Buying a home tutoring franchise can be a huge mistake
You are currently at the franchise expo looking at a franchise to purchase. You try to find a particular franchise that peaks your interests and makes a profit eventually. You are attracted to a home tutoring franchise that seems like it is inexpensive. Low overhead cost is attracting you. You soon realise that your franchise is territory limited. Here are reasons why you should avoid this bad investment at all costs.
We have been running our tutoring business for 10+ years. Our agency started when only a few home tutoring agencies existed. There was very little competition then, so It only made sense to franchise and some tutoring agencies decided to go ahead and do so. Now home tutoring agencies are a “dime a dozen” and they are not territory dependant either. Many of these “new” home tutoring agencies fail during their first year or two due to the lack of business management experience, organisation, accounting, education expertise or all of the above. However, they new agencies are still out there and there is a new one is popping up every month or so. That means less profits to go around for your franchise especially since you can’t venture out of your small territory!
Just type a simple search like “tutors in Toronto” on google and you will see how many home tutoring agencies are listed on Google adwords alone. This does not include those agencies that don’t advertise on Google adwords, or those agencies that are not on the first page of google!
It just does not make sense to buy a tutoring franchise at this point. It would not be a bright move to buy a home tutor franchise for 25k or more. All you will be doing at this point is investing into something that is going to be very difficult to start making noticeable profits.
Reasons why you should avoid buying a home tutoring franchise.
- Competition is fierce and there is now less money to go around
- Buying a specific territory is only going to make your profit margin very slim
- Your fellow franchisee may overlap you territory or turf without you knowing it
Reasons why you should buy a tutoring centre franchise instead of a home tutoring franchise
- Initial investment is more but more profits in return
- No competition – You are usually the only tutoring centre that operates in the mall, office building, or community centre with no other competition around for at least a block or two.
- They say build a location and they will come. This is very true. Thousands of people per day will pass by your location everyday
- You tutors are employees not sub-contractors. This can be very beneficial as you are constantly monitoring and improving the quality of educators in your tutoring centre.
- Usually less expensive than home tutoring which will attract more customers in the long run