Learn the simple methods to reduce spending. They will help improve the profitability of your school by as much as several dozen per cent annually. Constant verification of the incurred expenditure and search for savings are central for a success of each business undertaking. Here are a few hints on what it is worthwhile starting from.
1. Think about outsourcing
IT services, accounting or maintenance of the school infrastructure can be outsourced to external entities. Instead of hiring and accountant or an IT specialist, it is worthwhile taking advantage of assistance of companies being experts in a given field. Owing to such solution, you can save a lot and also have access to a broader scope of services (an external company hires more specialists).
2. Reach out for leasing
Instead of buying audio equipment, computers, flipcharts and multimedia projectors for your school you can lease all such assets. This will help avoid freezing your capital. Additionally, owing to uniform distribution of costs over time, leasing enables optimisation of tax burdens.
3. Establish a limited liability company
When launching their business, most owners of language schools do not take into account the option to operate as a limited liability company. But in many cases this can be much more beneficial than operating under sole proprietorship formula. It is true that establishment of a limited liability company is quite complex, time-consuming and costly. In a longer time perspective, though, it can be profitable, among others owing to better opportunities for fiscal optimisation, plus savings on social insurance contributions.
4. Control the spending on advertising
Expenditure on advertising is sometimes compared to firing the stove that will take any volume of “fuel”. Even if this brings some short-term effects, in the long run it may turn out that the fire so made dies down and requires further spending.
Therefore you should constantly monitor the effectiveness of the performed marketing actions. Data concerning advertising in the Internet are most easily available – most e-marketing solutions offer precise statistics. It is more difficult to measure the effects of other promotional actions. They can be checked, among others, by performing a survey among course participants, asking them how they learnt about your school.
5. Cut administrative costs
The secretariat is the core place for efficient functioning of the school. Course instructors must have good conditions for work, and the customers must feel they are well attended. Therefore cutting spending on administration should be approached cautiously.
Nevertheless, you can also looking for savings in the secretariat. First of all you should answer the question how big its staffing should really be. Is it necessary to hire three secretaries, or perhaps two persons will do? In this respect you can be assisted by such tools improving school management like LangLion platform.
6. Let the premises be self-sustaining
Usually the rental of the premises is one of the greatest costs of running a school. It is worthwhile checking what the situation in the office space rental market looks like – if the prices have dropped, let’s renegotiate our contract. Remembers also that in the hours when school does not operate, you can let classrooms to other companies, because each hour when classrooms are empty is a lost hour. Make sure the contract you sign with the premises’ owner does not prohibit to you letting the classrooms to other entities.
Another solutions is resigning from use of a part of the premises in favour of providing online courses. Transfer of the costs of rental of unutilised space onto an online teaching tool can be very profitable. Your will spend less, and can additionally create and opportunity to enter a new customer market.
7. Take care of small savings
Analysing the spending on current office operations can also bring many benefits. Choice of copiers adjusted to specifics of work in your school, use of scratchpads, control of electricity consumption, rationalised premises’ heating, choice of good markers to write on flipcharts – each of those elements may bring about savings of several dozen zloty monthly, adding up to hundreds zloty annually.
How do you reduce the costs of operations of your language school?