Why do training institutions have good student sources but still go bankrupt
Time:2025-11-07
Source:Artstep
Amy saw the neighboring school building tall buildings and students coming and going. I saw the neighboring building collapse again, not making any money and going bankrupt.
Amy has also been facing business difficulties recently, afraid that others will watch her 'collapse'. Her school is not small in scale, with over 400 students. There are various types of courses, including art, dance, broadcasting and hosting, calligraphy, English, Olympiad mathematics, and taekwondo. There are many students attending classes back and forth, but they just don't make any money.
Like Amy School, there are many students and many non-profit schools. The common characteristics of these schools are that they are mainly small and medium-sized, with good student sources, a wide variety of courses, and a considerable number of teachers.
And if schools want to maximize profits, they need to identify the reasons and make changes.
1. Extremely high expenditure
Venue rent, utilities, and management fees.
Fixed expenses are high. Taking Amy's institution as an example, seven courses require at least four classrooms. Art and calligraphy can be used interchangeably in the classroom, while math and English can be used interchangeably in the classroom. But art and dance cannot be used in a universal classroom, and taekwondo and English cannot be used in a universal classroom. There are many subjects and a large number of classrooms, which require a large area for the venue. The venue has a large area, and the rent, utilities, and management fees are very high.
If Amy admits new students with three dance classes, two art classes, and two English classes, she will need to add classrooms, at least two more classrooms, and the fixed expenses will increase on the basis of the original ones.
Teacher has high salary expenses.
Dance classes have dance teachers, art classes have art teachers, and each subject requires at least one teacher. Amy's school requires at least 7 teachers, 7 teaching systems, and 7 salaries. If an art teacher takes a leave or resigns, and other teachers are unable to substitute, they have to spend money to find part-time or re hire full-time teachers. During the process, the new teacher has to spend time adapting. But in a professional art school, a maximum of three teachers are needed for seven classes, and teachers may take leave or resign to have colleagues substitute for them. Teachers in professional art schools earn 6000 yuan per month, while teachers in comprehensive schools earn 3000 yuan per month. I believe principals can tell at a glance whose expenses are higher.
Comprehensive expenses account for a high proportion.
When schools organize activities, dance schools only need dance related materials, while comprehensive schools need to prepare materials for each course. When giving gifts to students, art schools give brushes, paper, and paint, while comprehensive schools cannot always give stationery and toys. Gifts need to be changed on time. Dance classes give dance shoes and costumes, English classes give English picture books, and calligraphy classes give calligraphy posters. Only in this way can the school's brand memory be increased and achieve the same effect as professional schools.
From the expenditure, it can be seen that in order for these schools to change their current situation, they need to reduce their expenses, otherwise no amount of income can support the survival of the school!
2.Reduce expenses
Simplified Course
Many principals say that when the school opened, it only had one or two courses. And there are only so many children around, so the principal wants to make money and gather students. Gradually, other courses emerged to retain students, but in the long run, some courses could not be cut but could not be developed. If the principal wants the school to continue to make efforts in its future development, they need to simplify courses that have poor results and students who are dissatisfied with the class. Integrating courses can increase the utilization rate of classrooms and teachers.
This process needs to be gradual, with the ultimate goal of retaining the school's flagship courses while offering 1 to 2 unique courses based on the school's strengths. For schools, they may not make money in the early stages. But it can greatly reduce expenses. Only in the later stage of development can schools concentrate resources to enhance the professionalism of their courses and improve their brand building.
Simplify Teachers
Ensure teaching and research, and enhance the professionalism of teachers. Amy's school requires at least 7 teachers. During teaching and research, the art teacher cannot articulate the strengths and weaknesses of the English teacher's curriculum, and the dance teacher cannot articulate the strengths and weaknesses of the art teacher's curriculum. Teachers are unable to conduct course research and improve course effectiveness. But in a professional dance institution, all the teachers teach dance, and gathering 4-5 people together to polish the lesson is more conducive to teaching and research, which can spark different sparks, improve the quality of the course, and ensure the effectiveness of the course.
Extremely low income
Multiple subjects
There are no particularly outstanding courses, and it is necessary to use low prices to attract parents to enroll in more subjects. Even if parents enroll in more courses, the total price will not be too high. For example, the tuition fee for the first semester of the ballet major school next door is 8999, the tuition fee for the first semester of the dance program at Amy School is 2499, and even if parents apply for art and taekwondo, the tuition fee is 4998. The three courses combined are not as expensive as any other course.
Teacher's major is different, unable to concentrate on grinding lessons
Teaching and research are difficult to carry out, and the effectiveness of the curriculum cannot be improved. The course has poor effectiveness and can only attract students through a "price war". Low prices lead to low profits. Without funds to develop valuable courses, it is impossible to improve the quality of teaching, the effectiveness of the courses is not significant, and it is impossible to raise prices. We continue to attract parents with low-priced courses. Some schools have also compressed teachers' salaries, resulting in teachers being unwilling to grind classes or even resigning. If this continues, it will lead to a vicious cycle, with incomes getting lower and lower, and schools will eventually come to an end.
The occupancy rate of is too low.
For example, the child enrolled in dance, calligraphy, and art at school. She only has two students in calligraphy class. Will the principal not open classes because there are not enough students? unable! Calligraphy costs 2888 per semester, consisting of 16 classes. Full time teachers earn 3000 yuan per month, while part-time teachers earn 200 yuan per class, including rent, utilities, materials, and other expenses. After a semester, their income is particularly low, and they may even be unable to make ends meet.
There are tens of thousands of campuses that cooperate with Artstep, and most of the highly specialized and targeted schools have developed particularly well.
Comprehensive schools are only large in scale, with over 1000 students and good development. And most small and medium-sized comprehensive schools, like Amy's school, had high profits in the first few years, but as time passed, unusable and inefficient expenses increased, and income decreased. As more and more excellent professional schools emerge in the surrounding area and competitors increase, principals can only use cheap courses to attract parents. Slowly weakening in the fierce competition of the training industry.
Like running a business, running a training school requires dedicated personnel to handle job responsibilities, workflow, data management, and activity plans. And our Artstep is based on helping principals plan their work, grasp the dynamics and operational status of the school, and grasp the core of every detail of school operation, using data to assist school development.