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skim234
Joined: 02 Sep 2009
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 Posted: Fri Nov 27, 2009 1:34 am Post subject: Hagwon student attrition? |
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I've been working at a hagwon in Ilsan for almost 2 months now. I really enjoy it here, but unfortunately I've noticed for every 1 new student we have, there seems to be about 3-4 leaving.
Is this frequent movement common? Also, What signs are there that my hagwon might be shutting down or making staff cuts? I just moved here and while I have an F4 visa that allows me to stay here post-job, I have bills to pay... |
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T-J
Joined: 10 Oct 2008
Location: Seoul EunpyungGu Yeonsinnae
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| Posted: Fri Nov 27, 2009 2:21 am Post subject: |
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Movement and ups and downs are a part of the business and it is the season for movement as tests and the year are winding up.
The best gauge is the student to teacher ratio.
40 students per teacher = healthy.
30 students per teacher = could be doing better but still paying the bills
20 students per teacher is the red line that should send up some warning flares for you.
Anything below that and you should probably start your job search. |
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dragon777
Joined: 06 Dec 2007
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| Posted: Fri Nov 27, 2009 2:59 am Post subject: |
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Good analysis chart T-J. Also, if students are 20 or below and your pay
starts being late. Definately start looking for a new job. |
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skim234
Joined: 02 Sep 2009
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| Posted: Fri Nov 27, 2009 3:01 am Post subject: |
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| T-J wrote: |
Movement and ups and downs are a part of the business and it is the season for movement as tests and the year are winding up.
The best gauge is the student to teacher ratio.
40 students per teacher = healthy.
30 students per teacher = could be doing better but still paying the bills
20 students per teacher is the red line that should send up some warning flares for you.
Anything below that and you should probably start your job search. |
Thanks! When I started we were probably around the 40:1 rate. Now it's probably around 35 or so. |
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caribmon
Joined: 26 Oct 2009
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| Posted: Fri Nov 27, 2009 3:12 am Post subject: |
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| When I arrived we had 25 students per teacher. Now we have 17 students per teacher. Break even is 28 students per teacher at our school. Things are really bad at my campus. I gave my 6 weeks notice today. Things are tight folks. 3.0% savings rate when survival inflation is 10% per year, school is one of the first things to be cut. |
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ontheway
Joined: 24 Aug 2005
Location: Somewhere under the rainbow...
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| Posted: Fri Nov 27, 2009 7:39 am Post subject: |
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| T-J wrote: |
Movement and ups and downs are a part of the business and it is the season for movement as tests and the year are winding up.
The best gauge is the student to teacher ratio.
40 students per teacher = healthy.
30 students per teacher = could be doing better but still paying the bills
20 students per teacher is the red line that should send up some warning flares for you.
Anything below that and you should probably start your job search. |
Sorry, T-J, but that's just way off, if you're talking about total students per foreign teacher and not class size or something else.
For a typical hogwan, the total cost of the teacher, staff, rent, utilities, taxes, vans, van drivers, etc. ... The school will be lucky to break even at 60 students per teacher. Most hogwans need 80 to 100 students per teacher to be healthy. Below 50 and your school is losing money and may fail.
80 - 100+ students per teacher ... School is probably healthy, unless management is inept.
60 - 80 students per teacher ...... struggling, paying the bills, but things are tight
40 - 60 students per teacher ...... probably losing money, might survive, change is needed
below 40 per teacher ................ some combination of financial genius and donated operating funds will be needed to keep going. Perhaps you work for a non-profit charitable hogwan. Perhaps you should stay ready to look for a new job.
(The numbers will be quite different for a kindy, where the kids have more hours and much higher per student fees, and yet again different for a private school, where the students attend day classes in lieu of attending public schools and tuition rates are huge. This appears to be the case of caribmon's post above, with a break even rate of 28, it must be a private school or kindy.) |
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skim234
Joined: 02 Sep 2009
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| Posted: Fri Nov 27, 2009 10:21 am Post subject: |
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| I work at an after-school hagwon. If 80:1 is healthy, there can't be too many hagwons that are well off. |
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ontheway
Joined: 24 Aug 2005
Location: Somewhere under the rainbow...
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| Posted: Fri Nov 27, 2009 10:44 am Post subject: |
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| skim234 wrote: |
| I work at an after-school hagwon. If 80:1 is healthy, there can't be too many hagwons that are well off. |
How many classes do you teach?
How many days / hours per week per class?
How many students are in each class?
ex: 6 classes/each class meets 5 days@ 50 min per day/12 students per class
total 30 hours (inc breaks) /72 students |
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somethingawful
Joined: 26 Nov 2008
Location: Daejeon
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| Posted: Fri Nov 27, 2009 1:17 pm Post subject: |
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Here's the best way to tell.
Business is off:
Your boss comes to work hungover and stinking of whiskey only 4 days a week.
Business is slowing:
Your boss starts cutting back on his room salon trips.
Business is bad:
Your boss turns the thermostat down 5 degrees and closes the windows.
The Hagwon is in trouble:
You boss starts having sex with his wife instead of prostitutes.
The Hogwan is losing money hand over fist:
You boss starts coming into work hungover every day stinking of Soju and Cass.
The Hogwon is going to be be sold this week:
You boss is frantically pulling copper wires out of the walls.
The Hogwon has been sold:
Your boss starts going back to room salons. |
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T-J
Joined: 10 Oct 2008
Location: Seoul EunpyungGu Yeonsinnae
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| Posted: Fri Nov 27, 2009 7:37 pm Post subject: |
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| ontheway wrote: |
| T-J wrote: |
Movement and ups and downs are a part of the business and it is the season for movement as tests and the year are winding up.
The best gauge is the student to teacher ratio.
40 students per teacher = healthy.
30 students per teacher = could be doing better but still paying the bills
20 students per teacher is the red line that should send up some warning flares for you.
Anything below that and you should probably start your job search. |
Sorry, T-J, but that's just way off, if you're talking about total students per foreign teacher and not class size or something else.
For a typical hogwan, the total cost of the teacher, staff, rent, utilities, taxes, vans, van drivers, etc. ... The school will be lucky to break even at 60 students per teacher. Most hogwans need 80 to 100 students per teacher to be healthy. Below 50 and your school is losing money and may fail.
80 - 100+ students per teacher ... School is probably healthy, unless management is inept.
60 - 80 students per teacher ...... struggling, paying the bills, but things are tight
40 - 60 students per teacher ...... probably losing money, might survive, change is needed
below 40 per teacher ................ some combination of financial genius and donated operating funds will be needed to keep going. Perhaps you work for a non-profit charitable hogwan. Perhaps you should stay ready to look for a new job.
(The numbers will be quite different for a kindy, where the kids have more hours and much higher per student fees, and yet again different for a private school, where the students attend day classes in lieu of attending public schools and tuition rates are huge. This appears to be the case of caribmon's post above, with a break even rate of 28, it must be a private school or kindy.) |
| ontheway wrote: |
How many classes do you teach?
How many days / hours per week per class?
How many students are in each class?
ex: 6 classes/each class meets 5 days@ 50 min per day/12 students per class
total 30 hours (inc breaks) /72 students
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Look at your own example again. By your example and your chart, a teacher with 12 students in each class teaching 30 classes a week is "struggling, paying the bills, but things are tight."
I'll stand by my numbers as a rough general guide for how well your hagwon is doing. Not sure how much experience you have in actually running one.
Think of it as 40 students * 200,000 tuition = 8 million won generated by that teacher. When I say 40 / teacher that is the minimum cut off for "doing well" or "healthy".
Realistically you can't exceed 70 students per teacher and maintain a competitive class size. Again by your own example, teaching 30 hours and a class size of 12 you only have 72 students. |
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BoholDiver
Joined: 03 Oct 2009
Location: Canada
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| Posted: Sun Nov 29, 2009 3:48 am Post subject: |
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40 per school seems about right.
We have 120 or so with 2 foreign teachers, 1 K teacher, 1 more part timer, desk lady, bus drivers, and the like. Apparently, business is good. |
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ontheway
Joined: 24 Aug 2005
Location: Somewhere under the rainbow...
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| Posted: Sun Nov 29, 2009 7:35 am Post subject: |
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| BoholDiver wrote: |
40 per school seems about right.
We have 120 or so with 2 foreign teachers, 1 K teacher, 1 more part timer, desk lady, bus drivers, and the like. Apparently, business is good. |
Generally the Korean teachers cost far less per month than the foreign teachers, so the student ratio for the K teacher, and the overall ratio therefore is lower.
The big question: how many students do each of the foreign teachers handle, how many students per class, how many hours per week.
The hours each student studies determines the maximum legal tuition rate. Tuition rate times total students taught by each foreign teacher will tell us how the school is doing. |
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ontheway
Joined: 24 Aug 2005
Location: Somewhere under the rainbow...
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| Posted: Sun Nov 29, 2009 7:55 am Post subject: |
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| T-J wrote: |
| ontheway wrote: |
| T-J wrote: |
Movement and ups and downs are a part of the business and it is the season for movement as tests and the year are winding up.
The best gauge is the student to teacher ratio.
40 students per teacher = healthy.
30 students per teacher = could be doing better but still paying the bills
20 students per teacher is the red line that should send up some warning flares for you.
Anything below that and you should probably start your job search. |
Sorry, T-J, but that's just way off, if you're talking about total students per foreign teacher and not class size or something else.
For a typical hogwan, the total cost of the teacher, staff, rent, utilities, taxes, vans, van drivers, etc. ... The school will be lucky to break even at 60 students per teacher. Most hogwans need 80 to 100 students per teacher to be healthy. Below 50 and your school is losing money and may fail.
80 - 100+ students per teacher ... School is probably healthy, unless management is inept.
60 - 80 students per teacher ...... struggling, paying the bills, but things are tight
40 - 60 students per teacher ...... probably losing money, might survive, change is needed
below 40 per teacher ................ some combination of financial genius and donated operating funds will be needed to keep going. Perhaps you work for a non-profit charitable hogwan. Perhaps you should stay ready to look for a new job.
(The numbers will be quite different for a kindy, where the kids have more hours and much higher per student fees, and yet again different for a private school, where the students attend day classes in lieu of attending public schools and tuition rates are huge. This appears to be the case of caribmon's post above, with a break even rate of 28, it must be a private school or kindy.) |
| ontheway wrote: |
How many classes do you teach?
How many days / hours per week per class?
How many students are in each class?
ex: 6 classes/each class meets 5 days@ 50 min per day/12 students per class
total 30 hours (inc breaks) /72 students
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Look at your own example again. By your example and your chart, a teacher with 12 students in each class teaching 30 classes a week is "struggling, paying the bills, but things are tight."
I'll stand by my numbers as a rough general guide for how well your hagwon is doing. Not sure how much experience you have in actually running one.
Think of it as 40 students * 200,000 tuition = 8 million won generated by that teacher. When I say 40 / teacher that is the minimum cut off for "doing well" or "healthy".
Realistically you can't exceed 70 students per teacher and maintain a competitive class size. Again by your own example, teaching 30 hours and a class size of 12 you only have 72 students. |
My example was intended to ilicit the information required to determine how the OP's school might be doing. You cannot assume a "price" or tuition rate without more info, especially 200k won as you did, which is well above the average tuition for an English hogwan and would be an illegal price at most hogwans.
To have a legal tuition rate of 200k would require approx 20 class hours per month for each student, according to and depending on variations in the local education office rules. The example I gave, with 50 min classes would have a max tuition of 140k to 160k in most parts of Korea. It generally costs a school 3.5 to 4 million won per month for the total direct costs of a foreign teacher. (Korean teachers generally cost only 1.0 to 2.5 million.) It will cost a similar amount per month to pay for the indirect and fixed costs: rent, utilities, vans, van drivers, insurance, interest payments, office staff, manager, cleaning staff, equipment and supplies, divided per teacher. There are economies of scale involved, so the costs will be lower per teacher as the number of teachers and students increase. At some point, diseconomies of scale set in, and per teacher costs rise at single locations. This is when the financial benefits of franchising take over.
Inspite of reports that hogwans may now charge any price they want, due to a recent court ruling, the local education offices have interpreted this to mean that they must allow schools to apply for rates higher than their scale which they can approve or deny. They will approve exceptions only if they feel they are justifiable. The legal price does not take into account the higher cost of foreign teachers nor class size. It is based on an assumption of lage classes and low cost Korean teachers. Of course, recent reports have said that up to 70% of hogwans of all kinds charge more than the legal max. |
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T-J
Joined: 10 Oct 2008
Location: Seoul EunpyungGu Yeonsinnae
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| Posted: Sun Nov 29, 2009 2:34 pm Post subject: |
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| ontheway wrote: |
My example was intended to ilicit the information required to determine how the OP's school might be doing. You cannot assume a "price" or tuition rate without more info, especially 200k won as you did, which is well above the average tuition for an English hogwan and would be an illegal price at most hogwans.
To have a legal tuition rate of 200k would require approx 20 class hours per month for each student, according to and depending on variations in the local education office rules. The example I gave, with 50 min classes would have a max tuition of 140k to 160k in most parts of Korea.
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The only point I will concede to you is that my example is based on Seoul and not "most parts of Korea." Elementary student get about 18 hours a month and Middle / High school 26 hours. 200k is a very conservative tuition, for Seoul.
Again your numbers require classes of 12 students in each of your 30 classes to be at a "healthy" hagwon. I think that's high, but am more than happy to agree to disagree. Peace. |
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