In a highly competitive world the focus on education is seen as increasingly important to parents who are looking to extend children’s learning beyond school hours. We looked at two franchise systems, Begin Bright and Listen to Read, in part one and here we find out about two very different models: one play based, one centred on worksheets.
Bricks 4 Kidz
The 13 years Steve Bealing and his wife spent in Singapore taught the pair how highly education is regarded there. “The emphasis in Asia on education is enormous but Australia is increasingly aware of enriching above and beyond the classroom,” he says. “It’s a very nascent stage in this industry.”
And this awareness is not just about pre-school learning but Bealing believes parents see an opportunity to extend their child’s skills throughout the whole schooling period. “We see now how tutoring franchises are growing, parents like to give their children an edge. At Bricks 4 Kidz we use Lego to engage kids and teach them about machines, animals and how the world works. We haven’t found any other business in Australia concentrating on play. But we’re very aware always, and scanning the market to see what else is around.”
Bealing cites museums and major cultural sites such as the Sydney Opera House as occasional venues for fun educational programs, and also mentions how shopping centres are using free play Lego areas to encourage families to stay and shop. “But these don’t offer a specific program structure,” he says.
The brand originates from the US where it started in 2008; it is now across 35 countries, with regular research and development conducted in Florida for its proprietary models. In Australia the business is in New South Wales, Victoria, Perth and the Sunshine Coast.
Bricks 4 Kidz offers programs for after-school, pre-school and school incursions as well as birthday parties, but it is the holiday program of half a day, a single day, or two days that provides the majority of the activity for the franchise chain, accounting for up to 60 percent of business.
“Parents are looking to stop the brain drain in the holidays. We get the kids building things in our workshops.”
Science, space and popular games like Minecraft are the themes for the building programs, and robotics is one of the new courses to launch next year.
Kumon
Taking an entirely different approach to learning is one of the biggest names in tutoring. Kumon is now a global phenomenon and is an example of how the demand for childhood learning has increased with parents doing their research to find out what the different programs offer. “Providers must be relevant and be able to deliver on what they promise or parents will simply go elsewhere,” says Jessica Varralla, Kumon spokesperson, Kumon Australia and New Zealand.
For such study centre-based franchises, maintaining a relevant and unique selling position in the market place, especially with the proliferation of online programmes delivering more price-competitive offerings, is a challenge.
“Parents are also looking for a program that can respond to their child’s unique learning ability. While we have always catered to children in need of remedial assistance, many children are now coming to Kumon with a keen interest in maths or English and are looking to extend themselves beyond the work they are doing at school. This is another challenge learning providers must meet.”
There’s no doubt the market is highly competitive, and the customer base is diverse. “More Anglo-Australian families are seeking out supplementary programs to help their children be confident in the classroom and have a positive academic experience. Immigration from China, Southeast, and South Asia will continue to grow and this will boost demand. More programs are likely to become available to meet this demand.
While the childhood learning marketplace will become increasingly competitive, people trust in long-established and proven methods of learning, says Varalla.
“This year we reached our highest-ever number of students with 45,000 learning with us. We can see trends where students are coming to Kumon at a younger age, particularly to enrol in the Kumon English Programme, which develops reading comprehension ability.”
The franchise has almost one fifth of preschool students enrolled in its English program and is predicting a similar turn out for maths.
Word of mouth and reputation does much to build the business, but this is boosted with free trial campaigns through the year. The increased demand means the brand is expanding into new suburbs. Varalla says, “We now have 275 centres across Australia (centres in every state and territory) and in New Zealand where we are also expanding our operations. Our strategy is simply to put the best person in the best location. We will continue to open up education centres in a combination of commercial premises and in non-commercial locations, such as busy, central community centres.”
Demand for learning
IbisWorld observes that demand for tutoring services has surged over the past five years thanks to highly competitive tertiary education; parents want to give their children a head start. The Art and Non-Vocational Education in Australia 2014 report reads: “This trend is expected to continue over the next five years as discretionary income increases. IBISWorld forecasts that industry revenue will increase at an annualised two percent over the five years through 2019-20, to $5.9 billion.”
Caroline Finch, IBISWorld senior industry analyst says “Individuals or small establishments often run tutoring services. Tutors typically work part-time and are often higher education students themselves, or teachers who are temporarily out of work or retired. This segment is self-regulating, as there is no system of accountability or registration for tutors. Ongoing demand for an individual depends entirely on the tutor’s skills, rapport with students and student results.
“Tutoring is usually arranged on a private, one-to-one basis, although more formal establishments have emerged. Larger operators, such as National Education Advancement Programs, offer group review sessions for year 12 students prior to exams.
“Over the past five years, this segment has grown to represent an estimated 18.2 percent of industry revenue, due to strong demand for tutoring services. An increasingly competitive school environment has resulted in many students undertaking tuition in order to boost subject scores. There has also been growth in the franchising of tutoring businesses and online tutoring services.”
It’s an industry that is dependent on disposable income and at the same time cost conscious but, the report authors write, “The majority of tutoring businesses in Australia endured the global financial crisis fairly well. This is because parents who enrol their children in tutoring tend to view it as a necessity rather than a discretionary item.”