Dear great business minds, turn my co. around (Long)

[DrewDevil]

I agree that marketing is the problem, unless your teaching is substandard. You may want to read the book "Guerrilla Marketing" to understand the marketing mindset and also get tips on how to generate business inexpensively.

[theclock]

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Questions and suggestions:

When someone signs up for a class, is there a contract for a certain number of months?

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None. The contract only specifies the rules and regulations. Charges on a monthly basis. I’ve thought about locking the students up for 6 month contract and charging everything upfront. Downfall of that is that most competitors charge monthly, nowadays people do not like to be locked into a contract. The freedom of pay per month suits most. There is one school that charges thousands of upfront money and offers six months-one year contracts. It is “The Big One” their clientele on average are wealthier than mine. To answer an upcoming question, the big school does a FULL TIME sales person in their company. I do not have that luxury. I may reconsider.

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It sounds like you have cut labor to the bare minimum and are unable to combine any more classes. So stop thinking of it as a variable expense. It is a fixed cost much like rent.

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Excellent point. Concur 100%

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You don't have the cash for traditional marketing. Turn your teachers, students, and parents into your marketing team. Make the incentives big.

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Yes, this is easier said than done. Unbelievably as it sounds, some are not motivated by money. Some do not want to become sales people. My 50% discount referral campaign on next month’s tuition only brings me about 5-10 new students every year. I need a better, newer, sexier, campaign. The mothers are powerful! The word of mouth influences they have on their friends are magical. If I find the right campaign to motivate them, a lot of my problems will be solved.

Incentives for my teacher, the current system are $20 cash for every new student they interview or refer.

Agree that the incentives need to be bigger; also I have to teach them how to go out and sell. Most of my teachers are only teachers they have no concept of selling. Even if they have the heart to help to the company most won’t even know where to start. I now realize that a lot of people need to be given instructions, most do not know how to go out and get things done on their own.

How can I tell them to get out there and sell? One thing for sure is, my staff at this time supports me 100% I treat them well in good times and bad times. They know I am a very fair and generous person.

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Teachers:
Offer them $x per month of the tuition cost for each student they refer. Example: If they get a new student to sign up for a $100 a month program. Give the teacher a $20 a month bonus as long as the student is paying tuition.

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As stated above, this is the exact system I’ve had for the past 4 years. I want to give out money; the more I give the better it is for everyone. Results have been mediocre at best.

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Students & parents:
Offer students/parents $x a month discount on tuition for each new student they refer. Example: If they get a new student to sign up for a $100 a month program. Give a $20 a month discount on tuition. Make the discount cumulative. Five referrals of a $100 class would give them $100 off their tuition up to a 100% discount potentially making the classes free. How long the discounts would last is dependent on if you have contracts for the programs.

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The current referral program is exactly this. I maybe wrong, but it seems that a lot of people in Asia are worried about losing face. They are scared that if they refer a friend and the friend won’t like the school. When I introduced this system, my thought was that it would be a success. I am giving 50% off next month’s fee yet very few are willing to refer. I’d even go as far to say that some adults don’t even tell their friends that they are studying English. Almost all of the referrals have come from my children student base.





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Appearance:
You have been focusing on money issues. How does the school look? This includes the inside, ouside, halls, classrooms, offices, teachers, and you. Make sure everythiing is tip-top. No clutter, no cobwebs, nothing old and dusty, everyone dressed appropriately. Paint it, pitch it, or fix it. Since most people have a blind eye to their usual surroundings, you might want a friend to visit and look for imperfections.

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I don't know how viable the suggestions are for you, but they might give you some ideas to help improve your situation.

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I really appreciate it. The ideas will surely help. Pamphlets, brochures are basically a must for me at this point. They are cheap to make. I’ve set up a great deal with the local newspaper; I’ll be including inserts in their newspaper in certain areas in town.


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you need a full time sales person.



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I haven’t thought about this. It’s a great idea.

Last year I did hire a teacher/salesperson. Found out that he is a great teacher but not so good at selling. He works his butt off and has a great attitude. Unfortunately, he cracks under pressure and stresses way too easily. He needs constant directions/instructions. I need a person that can run with the ball if I give it to him/her.


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Change your referal program. When someone brings you a new student pay them in cash during class. Hand them the money and a coupon for double bonus on the next student they bring. Also give the new student a double bonus coupon. Make this a big deal for all to see. Gererate some excitment. Crunch some numbers on the exact bonus, but I think 50% off next months class is way too high.




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I will do this.


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Hire a full time (mostly commission) sales person. This should be someone with connections to large groups. Someone who knows and has daily contact with lots of people. Pay them on a sliding scale. Set it up so they don't make much until the "10th" new student and then get a big bonus.



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If I can find such a person, problem solved.
As stated above, I thought the person I hired last year was able to do this. I’ve already posted an opening in the employment agency. Hopefully some good people will apply.




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how many concurrent students do you need to be able to continue the business?




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Great question! 60 more, I won’t get rich but it’ll be enough for the company to survive. The staff will be able to keep their jobs.

I need 60 more students! I have just less than 6 months to accomplish this or it’s over. I’m learning to deal with stress much better; it’s not a very good feeling. My family and doctor are concerned because I suffered from ulcer last year. However after reading all the suggestions, hard work will give me a chance.

[mshalen]

I have a few suggestions that might help.

1. You have been living in Korea for at least 3 or 4 years yet you stated you don't speak Korean. Shame on you. How can you expect to market yourself to the locals if they can't understand you? Learn Korean!

2. Don't try and go head to head with the large national competition. This is a sure way to go broke. Go where the other guys aren't. Instead of trying to fill your classes with kids that sign up one at a time why not go after corporate clients? I would think companies that export/do business with the US/Europe would want to have some of their employees speak English. Companies have deep pokets and you can sell your service as part of their training program.

[livinitup0]

1. Learn Korean - If you are in the supermarket and see some random korean fighting his way through an english conversation, What do you do?? You have to know this is a marketing opportunity!!??....go up to him in his native language, help him right then and there get through what hes trying to say.....then give him a buisness card for the school. Boom...money.

Edit: I read a few more of the posts....since you dont really have time to learn Korean in 6 months [img]/images/graemlins/crazy.gif[/img] then I would have one of your bi-lingual teachers translate for you in your marketing efforts. Unfortuneately...I can seriously see you not learning the language as being a big reason some of this is happening now....not trying to be rude...just pointing it out.

You cant market a targeted area like that....and not even speak the same language. Korean people are a very proud but grateful people (Im assuming south korea) you help them out, you'll see results.

2. Discounts - You need to be hitting up local groups and clubs and offering discounts. Tae Kwon Do is like the baseball of korea....why dont you or some of your students go down to some of these bigger martial arts schools and offer a discount to the students and instructors. ...This could work with numerous types of recreational groups as well.

3. Corporate training - go to buisnesses that usually cater to english speaking customers....give the owner a discounted bulk price to train his staff how to speak english....people leaving their jobs is so much more rare in korea that employers usually go the extra mile for their employees.

4. More paper ads - I just personally think this would be the best media in which to advertise.

GL
Richard

[VeryTnA]

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Hire a full time (mostly commission) sales person. This should be someone with connections to large groups. Someone who knows and has daily contact with lots of people. Pay them on a sliding scale. Set it up so they don't make much until the "10th" new student and then get a big bonus.




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If I can find such a person, problem solved.
As stated above, I thought the person I hired last year was able to do this. I’ve already posted an opening in the employment agency. Hopefully some good people will apply.


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Work on getting the right combination of salary and bonus. Your good sales people will make great money and stay with you. The bad ones will move on to other jobs on their own. Always be interviewing and hiring. When you hire someone lay out the minimun requirements they must meet after a short training period. Make your top sales person "marketing manager" so that your may use your time better.

Remember your school cares about its students and is the best at teaching English with a personal touch. Your school is not the big diploma mill.

[theclock]

First, let me explain the language barrier. I said that I do not speak the language. It was my mistake of not explaining it properly. Yes, I speak a little.

I can carry on a small easy conversation. I don’t believe that it’s at an acceptable level to approach someone for business meetings just speaking the basics. Actually, I still consider that to not knowing the language. Is that the main cause of me not succeeding? No, I don’t think so.

Knowing the language is important, but there are many people that invest in foreign countries where they do not speak the language. China is a good example. A lot of foreigners are investing there now and can’t speak Chinese. My friend who is Australian now works in Italy. It has taken him nearly 6 years to learn Italian yet he is not yet fluent. I do take lessons myself (twice a week) not enough but now I have little free time. If I am able to get back into the black my focus will again be on learning the language.

Discounts: They are a must, however I have to be careful to not price myself out of the market. Even now my rate is very comparable to the competition. My profit is small cause labor and rent is not cheap.

Asians tend to think that too cheap = low quality. Years ago, Korea was the capital of the world for brand name replicas. Women would all be wearing designer clothes and carrying LV, Gucci, Chanel, Fendi, etc… handbags. Nowadays, the fear of embarrassment is so big many rather save up for the real thing than buy great quality, exact looking fake bags. I don't want them to be embarrassed to say my school name. Price is important but now I am selling a service and “brand school” I must be very careful in the pricing category.

Not a good analogy but take golf for example, the Butch Harmon School is expensive, we know Butch is good but he is not the person teaching you how to swing a golf club, his instructors are. Now go to a local PGA pro, his fee is cheap but is the quality THAT big a difference? We don’t know? All we know is that Butch Harmon is the best and deserves the high fee.

If I make it too cheap some people will automatically believe that the other schools must be better. It’s not a pricing war. Once I have a chance to give a trial lesson it is up to me to win over the potential client. They will not care so much about the ten or twenty bucks they save per month. Most people nowadays check out all schools first for free trial classes. It is then upto my staff to close the deal. Getting them in for a trial class is the key right now. More visitors = more chances = more students. History shows that my school can convert 8 out of ten visitors. The quality of my staff is the best in town. Problem is not many people know that. I need them to walk in my door. As the posts have mentioned, paper ads is the cheapest in getting the word out.
What’s a good headline? I want them to look at my schools insert/brochures, not throw them away.

[Ron_Mexico]

My advice would be to shut down and start a new project/career. Why go threw the hasstle with this business. Take the knowlege you have learned from this business and move on. Do you want to sit in this small town forever and run a second rate english school. Move on my friend. This business is depressing you. The end of this will be the begining of something else.

[elus2]

Set some goals for acquiring new students within certain time periods. If you surpass these goals it may help in convincing friends/family to give you a short term loan to finance the business until it's finally back on its own two legs. This may give you the breathing room you need in order to be successful.

Good luck.

[Allinlife]

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talking to guidance counselors (or whatever the equivalent in Korea is)

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lol sorry just had to laugh at that..

[DrewDevil]

Do not compete on price! That is a sure way to run yourself out of business... instead, focus on quality and value.