What are the startup costs, running costs, and potential revenue from starting a language school (eikaiwa)?
The typical salary for English teachers in Japan is about 250,000 yen ($2,500 USD, $1=100yen) which sounds great at first, but considering the late hours, expensive cost of living in Japan, and the fact that your salary will probably not go up more than 3 to 5% for your entire life, it’s natural that some people start to look for more lucrative opportunities.
Starting an eikaiwa is a great chance to make more money, have more control over lessons and teaching, and it lets you be the boss. There will be many difficult decisions in the process of starting and running your business. I will talk about the five tips that I picked up along the way so that others can start their companies more efficiently with a higher chance of success.
5 Things That Will Improve Your Chances of Success for Your Language School
1. Start Your School Strong With an Amazing Name
This might seem like common sense, but your conversation school’s name is one of the most important aspects of your business. It’s the way people will remember your school and your brand. In my case, I couldn’t decide which was better: a name in English or Japanese? It seems like a minor point, but considering that our customers are typically Japanese people, we went with a name that could easily be understood in both languages. Remember that even if someone can speak two languages, reading something in their native language will always have a stronger impact due to instant recognition and deeper understanding of the content.
For example, imagine an American called Bob thinking about starting an eikaiwa. He decides to choose one of the two names, “Bob’s English School” or “Bob’s Eikaiwa.” While “English School” is obvious to native English speakers and represents the business’s purpose, Bob’s customers might not instantly recognize the English and may take a few extras seconds to process the business name. Side by side with another company which has a Japanese title like “eikaiwa,” Bob’s school might lose to the competitor due to the customers familiarity with Japanese.
I’m not saying one is necessarily better than the other, but it’s important to take these things into consideration. Personally, I think neither are excellent choices. A great name should describe the company but also have a strong impact and be easy to remember. To read more about this topic, you can check out my other blog post which goes into more detail about why there’s little benefit from using your own name for your English language school (eikaiwa) or small business in Japan.
Since your business name will be the initial impression of your company to your customers, it’s important to take your time and think carefully. Doing a google search for local English schools might be helpful to get some ideas and understand who you will be competing with. I chose Step by Step Kids English as the name for my school, and I’ve been happy with the decision from day one.
2. Choose an Effective Team for your school
When starting your English school, some important questions you must ask yourself are “What kind of school do you want to have five years from now, and how large do you want your business to grow in the long run?” The answer to these questions will determine how to initially set up your business and what resources will be necessary.
If you are just hoping to get enough students to sustain your own income, then starting with a team of one or two people is possible. This will keep your monthly expenses low since you have fewer salaries to pay. You will be doing most of the teaching, however, so there will be fewer opportunities to promote your school, develop an effective website and social media presence, and do the numerous other management tasks required outside of the classroom. Of course, this means slower growth and less potential for maximum growth due to limited resources.
If you are hoping to have numerous teachers at multiple locations in the future, then your initial planning will be much different. My school started with a team of three people: a full-time native teacher with previous teaching experience, a full-time native teacher with graphic/web design experience, and a part-time Japanese manager with experience in eikaiwa management. This was effective for many reasons: between the three of us, we could tackle all the challenging tasks that are required when staring a business.
In addition, our expenses were low because the other full time teacher and I were willing to work for reduced salaries (investing sweat labor), and the part-time manager only worked as needed.
Of course, every situation will be different, but finding a team that is motivated with a diverse skill set is crucial to any new business.
One of the most important things that will help your business get off to a good start is getting your name out in the community and making your company visible to the public and potential customers. This is the main reason all companies spend such a large budget on advertising. Having a well-designed website, a strong social media presence, and effective advertising campaigns are necessary to be competitive with other language schools in your area. These can take a lot of time and money however.
There are other effective ways to reach out and become known in your community that don’t require as much money. New eikaiwas should think about how to give back to the community before thinking about how to receive from the community. Activities such as volunteering at English events (speech contests, summer camps, holiday parties) are a great way to show off your brand.
With a little more planning and networking, you can even set up your own events. Try starting an English movie night, potluck picnic, or a day trip to a famous location in your area. Any kind of event that is free or cheap for participants will be an effective method of advertising and also build a good “buzz” about your business through word of mouth advertising.
Recently, our city and prefecture have become a popular destination for tourism and art. So, we decided to design and print an English guide poster on how to eat the local cuisine, Sanuki udon. This was a free service we offered which cost us a couple hundred dollars for design and advertising. It was much cheaper than advertising in a local magazine or newspaper, and the feedback was excellent. Hundreds of local shops agreed to put our poster up for free, we were interviewed by numerous newspapers, and the poster and our school were even featured on some TV shows.
This just goes to show if you do something for your community, it could payoff tenfold. Look for those opportunities to show your individuality and your strengths as an English school and promote your brand.
4. Use a Strong Curriculum That Meets Your Students’ Needs
Every English school needs a solid English curriculum, but what kind of curriculum is best for your English school? First, you should think about your students and their needs as ESL students. Are you going to focus primarily on kids or adults? Will you have group lessons or private lessons? If you try to do everything from the beginning, you might sacrifice quality, so it’s good to choose a specific target you are confident in doing. Once you have a solid foundation of students and classes with a steady source of income then you can slowly start branching out and offering new products or services.
If you want to save time and use an effective 10-year curriculum that’s used by over 40,000 educators and instructors around the world, then you should consider the BINGOBONGO English Curriculum. It’s a powerful resource for teaching because it can be used both in your classroom lessons and online lessons.
This curriculum not only teaches reading, writing, speaking, and listening, but it also helps children develop valuable problem-solving skills. And when using the ABC FUN!box, our Online Teaching Platform and Resource Delivery System, you’ll be able to quickly access thousands of worksheets, flashcards, interactive games, songs, and more to build fun and effective ESL lesson plans in minutes. To save even more time, language schools in Japan can use our series of ESL coursebooks called FUN!books which are hugely popular with kids.
To see what kind of fun chants and videos are included in the curriculum, you can head over to our YouTube channel with lots of great videos.
5. Set Up Monthly Automatic Bank Withdrawal Payments
The last point of this guide to starting your own language school (eikaiwa) is often overlooked, yet a crucial point. As a business owner and manager, you will be busy with numerous tasks including teaching, scheduling, book keeping, advertising, and more. The more time you can save in daily tasks, the more time you will have to take on new challenges and promote your school.
Setting up automatic bank payments for students that pay a monthly fee will save a significant amount of time. Our school started automatic payments after about six months, and it was the single biggest time saver and headache eliminator. The stress of trying to chase down overdue payments and keep track of who has or hasn’t paid was instantly gone. Not to mention, it gives a sense of trust to your customers.
In Japan, many banks required having at least 100 transactions (customers) per month to set up an automatic withdrawal system, but the Yucho Post Office Bank Service is a little more flexible and we could start with around 30 or 40 customers. They charge 25 yen per student which is also reasonable. Depending on the country you start your English school, this may be easier or more difficult, but without a doubt, it was the best thing we could do to make management more efficient.