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Tutoring Franchise & Business Opportunities

Tutoring Franchises and Programs Industry

General Tutoring Industry

The tutoring industry offers both test preparation and academic tutoring services to students. Most test preparation provided in this industry revolves around SAT and ACT prep, as they are the two dominant college entrance exams in the US. This industry is separate from academic institutions like high schools or colleges, and it also excludes online only operations and other institutions that offer training services in areas that are not primarily academic, such as driving, art, or technical skills. There are very few established tutoring franchises in this industry — the number one being Kumon — resulting in a low market share concentration. There are relatively few barriers to entry for the tutoring industry, and franchisors enjoy the benefit of inheriting a business that is already well-established and well-reputed.

Education Industry Trends

Companies in the education industry will continue to invest in digitizing their curriculum and teaching methods, as the business world comes to increasingly rely on virtual platforms to conduct their operations. The COVID-19 pandemic has only amplified the need for education to be made accessible online, and many institutions that were traditionally brick and mortar have been forced to transition to a virtual platform. Even before the pandemic, the advent of technology has been viewed as an opportunity to better facilitate student learning, and many businesses in the education industry have relied on digital tools to enrich their curriculum. A separate driving force for this trend of digitization in the education industry as a whole is the shift of the US from a manufacturing based economy to a service based economy, with more and more jobs requiring higher education. As a result, many working adults are looking to advance their education, but in a way that is flexible with their busy schedules. Institutions of the education industry that can provide this flexibility through a virtual platform have become increasingly valuable.

Key Education Industry Numbers

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Paid-in-Full Rate

The Paid-in-Full Rate is when the SBA loan is fully paid off by the small business owner including interest, indicating financial strength.

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Charged Off Rate

The Charged Off Rate is the SBA loan default rate where loans have no confidence in being paid off by the small business owner.

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SBA Loan Success Ratio

For every 10 SBA loans fully paid including interest, 1 SBA loan was unable to be paid back, or defaulted. 

*SBA Loan Data from 2010-2019

*Non-Franchise Businesses taken into account: 4,794

Tutoring Industry Trends:

Overall, improving economic conditions have led to the growth of the middle class, and with more families with disposable income, many are choosing to invest in their child’s education. This heightened demand for tutoring services is complemented by the fact that good economic conditions have led to low unemployment, so parents have less time to help their children study and instead have to hire outside help. Furthermore, shifting societal trends have increasingly placed value on a college education, and admission to a selective, elite institution has never been more sought after. Nevertheless, there are some factors that could potentially impede growth and revenue expansion in this industry, such as the shift to online-only services and improvements in public education. But ultimately, the overarching demands for the tutoring industry outweigh any negatives.

Average Education Franchise Industry Percentage Fees

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Standard Education Franchise Industry Investment

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This metric is the standard industry investment amount for a single unit franchise investment in this industry. Our research and analytics team analyzed over 47 franchise concept investment breakdowns in order to calculate this figure.

SBA Franchise Loan Data

0 %
Paid-in-Full Rate

The Paid-in-Full Rate is when the SBA loan is fully paid off by the franchisee including interest, indicating financial strength.

0 %
Charged Off Rate

The Charged Off Rate is the SBA loan default rate where loans have no confidence in being paid off by the franchisee.

0 :1
SBA Loan Success Ratio

For every 5 SBA franchise loans fully paid including interest, 1 SBA loan was unable to be paid back, or defaulted. 

*SBA Franchise Loan Data from 2010-2019

*Franchise Businesses taken into account: 955

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Learn more about the Education Programs Industry

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