Moreover, as the sector’s total revenue exceeds $150 million a year, it also presents a fabulous opportunity to create a sustainable and successful business.
Like any venture, though, the key to success is to maintain a tight ship, which is why you should look for cost-saving opportunities at every turn.
But how can you go about doing this?
Here are seven ways education companies can save money on their running costs and annual expenses.
1. The buying of equipment for students
If your business offering requires you to buy equipment for students, then it pays to order as much of it as you can in one go to enjoy economies of scale.
For instance, if you purchase headphones in bulk, you will save a lot of money in ongoing costs compared to if you ordered them on a needs-basis.
The same applies to books, electronic devices and any other resource you need to buy to give your students the best chance of achieving academic success.
To do this, you will need to forecast effectively. While it involves balancing acts to ensure you don’t overorder, if you can do it well, you can save a lot of money throughout the year.
2. Automate where possible
Automation is a tool that every business should adopt, irrespective of the industry in which they operate.
However, it is especially useful for education companies because automating specific processes better enables them to allocate their resources elsewhere within the organisation.
Activities like tracking attendance, scheduling courses, and collecting fees can be quite labour-intensive. So, embracing software that automates this process can not only reduce your costs but also significantly free up the time and energy your employees need to devote to them.
3. Reduce paper usage
Did you know that the average school spends between $30k to $50k a year on paper, which equates to about six million individual sheets.
Moreover, education companies aren’t that far behind in terms of consumption. So, it pays to reduce your usage of it by transitioning to a paperless office.
Many education-based organisations are ditching traditional paper learning models, partly to save costs and the environment and also to comply with modern preferences.
Instead, they are moving to a device or cloud–based one that can be accessed by specific software and are saving a fair bit of money in the process.
4. Outsource
In most education businesses, staff represents a major part of the expenditure. For this reason, you should consider outsourcing as many aspects of your daily operation as possible.
The benefit of outsourcing is that procuring the services of experts in any given field can improve your labour costs and enhance your overall efficiency.
This strategy also provides you with access to talent from around the world, which means you could benefit from 24-hour production.
It can also be a less risky way of conducting your business, as it reduces your chances of hiring someone on a permanent basis who might not be the most suitable fit.
5. Rent out office space
In recent times, there has been an increasing take up of education companies renting out part of their office space for events or organisations.
This helps them to reduce their overall operational costs through the sharing of rent and utilities.
It is a particularly handy solution for small businesses that cannot yet afford to fund a fully-fledged workspace.
Depending on the space you have available, leasing out part of your premises can help you recoup significant costs and potentially even make a profit.
6. Move offices
If you don’t fancy sharing your office space with other people, you should consider moving to another property as a way to save money.
Doing this could involve downsizing or relocating to another location where rent might be cheaper. However, as the cost of rent is often tens of thousands of dollars or more a year, you can slash a fair whack of your expenditure just by moving to another space that isn’t as expensive as you are currently paying.
If you don’t need to be based within the CBD, consider moving to a less expensive suburb or even a more rural area.
For self-employed business owners, there are several loan options to help them manage their short-term cash flow while they move.
7. Reduce energy bills
Another spiraling cost many education companies face is their energy bills. This is due to the high expense of running air conditioning and heating systems, as well as their lights and other electrical equipment.
To keep these tariffs down, there are several things you can do. One of the main ones is to change your system and lightbulbs to more energy efficient models.
Additionally, you should switch off as much of your equipment and as many lights and power points as you can every night.
Don’t be afraid to change providers to a company that will give you a cheaper rate, and consider generating your own energy by embracing solar power.
