Market Research & Feasibility Study: 10 Steps To Open A School Series

Market Research & Feasibility Study

A Market Research & Feasibility Study, including a financial model and business plan, is one of the first and most essential steps in setting up a new school. Making assumptions can be expensive, and decisions that don’t match the research could be made. They can be made on a hunch or a wild dream; therefore, a comprehensive study will minimise risk and also maximise your chances of success. Even if it is already clear that the school will advance, this research will influence many decisions in the set-up process.

Our studies range from “back-of-the-envelope” estimates to comprehensive reports of 200-250 pages used by private equity and investment groups. Whatever your needs might be, it is important to research and plan carefully.

We will look into Competitive Analysis in a little more detail below, but the following represents some, certainly not all, of what needs to be in a Market Research & Feasibility Study:

Vision and Mission – “The Voice”

It might seem like this is just a generic message on a feature wall that the marketing department came up with in a meeting, but actually, these statements are invaluable and are a priority in the Market Research & Feasibility Study. At GSE, we describe this step as finding the school’s unique “voice”. The voice needs to be clear, and all decisions made in the school, such as design, curriculum and choice of staff, reflect this unique plan. Imagine looking 20 years into the future when graduates return and share stories of the great times.

How will they describe the school? What was unique? Why is it different to another school?

The Market

Understanding the market where you plan to launch a new school is very important. People commonly make assumptions based on their own opinions of what parents value and what they want to happen rather than a plan supported by clear evidence. GSE analyse market demands based on 3 tiers or segments. We analyse the greatest demand in each of these key areas and match the business plan to it. We believe there is a school model for all and in any context, but frequently, the dream can get in the road of a great strategic plan. Different cultural factors also apply in unique markets. What parents want, what they need, market and economic forces, and the functional logistics of each curriculum need to be considered.

Staffing/Recruitment

This plan will be determined when you create your financial plan. The ratios of staff to students and your support and administration staff must be calculated carefully because as the school grows, these ratios will become more efficient. There are many ways to recruit with varying levels of associated costs, and you will get what you pay for. Be aware that as a new school, you are marketing yourself to new staff, not just students. Make sure you build a great website and promote yourself to this audience.

Financial Planning

For both non-profit and for-profit schools, a comprehensive business plan that outlines a sound financial strategy that encompasses both the short and long term is necessary. At GSE, our Market Research and Feasibility Studies come together with a comprehensive 10-year plan that identifies the break-even point, the first year of profit, and where the school should be after 10 years while allowing the facility to reach a sound financial position.

Have you considered:

Financing & Growth Strategy

Capital Requirements

Financial Strategy

Risk Analysis

Financial Plan

10-Year Budget Plan Revenue Model

Expense Assumption

Income & Expense Estimates

Competitive Analysis

A Competitive Analysis allows us to identify competition, find the gaps in the market, and understand what other schools do well. When done correctly, a competitive analysis will churn out plenty of quantitative and qualitative data that will allow us to back up business decisions. It can help:

• Develop and/or validate your identified Unique Selling Points.
• Ensure your school also focuses on the aspects of competitors that their parents value the most.
• Capitalise on competitors’ weaknesses that parents complain about.
• Get benchmarks to measure your future growth against.
• Uncover market segments that aren’t fully served by other schools but is needed by students and parents.

GSE will often compare about 10 other schools in a competitive analysis. In reality, it actually depends on the city and country you are in. For example, you may need to compare more schools in Kuala Lumpur due to the saturated market. This number may be lower in developing countries such as Myanmar or Cambodia.

So what should be measured? There are obvious aspects such as price, curriculum, percentage of local vs. foreign teachers, social media channels, and even reviews from parents, and many more points that you can find here!

Many other steps are involved in setting up a school, and our approach to Market Research and Feasibility Studies is just the first important but relatively small step. Contact us directly for a video conference to learn even more about how GSE tailors a plan to the needs of the owner and the market.

What are GSE Feasibility Studies and Reports Like?

“Our reports range from 50 to 250 pages in length. They are professional documents used by anyone from small investors to private equity investors and family offices.”

“Our clients for a Feasibility Study and Financial Modelling have included some of the largest names in the education investment space.”

“Our financial models are the best in the industry. More than 10 years of operating schools and understanding the investment side of the education business have meant that our advice and strategic planning are trusted by global investment leaders.”

Why did GSE first begin offering this invaluable Feasibility Study service?

For more than 10 years, some of the world’s largest investment groups have sought GSE leaders’ advice on market trends and analysis. GSE is where the market investment leaders go to know what is happening and what will happen next in all major regions. We decided to unlock this vault of information for school investors and operators.

We want schools to succeed, and they will only do so with thorough and comprehensive planning. We don’t just find and share data. We are education experts, so data comes to life in real conversations and real plans that make new schools succeed. GSE creates a business plan with credible arguments that support a clear vision and mission.

Strategic plans need to be well supported by experts in the industry.

GSE creates new school brands

GSE represents several very unique and famous school brands from the UK, Australia and the USA

GSE provides specialist services for setting up all types of education institutions, including international schools, kindergartens, vocational colleges, universities, and online/virtual schools.

Related Blogs

• Steps to Setting Up a New School
• How to Build a Comprehensive Competitive Analysis of Schools
• 10 Steps and Articles on How to Set Up a New School
• GSE International School Franchise Models