Buying A Tutoring Franchise

tutoring franchise

Buying a tutoring franchise can be a big mistake for some.  One of my friends made that mistake and bought a tutoring franchise thinking that they can earn top dollar quickly.  Firstly, this depends on the type of tutoring franchise.  Is it a location based franchise or are you buying a franchise with a territory.  If it is a location based tutoring franchise than you may have better luck. All you have to do is  choose a good location and buy the franchise.  This would be a good buy if the location is ideal.

The problem my friend made was buying an In-home tutoring franchise.   This involved buying a specific sub-city or municipality location such at Toronto- Richmond Hill region.  The problem in paying 25 to 50 K for a small region like that is that you are most likely going to get into turf wars with other franchisees.  That is exactly what happened to my college.  He purchased a region realizing that he had to spend over 15K in advertising for his specific region just to make 30K.  Not only that, he realized that the other franchisees wanted to cross turfs just to make a few extra coins by advertising on classified ads in the turf they were not assigned to.  So what did he do he took a 75K loss and decided to go back to the workforce.

So if you are planning on purchasing a tutoring franchise make sure you have purchased a good and vast location.  a subdivision for 25K is not going to cut it and you are probably going to have to cut your losses and run.  My Collegue mentioned it would have been more worth it if his boundry was larger and more vast.  For example if he had Markham, Thornhill, and Richmondhill,  it may have been worthwhile.  Other than than he felt that the franchise owners were conducting a pyramid scheme of owing a tutoring franchise.  They sell small chunks and make a quick 25 to 50 K while you are left with advertising between 15 to 40 k for such a small region that they give you. This is really difficult since 2007 the amount of tutoring agencies to compete with has grown substantially.

Author:

Penalope Sanchez is the Marketing Manager for Tutors 4 Less.  In the future they will be expanding to Ottawa, Vancouver, or Calgary.


Comments

Buying A Tutoring Franchise — 8 Comments

  1. I agree with Penelope. I did look into some home tutoring franchises. If you are buying a home tutoring franchise you are really fighting for territory with the other franchisees. This leads to crossing of territory and who is going to care. The tutoring owner just took your 50K gladly and will do nothing about it. The only thing they could do is give them a warning. If they persist they usually keep warning the franchisee but nothing really happens to franchisees that bend the territory rules. That is why I am considering purchasing a Kumon Math and Reading centre, Slyvan Learning centre, or an Oxford Learning centre. They are more costly but territory wars won’t occur if you have a fixed location in a mall or business location.

  2. Buying a franchise can become a memorable experience in life likewise your friend had in the past. Being a businessman one must have patience in their work like there is no such profession which can yield thousands of dollars to you after a few days of its foundation. Therefore patience is a key stroke in every profession especially in education and home tutor service.

  3. I agree partially with Tutor Bright. There are also Businesswomen out there too Tutor Bright! Anything you start up takes a lot of time and effort to get some results. Any business you start is like that. It takes a lot of learning when it comes to opening up a business or a franchise. I also agree with Penelope. When purchasing a franchise you really have to think about territory. If you don’t have the right territory than all that hard work you do may result in little success. And to add to that who is to say in a home bases tutoring business that your franchisee may advertise in your territory and take some extra clients. For example If you put your flyers in a Scarborough Skating arena but your territory is North York , who is going to police that Franchisee from North York. The franchisee can legally say I advertised there because people in north York visit that arena etc. That is why I am considering a franchise that has a location. I might not be picking a tutoring franchise because buying an established company like Oxford Sylvan, is personally costly for me with a start up capital of over 100K. I was at the CFA show last week and got some good ideas for under 20K. I am going to choose a franchise I would enjoy owning. Good luck to everyone. Choose your franchise wisely.

  4. Never invest in tutoring company franchises. Most are just a bunch of sales guys with nothing unique to offer.

    Two important questions to ask..

    1. Meet entire management and operations team , check educational qualifications and experience in and with education. You will be surprised.

    2. Get a buyout clause from franchisor . The option to return it back in 1 year at 100% of sales.

    They are in the business of selling you a franchise not buying one don’t let anyone tell you otherwise.

    • I totally agree with you Mustafa. Buying a franchise must include a buyout clause. I can’t believe people are buying into home tutoring franchise with a tiny geographic areas. They want you to spend thousands in advertising costs at your expense for a poor geographical area. Not a wise investment.

  5. You are so correct Mustafa. Some scammers start franchising not because they are successful at their business but because your hard work would bring them more cash. So Buyer beware. Before opening a tutoring franchise do your homework. How long has the business been in existence? Let them show you their business bank account to prove that they are making money. Anyone can say they are making money but just how much is what you are after. So if they do not show you their business account and activities to prove they are making money than get the hell out of the sales office and leave. Because if they are proven they would show you the money they have made.

  6. Totally agree with you Mustafa,

    We bought and ran for over 2 years a home tutoring franchise. The façade of a downtown office etc was made to ensure a huge corporation. Once the dust settled it was a company made of 3 people.
    Bunch of smooth-talking sales guys with no education/coaching/mentoring background.

    The work is tedious, you do everything. And if you really want to see the transformation in the once happy, fun franchisor… ask them to buy it back. They become monstrously notorious with legal talks, not returned phone calls etc.

    Word of advise: stay away from the tutor doctors/brights/clubz’s etc.

    They are in the business of selling you the business and getting you to do all the work and then pay a portion of the revenue(not profit) to them for maintaining a pretty website.

    If you are really passionate about helping kids, get started yourself. I was surprised to see how quickly you can build up a roster of clients with honesty and sincerity to help the kids.

    • I owned a home tutoring franchise for over 3 years. Gave up hope in my third year. The expect you not to give refunds to your customers. I had a client once purchase 40 hours and felt bad for the client so I refunded them 35 hours. I did not see my money back into my account for refunding them until 6 months later. They do this so you do not refund any clients.

Leave a Reply

Your email address will not be published. Required fields are marked *

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong>