Business plan of pole vaulters school

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The business plan for a school of Pole Vaulters presents a business model where volumes are essential for sustainability of the school. The school will offer popular education by taking franchise of an existing brand such as Beaconhouse Educators, Punjab Group and Air University. It will target at Pole Vaulter segment, which constitute of parents who are fairly comfortable financially, though they cannot afford an opulent spending on education facilities.

At a fee of Rs. 3000/- to Rs. 4000/- per child per month, the school will break even in the first year of operations. In this business plan we have two service scenarios with their benefits and risk profiles.

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Business plan of pole vaulters school

  1. 1. Business plan for a primary school Authors: Babar Malik and Farooque MalikSchool – Business Plan (Pole vaulter segment)This is a business plan for a school consisting of 8 classes, i.e. 3 pre-school classes, and 5 classes fromclass 1 to class 5.The school will serve the higher-middle income segment. Some leading school networks of the countryare very cognizant of the gap between the demand of better education and supply thereof. They are inthe fast process of filling this gap through franchises. Beaconhouse has been successful in the franchise.Punjab Group of Colleges has also recently ventured into this expansion by the name of Allied Schools.The Air University is also in the same process. These franchises cater to the segment that we havenamed as “Pole Vaulters”.Franchisors offer an operational package of their schools to the franchisees. They cover all the teachingplans and methodologies. They also provide parameters for teacher selection. Beaconhouse providesservices of the Principal for 1 year.The franchise fee ranges from Rs. 700,000 to Rs. 1,000,000. They offer assortments, i.e. Preschool tomiddle, and Complete Comprehensive (Preschool to metric / O Levels)NEEDS & EXPECTATIONS OF THE TARGETED SEGMENT:The Pole vaulters:This segment consists of families where both parents, or one of them, are educated and also cognizantof the value of excellent education. Income levels of this segment are fairly comfortable, though theycannot afford an opulent spending on educational facilities. This segment is also demanding of the skillsand efforts of the faculty, along with the environment of the institution. Education of their children isalso a statement of their social status. They are brand loyal if the educational institution meets theirexpectations. They get their children enrolled by word of mouth, friends and family referrals, and peerrecommendations. Academic accomplishments are more relevant to them in comparison with extra-curricular facilitating activities. It is of core importance to this group that their children secure highgrades to get admissions in good colleges. They usually send their children to tuition academies so as toupgrade their ability to obtain competitive grades at exams. This is an area which the schools lack atdelivering.These people reside in good neighborhoods, (for example areas Model Town, Cantonment, Gulberg,Defense, Faisal Town, Township, Samanabad, Shadman etc in Lahore). Nonetheless they can afford tospend Rs. 5,000/- to Rs. 10,000/- per month per child for its pre-school and primary education.The needs of the segment are as below; Academic accomplishments of their children. 1
  2. 2. Business plan for a primary school Authors: Babar Malik and Farooque Malik Education that creates awareness of possibilities and opportunities in professional fields for their children and prepares them to compete and avail those opportunities Proficiency in the application of English language in their education and social life. Develop a positive personality of their children within the societal norms of decency A reinforcement of their social status.Schools serving this segment:Names and fees of the schools in this segment are as follows:Lahore Grammar School 9000/-Beacon house schools system 6000/-Educators 3200/-City School 6000/-Crescent School 4000/-Lahore Lyceum 5000/-Convent Schools 4000/-Lahore Pre-School 4000/-Salamat Academy 5000/-Roots 4000/-TARGET MARKET:Our target market is the pole vaulters segment in Lahore, Islamabad or Sargodha. An exact location willbe finalized based on the suitability and customer potential.POSITIONING:The possible position is that of an educational institution that prepare students for competitivesecondary and higher education.CRITICAL SUCCESS FACTORSCSF 1: Proactive relationship with the Franchisor so as to gain maximum advantage of the franchisors’positioning and expertise.CSF 2: Recruit and retain teachers who have a good reputation in the market and can enable thestudents to get high grades.CSF 3: Management and teachers have an interactive networking with parents so as the parents canhave a clear understanding of the efforts of the school and facultyCSF 4: Devise strategies and score card to be able to efficiently operate and manage the school 2
  3. 3. Business plan for a primary school Authors: Babar Malik and Farooque MalikSCENERIO ANALYSISWe have examined two scenarios, where in first scenario classes will be offered up till grade 5 and in thesecond scenario they will be offered up till grade 8. On the basis of financial analysis of the twoscenarios it was decided to pursue the second one, as it is more feasible option among the two. In thefirst scenario with classes up to grade 5 we continued making a loss into year 4 of the business, while inthe second scenario with classes up to grade 8, the business became profitable starting year 2.INFRASTRUCTURE PLAN  A two kanal area is required  Infrastructure will consist of a small play area, 11 classrooms, one library, one science lab, one computer lab and administration block  Classrooms will be airy, well ventilated and well lighted.  An administration block will constitute of office for Principal, teacher’s common room and administration offices  Toilets will be constructed at multiple locationsSTAFFING PLANFollowing is the staffing plan for our school: Staffing Plan Designation Number Monthly salary Annual Salary Salary/person Principal 1 40,000 480,000 40,000 Teacher 14 196,000 2,352,000 14,000 Coordinator 1 12,000 144,000 12,000 Receptionist 1 6,000 72,000 6,000 Security Guard 2 12,000 144,000 6,000 Ayaa 2 24,000 288,000 12,000 Janitor 3 36,000 432,000 12,000 Office peon 1 5,000 60,000 5,000 Total 331,000 3,972,000A physical training teacher is also included in the teaching staff 3
  4. 4. Business plan for a primary school Authors: Babar Malik and Farooque MalikMARKETING PLAN:1. Product and Service:  Offer standardized and result oriented education services to students  Franchisor’s provided curriculum, systems and methodologies  Prep , primary and middle school education2. Price  Follow the Franchisor’s free structure  Competitive monthly fee ranging between Rs. 3,000 to Rs. 4,000 per student3. Promotion:  As developed and designed by the Franchisor  Advertise on local cable TV, flyers etc.  Promotions at the bookshops in the vicinity  Visible promotional boards on and around the campus4. Placement:  Identifiable and approachable by the target market  In a neighborhood where the target population lives5. People:  Reputed teachers who have a track record of delivering exam results  Teaching staff to have a presentable and friendly interpersonal skills to teach  Administrative staff should be able to manage security and facilities properly6. Process:  Follow franchisors procedures for all staff, as per their assigned scope of work  Training of staff on the SOPs  Ethical codes  Hygiene codes  Update training to staff on a regular basis  Rewarding based on clearly stated performance measures 4
  5. 5. Business plan for a primary school Authors: Babar Malik and Farooque Malik7. Physical evidence:  Franchise reflected  Consistency of place and service  Safe environment  Nice looking uniforms for children  Neat school with organized and nice looking classroomsBREAKEVEN ANALYSISScenario one: Pre and primary school  Our school will break even at 1,236 fee cycles (103 students). This number is based on assumptions that average fee per student is Rs. 3,384/-  Based on our sales forecast of 1,248 fee cycles in the first year, the breakeven will be achieved in the same year. This calculation does not include the effect of one time franchise fee of Rs. 700,000/- and marketing expenses of Rs. 200,000/-.  If these two expenses are also included then it will take more than four years to achieve profitability.Scenario two: Pre, primary and middle school  Our school will break even at 1,641 fee cycles (137 students). This number is based on assumptions that fee per student is Rs. 3,579/-  Based on our sales forecast of 1,824 fee cycles in the first year, the breakeven will be achieved in the same year. This calculation does not include the effect of one time franchise fee of Rs. 700,000/- and marketing expenses of Rs. 200,000/-  If these two expenses are also included then profitability will be achieved in the second year of operations.FINANCIAL ASSUMPTIONS:1. Revenues assumptions  Fees shall be @ Rs. 3000/- Per month for preschool, Rs. 3500/- for primary school and Rs. 4000/- for middle school.2. Cost of services sold assumptions  Cost of services i.e. teachers salaries, administrative and custodial staff will increase at 10% per annum. 5
  6. 6. Business plan for a primary school Authors: Babar Malik and Farooque Malik3. General administration expenses  Rent will be paid at Rs. 160,000 per month. The rent will increase at 10% per annum  Depreciation is calculated at 10% per annum on the book value of assets, using the diminishing balance method. 6

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