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Education Services Industry Resources

Educational Services- Sector Overview
This part gives you a quick overview of this industry sector, the number of businesses that comprise the sector broken down into large and small businesses along with a discussion about some issues and challenges facing the businesses.

Educational Services - List of Businesses
This section provides our readers with a listing of the businesses that are categorized under this industry classification.

Educational Services - Resource Directory
A great tool put together painstakingly by our staff that identifies the major associations and organizations that serve the various businesses in this industry classification.  Besides the name and website, you will also find a brief description about the organization.  Our small business owners always thank us for putting this tool together – we are confident that you will find it useful as well.

EDUCATIONAL SERVICES – SECTOR OVERVIEW

The first step in determining how to write a business plan at Trident Consultants involves identifying the correct business sector to which our client’s business belongs.  The educational services sector is a vast industry classification as per the NAICS – North American Industry Classification System.  It covers businesses like elementary and secondary schools, junior colleges, professional schools, business schools, secretarial schools, computer training, professional management, technical and trade schools, flight training, fine arts schools, sports instructions, language schools, exam preparation and tutoring and many others.  (A detailed listing of educational service businesses has been included at the end of this page.)

There are over a 152k larger businesses (with employees) in this industry sector that employ over 2.8 million people with a total payroll of $82 billion.  On average the larger educational services firms have at least 19 employees and the average income nationally for each of these employees is about $28k.

In the small business world covering firms with no employees, there are 454k such educational services firms with total gross receipts of $6 billion and the average annual income as reported by each firm of around $13k.

A business plan for any firm in the educational services business has to address the increasing cost of education year after year.  Indeed after health care costs, the costs of getting an education have shown the next highest increasing growing at roughly 5% to 6% every year.  The cost of a college education as well does not seem to stop escalating irrespective of the economic environment. 

Specialty schools like technical and trade schools often get patronage and grants from local governments and the thus the health of the local government can affect the ability of these institutions to raise the capital they need to be viable.  A business plan for any educational institution dependent on government grants must include a strategic plan for downsizing and running a leaner operation in the event of the local government body not being able to make its annual budget.

Educational services are very labor intensive and the largest cost they face in their budgets is the compensation of existing teachers and pension obligations of retired teachers.  Almost 60% of most school budget are spent on compensation and thus any sound business plan for an education service institution must carefully construct projections for the salaries and benefits of its staff.

Educational service firms also have to constantly spend on computer hardware and software so that they may offer their students the very best and latest to train with and also to stay competitive – while these costs are considered fluctuating and not fixed, it is really hard for an educational services firm not to upgrade their hardware every three years and their software almost every year – business planning must make sure that this is accounted for it the financial projections.

Uneven cash flow collections is yet another unique trait in the educational services business.  Weather the institution is s private school, computer training center or language school, tuitions are typically collected before the start of a semester but the institution has to face costs through the entire semester until the fees for the following semester come in.  This makes for wild swings in cash flows and a good business plan must make a recommendation for lines of credit and business loans so that these institution may be able to address their working capital needs during low cash flow intake periods.

If you are starting a business offering educational services, or are already established but are looking to grow, secure a partner, venture capital or business loans, we would be happy to help.

EDUCATIONAL SERVICES – LIST OF BUSINESSS:

 
The following is a list of the various businesses that fall under this industry sector:

Elementary and Secondary Schools
Junior Colleges
Colleges, Universities, and Professional Schools
Business and Secretarial Schools
Computer Training
Professional and Management Development Training
Technical and Trade Schools
Cosmetology and Barber Schools
Flight Training
Apprenticeship Training

Other Technical and Trade Schools
Other Schools and Instruction
Fine Arts Schools
Sports and Recreation Instruction
Language Schools

All Other Schools and Instruction
Exam Preparation and Tutoring
Automobile Driving Schools
All Other Miscellaneous Schools and Instruction
Educational Support Services