff, and costs associated with branding and marketing to attract students and establish our school's reputation.

Our revenue assumptions are based on a thorough analysis of the local demand for private education, taking into account factors such as the quality of public education, the socio-economic status of families in the area, and the unique educational programs we offer.

We anticipate a gradual increase in student enrollment, starting with a conservative number and expanding as our school's reputation for excellence grows.

The projected income statement outlines expected tuition fees and other sources of revenue, direct educational costs (teacher salaries, educational materials, technology), and operating expenses (facility maintenance, administrative costs, marketing, etc.).

This results in a forecasted net profit that is essential for assessing the long-term sustainability and profitability of our private school.

The projected balance sheet reflects assets specific to our school, such as educational equipment, technology, and campus facilities, and liabilities including loans and anticipated operational expenses.

It provides a snapshot of the overall financial health of our private school at the end of each fiscal period.

Our projected cash flow statement details the inflows and outflows of cash, enabling us to predict our financial needs at any given time. This will assist us in managing our finances effectively and preventing liquidity issues.

The projected financing plan identifies the specific sources of funds we intend to utilize to cover our startup and operational expenses.

The working capital requirement for our private school will be meticulously managed to ensure we have sufficient liquidity to support our day-to-day operations, including purchasing educational materials, managing inventory, and paying staff salaries.

The break-even point for our school is the number of students needed to enroll to cover all our costs, including startup expenses, and begin generating a profit.

It will signal the point at which our school becomes financially viable.

Performance indicators we will monitor include the student-to-teacher ratio to ensure quality education, the retention rate of students to measure satisfaction and success, and the return on investment to evaluate the efficiency of the capital invested in our educational venture.

These indicators will aid us in assessing the financial health and overall success of our private school.

If you want to know more about the financial analysis of this type of activity, please read our article about the financial plan for a private school .

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School Business Plan Template

Written by Dave Lavinsky

private school business plan

School Business Plan

Over the past 20+ years, we have helped over 500 entrepreneurs and business owners create business plans to start and grow their schools.

If you’re unfamiliar with creating a school business plan, you may think creating one will be a time-consuming and frustrating process. For most entrepreneurs it is, but for you, it won’t be since we’re here to help. We have the experience, resources, and knowledge to help you create a great business plan.

In this article, you will learn some background information on why business planning is important. Then, you will learn how to write a school business plan step-by-step so you can create your plan today.

Download our Ultimate Business Plan Template here >

What is a School Business Plan?

A business plan provides a snapshot of your school as it stands today, and lays out your growth plan for the next five years. It explains your business goals and your strategies for reaching them. It also includes market research to support your plans.

Why You Need a Business Plan for a School

If you’re looking to start a school or grow your existing school, you need a business plan. A business plan will help you raise funding, if needed, and plan out the growth of your school to improve your chances of success. Your school business plan is a living document that should be updated annually as your company grows and changes.

Sources of Funding for Schools

With regards to funding, the main sources of funding for schools are donations and gifts, tuition, personal savings, credit cards, bank loans, and angel investors. When it comes to bank loans, banks will want to review your business plan and gain confidence that you will be able to repay your loan and interest. To acquire this confidence, the loan officer will not only want to ensure that your financials are reasonable, but they will also want to see a professional plan. Such a plan will give them the confidence that you can successfully and professionally operate a business. Personal savings and bank loans are the most common funding paths for schools.

Finish Your Business Plan Today!

How to Write a Business Plan for a School

If you want to start a school or expand your current one, you need a business plan. The guide below details the necessary information for how to write each essential component of your school business plan.

Executive Summary

Your executive summary provides an introduction to your business plan, but it is normally the last section you write because it provides a summary of each key section of your plan.

The goal of your executive summary is to quickly engage the reader. Explain to them the kind of school you are running and the status. For example, are you a startup, do you have a school that you would like to grow, or are you operating a chain of schools?

Next, provide an overview of each of the subsequent sections of your plan.

  • Give a brief overview of the school industry.
  • Discuss the type of school you are operating.
  • Detail your direct competitors. Give an overview of your target customers.
  • Provide a snapshot of your marketing strategy. Identify the key members of your team.
  • Offer an overview of your financial plan.

Company Overview

In your company overview, you will detail the type of school you are operating.

For example, you might specialize in one of the following types of schools:

  • Private K-12 school : this type of school typically charges tuition, and may be affiliated with a religious organization, or specialize in a particular learning method.
  • Charter school: this type of school offers primary or secondary education for a tuition, and may receive some public funding, and/or donations. These schools require their students to take state-mandated exams.
  • Special subject school: this type of school specializes in teaching a specific subject, such as driving, first-aid, self-defense, fine arts, language, or general tutoring.
  • Preschool: this type of school typically serves children who are aged 3 and 4. These schools prepare young children to enter formal education, and are funded by some combination of tuition, donations, and government grants.

In addition to explaining the type of school you will operate, the company overview needs to provide background on the business.

Include answers to questions such as:

  • When and why did you start the business?
  • What milestones have you achieved to date? Milestones could include the number of students served, the number of students accepted into elite formal education institutions, etc.
  • Your legal business Are you incorporated as an S-Corp? An LLC? A sole proprietorship? Explain your legal structure here.

Industry Analysis

In your industry or market analysis, you need to provide an overview of the school industry.

While this may seem unnecessary, it serves multiple purposes.

First, researching the school industry educates you. It helps you understand the market in which you are operating.

Secondly, market research can improve your marketing strategy, particularly if your analysis identifies market trends.

The third reason is to prove to readers that you are an expert in your industry. By conducting the research and presenting it in your plan, you achieve just that.

The following questions should be answered in the industry analysis section of your school business plan:

  • How big is the school industry (in dollars)?
  • Is the market declining or increasing?
  • Who are the key competitors in the market?
  • Who are the key suppliers in the market?
  • What trends are affecting the industry?
  • What is the industry’s growth forecast over the next 5 – 10 years?
  • What is the relevant market size? That is, how big is the potential target market for your school? You can extrapolate such a figure by assessing the size of the market in the entire country and then applying that figure to your local population.

Customer Analysis

The customer analysis section of your school business plan must detail the customers you serve and/or expect to serve.

The following are examples of customer segments: families with elementary-aged children, families with high-school-aged children, families with preschool children.

As you can imagine, the customer segment(s) you choose will have a great impact on the type of school you operate. Clearly, families with high schoolers would respond to different marketing promotions than families with preschoolers, for example.

Try to break out your target customers in terms of their demographic and psychographic profiles. With regards to demographics, including a discussion of the ages, genders, locations, and income levels of the potential customers you seek to serve.

Psychographic profiles explain the wants and needs of your target customers. The more you can recognize and define these needs, the better you will do in attracting and retaining your customers.

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Competitive Analysis

Your competitive analysis should identify the indirect and direct competitors your business faces and then focus on the latter.

Direct competitors are other schools.

Indirect competitors are other options that customers have to purchase from that aren’t directly competing with your product or service. This includes public schools, virtual schools, and families who do homeschooling. You need to mention such competition as well.

For each such competitor, provide an overview of their business and document their strengths and weaknesses. Unless you once worked at your competitors’ businesses, it will be impossible to know everything about them. But you should be able to find out key things about them such as

  • What types of students do they serve?
  • What type of school are they?
  • What is their pricing (premium, low, etc.)?
  • What are they good at?
  • What are their weaknesses?

With regards to the last two questions, think about your answers from the customers’ perspective. And don’t be afraid to ask your competitors’ customers what they like most and least about them.

The final part of your competitive analysis section is to document your areas of competitive advantage. For example:

  • Will you provide specialized instruction, either in subject or in method?
  • Will you offer courses or services that your competition doesn’t?
  • Will you provide better customer service?
  • Will you offer better pricing?

Think about ways you will outperform your competition and document them in this section of your plan.  

Marketing Plan

Traditionally, a marketing plan includes the four P’s: Product, Price, Place, and Promotion. For a school business plan, your marketing strategy should include the following:

Product : In the product section, you should reiterate the type of school that you documented in your company overview. Then, detail the specific products or services you will be offering. For example, will you provide religious-focused K-8 education, college preparatory courses, or single-subject instruction like driving or fine arts?

Price : Document the prices you will offer and how they compare to your competitors. Essentially in the product and price sub-sections of your plan, you are presenting the courses and/or extracurricular activities you offer and their prices.

Place : Place refers to the site of your school. Document where your company is situated and mention how the site will impact your success. For example, is your school located in a growing neighborhood, in the city center, or will you operate purely online? Discuss how your site might be the ideal location for your customers.

Promotions : The final part of your school marketing plan is where you will document how you will drive potential customers to your location(s). The following are some promotional methods you might consider:

  • Advertise in local papers, radio stations and/or magazines
  • Reach out to websites
  • Distribute flyers
  • Engage in email marketing
  • Advertise on social media platforms
  • Improve the SEO (search engine optimization) on your website for targeted keywords

Operations Plan

While the earlier sections of your business plan explained your goals, your operations plan describes how you will meet them. Your operations plan should have two distinct sections as follows.

Everyday short-term processes include all of the tasks involved in running your school, including answering calls, planning and delivering instruction, applying for grants, fundraising, performing administrative tasks, overseeing instructors, handling discipline, scheduling and monitoring extracurricular activities, etc.

Long-term goals are the milestones you hope to achieve. These could include the dates when you expect to enroll your Xth student, or when you hope to reach $X in revenue. It could also be when you expect to expand your school to a new city.  

Management Team

To demonstrate your school’s potential to succeed, a strong management team is essential. Highlight your key players’ backgrounds, emphasizing those skills and experiences that prove their ability to grow a company.

Ideally, you and/or your team members have direct experience in managing schools. If so, highlight this experience and expertise. But also highlight any experience that you think will help your business succeed.

If your team is lacking, consider assembling an advisory board. An advisory board would include 2 to 8 individuals who would act as mentors to your business. They would help answer questions and provide strategic guidance. If needed, look for advisory board members with experience in running a school or experience with public school administration or who has served on a public school board.  

Financial Plan

Your financial plan should include your 5-year financial statement broken out both monthly or quarterly for the first year and then annually. Your financial statements include your income statement, balance sheet, and cash flow statements.

Income Statement

An income statement is more commonly called a Profit and Loss statement or P&L. It shows your revenue and then subtracts your costs to show whether you turned a profit or not.

In developing your income statement, you need to devise assumptions. For example, will you enroll 100 or 1,000 students per semester, and/or offer extracurricular activities? And will sales grow by 2% or 10% per year? As you can imagine, your choice of assumptions will greatly impact the financial forecasts for your business. As much as possible, conduct research to try to root your assumptions in reality.

Balance Sheets

Balance sheets show your assets and liabilities. While balance sheets can include much information, try to simplify them to the key items you need to know about. For instance, if you spend $50,000 on building out your school, this will not give you immediate profits. Rather it is an asset that will hopefully help you generate profits for years to come. Likewise, if a lender writes you a check for $50,000, you don’t need to pay it back immediately. Rather, that is a liability you will pay back over time.

Cash Flow Statement

Your cash flow statement will help determine how much money you need to start or grow your business, and ensure you never run out of money. What most entrepreneurs and business owners don’t realize is that you can turn a profit but run out of money and go bankrupt.

When creating your Income Statement and Balance Sheets be sure to include several of the key costs needed in starting or growing a school:

  • Cost of equipment and supplies
  • Payroll or salaries paid to staff
  • Business insurance
  • Other start-up expenses (if you’re a new business) like legal expenses, permits, computer software, and equipment

Attach your full financial projections in the appendix of your plan along with any supporting documents that make your plan more compelling. For example, you might include your school location lease or a list of elective courses or extracurricular activities you will offer.  

Writing a business plan for your school is a worthwhile endeavor. If you follow the template above, by the time you are done, you will truly be an expert. You will understand the school industry, your competition, and your customers. You will develop a marketing strategy and will understand what it takes to launch and grow a successful school.

Don’t you wish there was a faster, easier way to finish your School business plan?

OR, Let Us Develop Your Plan For You

Since 1999, Growthink has developed business plans for thousands of companies who have gone on to achieve tremendous success.   Learn about Growthink’s business plan writing services .

Other Helpful Business Plan Articles & Templates

Business Plan Template

For Profit vs Not for Profit Schools

Private schools are generally organized as for-profit or not-for-profit (nonprofit) entities. The for-profit version is typically used by a corporation or a private individual to make a profit but not be eligible for tax-deductible contributions to the extent provided by law. Most private schools choose to organize under not-for-profit status so that they may make money but also receive tax-deductible donations to the extent provided by law.

What are the advantages and disadvantages of a for-profit versus a nonprofit school? Is one kind of school better than the other?

For-Profit Schools

A for-profit school is set up by allowing it to be controlled by an owner. That owner could be an individual or group of individuals, as is often the case with many pre-schools and some elementary schools. Another form of ownership is a corporation. This often is a corporation owned and operated by a group of local individuals. More typically, for-profit private schools are owned by a corporation that has schools in several locations. For-profit schools are usually in business to make money or turn a profit. They pay taxes on those profits. Parents pay for the school's services just as though they were customers. Examples of this sort of school include Le Rosey in Switzerland , Sylvan Learning Centers , the Nobel Schools, and thousands of small nursery and primary schools. The school can be incorporated, a sole proprietorship, or some other form of ownership.

Here is a brief explanation of how businesses are organized.

The advantage of private for-profit school ownership is that the owner calls the shots and controls everything. Parents who dislike what is offered can take their children elsewhere. Parental input may be sought and entertained, but the final decisions and control rest with the owner.

Not For Profit Schools

Once incorporated, most not-for-profit private schools seek 501(c)(3) status from the IRS. This nonprofit status exempts the entity from federal, state, and local taxes. It also permits the school to accept contributions, which are tax-deductible to the extent provided by law. Not-for-profit status was designed for entities that operate for the greater good of the community. A school generally meets that test.

This video explains what is involved in setting up a not-for-profit corporation.

Why do schools need tax-exempt status? Donors are much more likely to give money to an institution when their contributions are tax-deductible. This is particularly true of major donors. For this essay, I characterize major gifts as $25,000 or more.

Some schools are set up so that parents own shares in the corporation. The ownership formulae vary, but most seem to depend on the number of children enrolled.

Most not-for-profit schools will have an active board of trustees. The trustees are the mechanism by which the school is governed. Depending on how the charter is set up, its powers will be extensive. The board of trustees hires a head of school at such an institution. This governance mechanism allows the school to outlive its founder and, all things being equal, last for generations. Examples of this sort of school include Kent School, founded by Father Frederick Herbert Sill in 1906, and Exeter Academy, founded by John Phillips in 1781.

Does it matter whether a school is for-profit or not for profit?

No! One kind of school is not better than another. A school's success is measured intrinsically by its teaching, achievements, and satisfied parents and students, not its governance.

It also does not matter for one other essential reason. What is that? The reasons you are considering sending your child to a private school have nothing to do with the legal manner in which schools are set up. As long as the school operates legally, that's all you need to be concerned about.

What matters to you and me are the basics:

  • Extracurricular activities

If these three critical areas meet your approval, you are almost there. The other essential item on your checklist is whether the school or schools you investigate best fit your child.

The other items worth exploring are the following:

  • Is the school aligned with current market conditions?
  • Is it managing its financial affairs efficiently and legally?
  • Is there a strategic plan in place?

The last thing you want to do is get entangled with a private school that is dead in the water. The answers to the three questions above will better explain whether the not-for-profit or for-profit schools you evaluate are viable operations.

Is the school aligned with current market conditions? Communities' demographics change over time. Where once there was an ample supply of young families fueling demand for places, now the community is no longer affordable for young families. I have seen this happen many times over the years. One way of keeping the school viable is to market it effectively. Reaching outside the old boundaries to attract new families from other nearby communities will replenish the applicant pool.

Is it managing its financial affairs efficiently and legally? You would be surprised how often bad financial management will put a school on the ropes. Undoing all the good accomplished over many years only takes a few years. Spending more than you have in income and dipping into endowments are two common reasons some schools are on the brink of financial disaster.

Is there a strategic plan in place? A visionary board of trustees will be constantly looking ahead. It worries about such mundane but essential things as what market conditions will be like a year from now, three years from now, and so on. It frets over maintaining the school's physical plant. It dreams about increasing the school's endowments. And so on.

I mention these three critical questions simply because some not-for-profit schools don't understand how to market their schools or manage their fiscal affairs, which makes planning challenging. How will you know that these matters are an issue? Do your due diligence. Visit the schools. The answers will be in plain sight.

In conclusion, then the legal status of a school is not nearly as important as how it is managed.

Questions? Contact us on Facebook. @privateschoolreview

#PrivateSchools #ForProfitVsNonprofit #SchoolGovernance #EducationChoice #PrivateSchoolManagement

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VIDEO

  1. How Much Does It Cost to Start a Private School

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  6. Creating Your Identity & School Branding Strategy

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