How to start a tutoring business
Learn how to become a tutor with our guide to setting up a tutoring business
Key things to consider when starting a tutoring business are:
Whether you’re planning on setting up a business on your own, as a single tutor, or whether you are hoping to establish a tutoring agency where you’ll employ and manage other tutors, the same principles apply. From legal regulations, to planning, preparation, marketing and pricing, this guide offers advice for anyone looking to enter the tutoring world.
Everyone has the right to a good education. Governments past and present have made learning in schools a top priority, however there are still many young people who don’t receive a satisfactory standard of teaching. There are also countless children that fall behind in class and struggle to keep up with their contemporaries. An increasing disenchantment with the English education system has resulted in greater demand for extra tuition, both outside of school hours when at home, and during the day as organised by the school.
September is ‘back to school’ month and is traditionally one of the busiest months for tuition. As demand has grown, individual tutors have begun to set up their own businesses. With relatively low start-up costs and no formal training obligatory, tutoring has become an easy way for people to make some extra cash. However, the perception that you can set up a tutoring business easily needs to be corrected, explains Will Orr-Ewing, who founded Keystone Tutors. “Just because the start-up costs are low and it’s light on regulation, doesn’t mean it shouldn’t be professional,” he explains.
Who is tutoring suited to?
To set up a tutoring company, you don’t need to be a fully qualified teacher. Although many professional teachers do tutor in their spare time or in the school holidays, the tutoring business is not reserved for them alone. Furthermore, you don’t need to have a PhD in your chosen subject to be able to teach it, because the quality of teaching is not directly related to the level of education. Of course, it goes without saying that a good understanding of your chosen subject is a must, therefore high qualifications are desirable. A thorough understanding of the education system and the curriculum are also essential attributes for a good tutor.
It may be worth considering seeing if you can get a Business Loan to help you with financing your startup idea.
Enthusiasm and a positive attitude are key characteristics for someone starting a tutoring business. Students will come to you for extra help and may have very low confidence in the subject, so an enthusiastic and encouraging tutor will do wonders to boost their self-esteem. Will Orr-Ewing emphasises the importance of being passionate about both the subject you’re teaching and for the business you’re building. As with starting any business, if there is no enthusiasm or drive, the chances of success are slim.
It will pay dividends if you’re well organised and good at time-management. Planning and preparation will play a pivotal role in the day-to-day running of the business, so someone with the ability to prepare and stick to a structured plan will be more likely to succeed.
Creating a tutoring business plan
One of the first things you need to decide before starting up is what subjects you’re going to tutor yourself. This is usually your degree subject, or A-level choices, depending on the age and level of students. Obviously, the higher your qualification you have, the higher the level you will be able to teach, which will provide you with a wider range of students. It’s worth looking at the competition in your local area to see what subjects are not covered, because this could give you an advantage over other tutors. If there are already 20 maths tutors in your neighbourhood, it will be much harder to make your mark.
That being said, certain tutoring topics are more popular than others – the demand for French tutors will generally outstrip the need for Russian tutors in any area, for example. Popular tutoring topics include:
- General Science
Next you need to decide on location. Will you conduct sessions from your home, or will you go to your students’ houses? Parents with young children may prefer the tuition to take place under their roof, particularly if they don’t know the tutor, so that the child can feel safe and comfortable in a familiar environment.
However, you need to bear in mind the cost and time it will take for you to get to and from your lessons. If you don’t have access to a car or reliable public transport, this could be difficult. Some tutors only conduct lessons from their own homes, which can have many advantages; it will save money, time and energy, and can allow them to book more sessions into their day. But you may be limiting your clients to parents who have the time and means to deliver their children to and from a tutor.
To run an efficient and reputable business, you should have the right materials from the start. Get hold of the curriculum for your chosen subjects, along with any relevant exam papers, which can be ordered directly from the individual exam boards. Other materials such as paper and pens, calculators and text books will be necessary, so thorough preparation before each session is crucial. Look out for adverts in the local paper for pupils selling their textbooks – this can be cheaper than buying first hand although getting your hands on the most up-to-date versions is important.
On the topic of preparation, careful planning for each session will help enormously, particularly when first starting out. Having a detailed plan laid out will build your confidence, and as you get more students, it will prove invaluable to help you distinguish between each session. It may sound menial, but keeping track of all your lessons in a journal can have huge benefits by providing a clear view of your schedule.
You will probably have a computer and printer already, but reliable IT equipment is necessary to keep on top of correspondence and bookings – and for organisation. Once business is flourishing, expansion might be on your agenda, which will be greatly facilitated by a company website, business cards, letter heads, and so on. These will add to the professional appearance of your business, and will help establish it as a reputable and reliable service.
To help formulate your tutoring business plan you may find it useful to download our free business plan template.
Tutoring business rules and regulations
The tutoring business is fairly free from strict regulation. There are no specific qualifications or certificates that tutors are legally required to obtain, making it reasonably easy for people to set up businesses. That said, any reputable establishment will ensure it is registered with the DBSDisclosure and Barring Service (DBS) and that each individual tutor is DBS checked. The DBS check replaced the old CRB and ISA check systems, and the procedure is very similar. If you’ve had a CRB check done before, it is still ‘valid’ under the new system.
A standard DBS test per individual costs £26, which includes checking the police national computer, while an enhanced check costs £44. This includes a police national computer check, as well as checking the list of people barred from working with vulnerable adults or young people, and it also goes to the local police force for a more in depth check. There is no expiry date on the individual DBS registration, but it is up to each organisation or agency to decide how often they renew their DBS checks. Despite not being obligatory, it is highly recommended that anyone starting a tutoring business registers with the Disclosure and Barring Service – many parents will not be willing to hire a tutor for their child, without seeing the certificate.
While a DBS check is not, at present, legally required, it’s worth visiting the government page on the Disclosure and Barring Service on a regular basis. Any changes to the system which may occur will be detailed on this page. When you apply for a DBS check, it is also worth signing up to the DBS Update Service, which will send you an email if any changes to the law occur.
Aside from the DBS check, you might decide to set out ground rules for accepting and declining tutor applications. For example, if you receive an application from a maths tutor, it would help if you have already decided what your minimum qualification requirements are for maths tutors. Depending on the level of the student, you might decide that they must be at least one or two qualifications higher, in order to provide a good-quality service.
When operating as a business you’ll also need to make sure that you’re properly insured, even if you’re based at home. Explore the insurance you might need as a home-based business here.
Starting a tutoring business: Reputation and marketing
Like many businesses, a tutoring company relies heavily on reputation for its long-term success. Word-of-mouth recommendations account for a high proportion of promotional methods, and it goes without saying that a parent will seek out the opinion of a friend on the reliability and quality of a potential tutor for their child. It only takes one bad comment from a client for a tutor’s reputation to be tarnished, which could consequently take years to repair. Will Orr-Ewing from Keystone Tutors suggests turning down clients if you don’t think you can help them to the best of your ability. If you’re stretching your time and resources just to fill a booking, this will be reflected in the quality of service the client receives; an unsatisfactory client will be more damaging to your business than if you had turned down the booking in the first place.
To boost your trustworthiness, ask for references from previous clients. A few good testimonials will do wonders for your reputation. Another cost-free mode of promotion is to post notices and business cards on boards at your local schools, shops and libraries. A letter to the local education authority in your area may also be worthwhile as they could refer you to parents needing a tutor for their child.
Once your business is established and you have a number of tutors on your books, it would be hugely beneficial to invest in a company website. Getting yourself near the top of Google search will generate a lot of traffic to your site, and hopefully some new clients, however make sure the site looks authentic and reliable. Using certain keywords on your site can help improve your Google ranking, so it might be worth focussing on the fact that you’re a tutoring business in a certain geographical area, rather than saying you’re a maths tutor, for example. The more specific the terminology, the more relevant to the search you’ll be. If you can’t afford to hire a good web-designer to create your own web-site, there are a number of internet directories for tutoring businesses that you can join, although be sure to check out the site properly before signing up. Look for logos of established organisations on the home page of these registers, such as the Department of Education, OFSTED, the National Centre for Social Research (NatCen), or the Times Educational Supplement, because they will only endorse reputable directories.
Placing an advertisement in the classified section of your local paper can be another good way to promote your tutoring business. It may be worth experimenting with different papers and supplements in your area – by asking enquirers where they heard about your company, you should be able to gauge how successful each ad is in generating new customers.
Expansion plans: Should I start a tutoring agency?
If you’ve been working as a tutor and have become too busy to take on more clients, you may be in an ideal position to start a tutoring agency. As an extension of a one-person tutoring business, you will need to have a number of tutors on your books. This will enable you to take on much more work and build up a reputation and client base in less time.
When starting a tutoring agency, the key challenge you will face as opposed to starting a one-person tutoring business will be recruiting the tutors themselves. In this industry, your reputation is everything, and you will find the process of recruitment much easier if you are already well-known as a good tutor. Therefore, before starting an agency, it is a good idea to spend some time working as a tutor yourself and building up this reputation. “The difficulty of finding tutors depends on the strength of your brand within the market,” explains Woody Webster, co-founder of tutoring software firm TutorCruncher.
When it comes to finding tutors for your agency, you have a number of options – whichever method you choose, it is likely you will be spending most of your time, money and effort on recruitment in the early stages. “New agencies need to invest in recruitment – this can be done with flyers at local universities, online advertising such as Google Adwords, or other forms of online marketing,” says Webster. “It is well known that referrals are the strongest form of recruitment, which only comes with time operating and proving yourself. It can be difficult at first but it gets easier with time as your brand grows.”
“Good tutors often generate other good tutors,” adds Kate Shand, founder of leading London tutoring agency Enjoy Education. “Our tutors respect the fact that our brand stands for quality and commitment; they know the same is expected of them at all times, and that they will be appreciated for their efforts.”
A key part of the recruitment process will be vetting the tutors on your books. A poor tutor can destroy your small agency’s reputation in one fell swoop, so it is vitally important you ensure all your tutors are of the standard you want your agency to be known for. Interview all prospective tutors as a minimum level of quality control, and insist on minimum levels of academic qualification before interview to ensure you aren’t flooded with a deluge of unsuitable applications. “Our tutors need to show real passion and enthusiasm for the subject they are teaching,” says Kate Shand. “They have to demonstrate impressive teaching skills as well as survive a lengthy interview.”
You should also DBS check all your tutors in much the same way as you would when starting a private tutoring business. Being able to reassure parents that all your tutors are thoroughly background-checked is well worth the small expense a criminal records check entails.
In terms of financials, assuming you won’t be operating on a franchise model, how much you can earn depends largely on the number of tutors you have on your books. “You can expect to get around £1,000 of commission per client per year as a standalone agency,” estimates Woody Webster. You should only pay VAT on the commission you charge to your tutors, rather than on the entire fee they charge to students.
Whilst more tutors means more earning potential, every new tutor your agency takes on will entail a greater administrative burden, so you won’t have unlimited earning capacity. “The time spent on administration is often disproportionate to the time spent selling,” explains Woody Webster. “It is important to get systems in place to overcome these time stealing activities that add no value to your business.”
Depending on your area, you may have to compete with other, more established agencies – who may have already snapped up much of the local tutoring talent – so it is worth targeting a particular niche in the market. “Literacy and numeracy, particularly aimed towards preparation for entrance exams, will remain the most popular subjects,” Kate Shand explains. “However, there is a growing need for providers focusing on niche areas such as GMAT preparation. Subjects relevant for the 21st century job market are also worth looking at. 2014 is the UK’s Year of Code, and employers will look favourably upon graduates with IT skills such as setting up websites and computer programming.”
Tutoring costs and potential earnings
Working out how much to charge for your sessions needn’t be complicated. Try calling other tutoring agencies in your area and ask how much they charge for lessons, and then set your price somewhere in the middle. Don’t try and be too greedy early on because people are unlikely to hire you if you’re more expensive yet unknown in the area. That said, don’t price yourself too low because it may spell out poor quality to potential clients. As you develop a positive reputation among your students and their families, you can start to charge higher rates for new students. Increasing your fees at the beginning of each school year is also acceptable, but be sure to raise your rates gradually.
One way to earn more money per hour is to double up your students. If you have two students who need tuition in the same subject area and are of a similar standard, you could tutor them at the same time, offering them a discounted rate. If each client usually pays £20 per hour, you could charge them £15 each, which would give you a £10 increase, and yet would save them £5 each.
It is essential that you keep track of your income and expenditure. Buy yourself a receipt book and provide your clients with a receipt for each payment. If numbers are not your forte, it might be worth investing in some accountancy software to make the task easier.
As with any company, save all your receipts from business-related purchases and take time to organise them properly. You will be able to claim expenses for tax relief purposes on things like telephone, internet and electricity bills, as well as travel expenses, office supplies and advertising. Contact HM Revenue and Customs to find out more about allowable expenses and the process involved.
Tutoring business useful contacts
HM Revenue & Customs http://www.hmrc.gov.uk
The Tutors Association http://thetutorsassociation.org.uk/ 01628 890130
First Tutors https://www.firsttutors.com/