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shostahoosier
Joined: 14 Apr 2009
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 Posted: Wed Mar 30, 2011 5:38 am Post subject: I was approached about starting a hagwon... |
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So I recently found out that my school "can't" recontract me. I told one of the parents about this (a local pastor) and he told me that he wanted to start a hagwon and asked if I would be interested.
I was polite and didn't say no but the whole "only 10 random days of vacation" thing really turns me off to hagwons. The bright side is that it would keep me in my area which would be nice since I really only wanted to do 1 more year in Korea and then return to my career in the US. A new school would mean learning things all over again.
Am I crazy for considering this option? He seems to think that he will have a monopoly on English because there won't be any elementary school English teachers in my town. I think the guy is cool, but I know how money/business changes people. |
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some waygug-in
Joined: 25 Jan 2003
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| Posted: Wed Mar 30, 2011 5:48 am Post subject: |
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I've found that most Koreans dream of running their own hagwon. They have idealized notions of what running a hagwon means and think it's going to be instantly successful with little or no work involved.
If they ever get the chance to make that dream a reality they find that things are not so wonderful as they had imagined.
I don't know anything about the guy you mention, but I'd be very cautious and I would make sure he had more going for him than just wanting to start a hagwon.
Does he have any idea what he's getting himself (and possibly you) into?
Does he have any business experience?
Does he think that money and students are just going to fall from the trees? |
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bobbybigfoot
Joined: 05 May 2007
Location: Seoul
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| Posted: Wed Mar 30, 2011 6:23 am Post subject: |
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| How much cash does he have to put into this business? If he says something like between half a million and a million then go for it. |
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shostahoosier
Joined: 14 Apr 2009
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| Posted: Wed Mar 30, 2011 3:32 pm Post subject: |
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| bobbybigfoot wrote: |
| How much cash does he have to put into this business? If he says something like between half a million and a million then go for it. |
Is the half a million Dollars or Won? |
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sulperman
Joined: 14 Oct 2008
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| Posted: Wed Mar 30, 2011 4:05 pm Post subject: |
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| shostahoosier wrote: |
| bobbybigfoot wrote: |
| How much cash does he have to put into this business? If he says something like between half a million and a million then go for it. |
Is the half a million Dollars or Won? |
No way, to open a small, one teacher hagwon in a small town/city will cost practically nothing.
Random numbers I am pulling out of my ass:
School/office deposit- 10 mil
Monthly rent- 700K (so one year- 8.4 mil)
Interior design of two rooms (office and classroom) 3 mil (I have no idea how much this would be but I am sure it would be far, far, far cheaper than in the west)
Big TV in classroom- 1 mil
Advertisement flyers- 100K
Big banners with your pretty face on them to put on the big poles downtown: 500K (again, no idea)
One of those old-timey sashes that you can wear when you stand downtown handing out flyers for your school. 10K
Electricity/gas- 1 mil for the year
Used bus: 10 mil (the pastor drives it)
So under 34 million for the year, plus another 36 or so for you, so 70 mil to make sure it is all smooth sailing for at least one year. I would strongly recommend some sort of profit sharing scheme with a minimum pay for you built in.
Half a mil to a mil (in US dollars) is necessary for a big hagwon with multiple teachers, not what is more or less a study room with just one teacher. |
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ttompatz
Joined: 05 Sep 2005
Location: Kwangju, South Korea
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| Posted: Wed Mar 30, 2011 4:08 pm Post subject: |
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| shostahoosier wrote: |
| bobbybigfoot wrote: |
| How much cash does he have to put into this business? If he says something like between half a million and a million then go for it. |
Is the half a million Dollars or Won? |
Quarter million dollars (or won equivalent) as a minimum to meet the requirements of licensing.
He might get by with less by using his church to hold classes in but he won't be able to sponsor you for a visa.
. |
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shostahoosier
Joined: 14 Apr 2009
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| Posted: Wed Mar 30, 2011 4:18 pm Post subject: |
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| sulperman wrote: |
| shostahoosier wrote: |
| bobbybigfoot wrote: |
| How much cash does he have to put into this business? If he says something like between half a million and a million then go for it. |
Is the half a million Dollars or Won? |
No way, to open a small, one teacher hagwon in a small town/city will cost practically nothing.
Random numbers I am pulling out of my ass:
School/office deposit- 10 mil
Monthly rent- 700K (so one year- 8.4 mil)
Interior design of two rooms (office and classroom) 3 mil (I have no idea how much this would be but I am sure it would be far, far, far cheaper than in the west)
Big TV in classroom- 1 mil
Advertisement flyers- 100K
Big banners with your pretty face on them to put on the big poles downtown: 500K (again, no idea)
One of those old-timey sashes that you can wear when you stand downtown handing out flyers for your school. 10K
Electricity/gas- 1 mil for the year
Used bus: 10 mil (the pastor drives it)
So under 34 million for the year, plus another 36 or so for you, so 70 mil to make sure it is all smooth sailing for at least one year. I would strongly recommend some sort of profit sharing scheme with a minimum pay for you built in.
Half a mil to a mil (in US dollars) is necessary for a big hagwon with multiple teachers, not what is more or less a study room with just one teacher. |
LOL thanks for putting it in perspective sulperman...it's a no 
If I wanted to hand out flyers to be a dancing monkey...I'd go to Japan. |
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wooden nickels
Joined: 23 May 2010
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| Posted: Wed Mar 30, 2011 4:51 pm Post subject: |
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| sulperman wrote: |
| shostahoosier wrote: |
| bobbybigfoot wrote: |
| How much cash does he have to put into this business? If he says something like between half a million and a million then go for it. |
Is the half a million Dollars or Won? |
No way, to open a small, one teacher hagwon in a small town/city will cost practically nothing.
Random numbers I am pulling out of my ass:
School/office deposit- 10 mil
Monthly rent- 700K (so one year- 8.4 mil)
Interior design of two rooms (office and classroom) 3 mil (I have no idea how much this would be but I am sure it would be far, far, far cheaper than in the west)
Big TV in classroom- 1 mil
Advertisement flyers- 100K
Big banners with your pretty face on them to put on the big poles downtown: 500K (again, no idea)
One of those old-timey sashes that you can wear when you stand downtown handing out flyers for your school. 10K
Electricity/gas- 1 mil for the year
Used bus: 10 mil (the pastor drives it)
So under 34 million for the year, plus another 36 or so for you, so 70 mil to make sure it is all smooth sailing for at least one year. I would strongly recommend some sort of profit sharing scheme with a minimum pay for you built in.
Half a mil to a mil (in US dollars) is necessary for a big hagwon with multiple teachers, not what is more or less a study room with just one teacher. |
One/he needs more than 70 million to start a school, if he will be sponsoring you. Smooth sailing...? Right...umm |
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Juregen
Joined: 30 May 2006
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| Posted: Wed Mar 30, 2011 7:49 pm Post subject: |
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| bobbybigfoot wrote: |
| How much cash does he have to put into this business? If he says something like between half a million and a million then go for it. |
50.000.000 won, but it might have changed to 100.000.000 won by now. |
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Juregen
Joined: 30 May 2006
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| Posted: Wed Mar 30, 2011 7:56 pm Post subject: |
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| sulperman wrote: |
No way, to open a small, one teacher hagwon in a small town/city will cost practically nothing.
Random numbers I am pulling out of my ass:
School/office deposit- 10 mil you mean 30-50M won
Monthly rent- 700K (so one year- 8.4 mil) you mean 1-2M won
Interior design of two rooms (office and classroom) 3 mil (I have no idea how much this would be but I am sure it would be far, far, far cheaper than in the west) there is the problem, you need far more pyong to start an actual official hagwon that can recruit teachers
Big TV in classroom- 1 mil waste of money
Advertisement flyers- 100K yeah right .... a budget of 5M won would be more appropriate
Big banners with your pretty face on them to put on the big poles downtown: 500K (again, no idea)
One of those old-timey sashes that you can wear when you stand downtown handing out flyers for your school. 10K
Electricity/gas- 1 mil for the year 400.000 won a month
Used bus: 10 mil (the pastor drives it)
So under 34 million for the year, plus another 36 or so for you, so 70 mil to make sure it is all smooth sailing for at least one year. I would strongly recommend some sort of profit sharing scheme with a minimum pay for you built in.
Half a mil to a mil (in US dollars) is necessary for a big hagwon with multiple teachers, not what is more or less a study room with just one teacher. |
Well I did it with 200.000 dollars, and carefully scaled the costs with the growth of the revenue. But yes, I had a negative cash flow for about 2 years.
Starting a school is not something you do in a few months, Parents are incredibly distrustful of any new school opening up, and if you want to go fast you need to buy into a franchise etc etc etc.. |
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bobbybigfoot
Joined: 05 May 2007
Location: Seoul
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| Posted: Wed Mar 30, 2011 8:01 pm Post subject: |
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I meant US dollars.
You want to make sure your sponsor is flush with cash so that he's not stressed out if enrollment is low in the beginning. The last thing you need is someone going bonkers every time a student withdraws or a mom issues a complaint. And you want to make sure you are going to get paid.
Those that suggest he go into business with a guy who has 70 million won to invest, well, you really don't know what you are talking about. |
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