Break Even Analysis in case of Preschools

Break-even analysis is an important calculation used in business ventures like running a preschool. Break even analysis of a preschool is reached when its revenues equal the sum of all the expenses. At the break even point there is zero profit, but it also means that the business is no longer running losses and from here on it would begin to incur profits. A break-even calculation makes a lot of sense for the preschool owner because it helps to calculate the level of child enrolment that is necessary to avoid operating in a loss. However, break even breakdown is more of an indicator rather than a science of exact calculations.

For example, the childcare provider could choose not to add more children to reach the break-even point. Instead, the fee for new enrolments could be raised or the staff/child ratios could be altered. Thus, this analysis is indicative of how the preschool business set-up is operating in terms of finances and the changes it needs to make. Revenue projections can also go awry if there is a high rate of children dropping out of the preschool, right in between the semester. Preschools could solve this problem by making the parents sign a payment agreement. The agreement could be prepared in such a manner that the parents have to either give a two-week notice before taking out their child or pay one week of tuition fee in advance.

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Costs
In order to effectively control and budget the cost, expenditures, etc. the preschool management should have a good understanding of the various kinds of costs that are incurred when running the business. The break even analysis of a preschool factor in various kinds of costs likes,

• Fixed costs have a near-negligible tendency to change over a period of time. These costs do no undergo any kind of variation irrespective of the total number of teachers employed or the number of children enrolled. These include costs incurred in the form of land rent, insurance payments, etc.
• Variable costs tend to alter over a short or longer period of time. For example, costs incurred due to the money spent on food provided to the children would alter in proportion to the number of children enrolled.
• Step-variable costs are those costs that do change with a factor like the number of children enrolled but tend grow to a larger extent than the cost of preschooling calculated on a per child basis. A common example of a step-variable cost is teacher salaries.

Break even analysis of a preschool also need to factor in
• Average revenue per child.
• Margin created per child.
• Personal expenses debited from the preschool’s business account.

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Preparatory School for Children

Schooling has turned into a major business sector in India. Securing admission in a reputed senior secondary school is often linked to the quality and brand name of the preschool or playschool that the child had attended. Parents are often faced with preschools/playschools that advertise themselves as the ‘best preparatory school for children’. Many policy changes have been made regarding the admission process in the preschool sector but these guidelines are being openly flouted by the preschools that might market themselves as the ‘best preparatory school for children’.

Again, the interviewing of the parents in the senior secondary schools has also been abolished. This was to ensure that the blatant commercialisation of the preschooling sector in India was abolished. This is because often the interview process would grind the parents regarding the preschooling options they had made. Just to give an overview, with these policies in place, even parents seeking admission to the supposed ‘best preparatory school for children’ were often humiliated in terms of their qualifications and financial status.

Interested to Open a School? Call +91-9555433433


However, there are some worthy play schools that are truly preparatory schools and have positioned themselves as a means to bridge the gap before leaping into an environment for senior secondary or formal education. Some people have suggested that a ‘play school’ is actually a misnomer as the curriculum of preschools isn’t about random playing and is based upon certain theme-based, purposeful interactive sessions that endeavour to ensure a child’s holistic development.

Play Schools – the urban connection
Play schools are just entering the semi-urban areas or industrial towns. Presently, there are largely looked upon as an urban need — an urban phenomenon. This is largely due to the fact that the disposable incomes are higher in the cities and the number of nuclear families is increasing by the moment. Again the concept of working parents translates into greater need for preschools/playschools.

Forays have been made into the non-urban centres and an example of it is the SHEMROCK Group of Schools. They have introduced playschool-based centers in many small towns and sub-urban areas. Such play-schools aren’t a mirror image of their metropolitan counterparts but they strive hard to fulfill the purpose of structured preschooling . There have been some attitudinal changes that have led to a growing demand for play schools. The debate regarding a play school’s purpose is increasingly fading away.

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Preschool Brochures: Need & Impact

In terms of a definition, a brochure is basically a leaflet/booklet/pamphlet/piece of printed paper that is used for the purpose of promoting a product, brand name or services. Brochures for preschools are generally used for advertising activities and preschools have been using them since their very inception. The design of a typical preschool brochure should be attention-grabbing and usually brochures for preschools are infused with a lot of creativity and an array of different colours.

Advantages of Having Brochures for Preschools
For any successful marketing campaign it is vital that the logo should be very impactful and should induce a feeling of association and reliability with the people. If the logo is seen often, then the marketing campaign has been successful in making the people familiar a particular brand. This holds true for preschools also. One of the easiest ways to make people familiar with the logo of a preschool is by getting them printed on brochures for preschools. Brochures for preschools usually carry the preschool’s logo, making the audience feel that the brand is professional and financially successful.

Impact of Brochures for Preschools
Most brochures for preschools have smiling and happy children in a very expressional manner. These brochures use glossy photographs that have preschool teachers intermingling with the students and are littered with pictures of activities that are conducted by the preschool like the field-trips or picnics or stage performances of the students. Such brochures enhance the preschool’s image as having the suitable kind of environment to enable the holistic development of a child.

This helps in engaging the parent’s attention and in making sure that more people approach the preschool for admission. Hence, brochures for preschools also aid in more admission and bigger profits. Brochures for preschools are circulated among the neighbouring household and sometimes also in business places that are likely to see a large footfall of young children. For example, fast food chains. An impressive preschool brochure is a combined effort of the graphic designers, school’s staff, administrators and sometimes the feedback of parents.

Understanding the Role of Brochures of Preschools
The importance of brochures for preschools can be best understood with a simple example. Let us suppose a parent is seeking admission for his 3-year-old son in a preschool that is trustworthy but doesn’t have sufficient information regarding the neighbourhood preschools. The parent starts to seek the opinions of family, friends and office colleagues but is still confused. Now, he sees a preschool brochure. The brochure looks very attractive and the layout is beautiful. It addresses the preschool education from the child’s/parent’s viewpoint. The brochure contains a lot of photographs that highlights the preschool’s facilities/activities. Just a look at the brochure, impresses the parent so much that he immediately makes an enquiry about admissions to that preschool and is eventually persuaded by that school’s counselling staff to get his son admitted.

Tackling Violence in Schools

From corporal punishment and sexual abuse to verbal and emotional abuse, violence in schools is becoming common in India and in order to resolve this issue, Plan India — a developmental organisation for child rights launched a campaign called — “Learn without fear”, in New Delhi.

It has been established that nearly 69% children report physical abuse, including cases of corporal punishment. Out of the reported cases, two out of three children complained about corporal punishment. Maximum percentage of corporal punishment was found in government and municipal schools. Other forms of violence among children included sexual abuse. The worst offending states include AP, Assam, Bihar and Delhi. Corporal punishments in schools have been handed out for numerous ‘reasons’ like dirty uniform, homework, late comings, late fee, etc. The nature of ‘punishment’ has been found to include making children stand in the sun, do repeated sit-ups and merciless beatings. Violence could be both physical and mental. Children humiliated in a class could turn violent on fellow classmates.

Most educators said that increasing academic competition and parental pressure was over-taxing students and making them angry. Some counsellors suggested that acceptance and supporting the child without being threatening or violent was essential to resolve childhood insecurities. They laid emphasis upon increasing communication with the children and more parent-teacher interaction platforms. Teacher training in understanding student behaviour was also stressed upon.

Innovative Teaching To The Fore

The one week-long DPS Principal’s Conference held in Gandhinagar ended on November 28th 2008 and one aspect of the discussion that found favour with everyone was regarding the use of innovative and futuristic teaching methods in order to make the learning process more engaging and sustainable. The conference saw 32 DPS principals participate and communicate their individual experiences. Nearly every educationist in attendance agreed that more sincere efforts were needed to teach young minds through making education/learning more realistic by using the tools of observation and self-exploration.  

The conference was also attended by some management gurus like IIM-A professor, Anil Gupta. Mr. Gupta went on to present his definition of a good teacher. According to him, the best teachers were those who interacted with the maximum number of children outside the classroom. The chief guest was Dr. Sasi Misra, Professor, Entrepreneurship Development Institute of India (EDI). He was of the opinion that education in India was overpriced and the pricing of educational services ought to be in compliance with values imparted to a child.

Education as Right to cost Rs. 12000 a year

The government has slated to introduce the long awaited Right to Education Bill in Parliament in December. The Bill ensures fundamental right for children aged 6 to 12.
While stating that both the Centre and states would be responsible for the finances, it said the Centre would prepare the capital and recurring expenditure and provide it as grants-in-aid to each state from time to time. The GoM also decided to consult the finance commission for additional resources. However, the share between the Centre and states is yet to be decided.
To cost the exchequer early Rs 12,000 crore every year, even private unaided schools would not be out of its ambit since 25% of seats would have to be reserved for poor children in the neighbourhood. On its part, the Centre would be reimbursing the cost of these schools.
The legislation has a host of features that stress not only on reaching out to every child in the age group 6 to 14 but also on quality and accountability of the state and education system. Sources said the legislation is aimed at dealing with criticism that state-run schools lag behind in quality. To ensure that the law gets effectively implemented, the Bill has provisions prohibiting teachers from undertaking private tuitions as well as not letting them being used for non-educational purpose.
To ensure that parents have equal stake in the system, the Bill provides for School Management Committees in all government and aided schools. Each committee would monitor and oversee the working of the school, manage its assets and ensure quality. There is also a provision that teacher vacancy should never exceed more than 10% of the total strength.
To monitor the implementation of the law, the Bill purposes a National Commission for Elementary Education to be headed by a chairperson. He would be appointed by a committee consisting of the PM, leaders of opposition in both Houses of Parliament, HRD minister and the Lok Sabha Speaker.

Education as Right to cost Rs. 12000 a year

Article courtesy: Times of India, 1st Nov ’08

Preparatory School Education in India

Schooling has turned into a major business sector in India. Securing admission in a reputed senior secondary school is often linked to the quality and brand name of the preschool or playschool that he child had attended. Parents are often faced with preschools/playschools that advertise themselves as the ‘best preparatory school for children’. Many policy changes have been made regarding the admission process in the preschool sector but these guidelines are being openly flouted by the preschools that might market themselves as the ‘best preparatory school for children’.

Again, the interviewing of the parents in the senior secondary schools has also been abolished. This was to ensure that the blatant commercialisation of the preschooling sector in India was abolished. This is because often the interview process would grind the parents regarding the preschooling options they had made. Just to give an overview, with these policies in place, even parents seeking admission to the supposed ‘best preparatory school for children’ were often humiliated in terms of their qualifications and financial status.

Interested to Open a School? Call +91-9555433433


However, there are some worthy play schools that are truly preparatory schools and have positioned themselves as a means to bridge the gap before leaping into an environment for senior secondary or formal education. Some people have suggested that a ‘play school’ is actually a misnomer as the curriculum of preschools isn’t about random playing and is based upon certain theme-based, purposeful interactive sessions that endeavour to ensure a child’s holistic development.

Play Schools – the urban connection
Play schools are just entering the semi-urban areas or industrial towns. Presently, there are largely looked upon as an urban need — an urban phenomenon. This is largely due to the fact that the disposable incomes are higher in the cities and the number of nuclear families is increasing by the moment. Again the concept of working parents translates into greater need for preschools/playschools.

Forays have been made into the non-urban centres like Zee Interactive Learning Systems. They have introduced a playschool-based theme called the ‘Grameen’ model in smaller towns. Such a playschool might not be able to boast as being the best preparatory school for children but certainly fulfils the purpose in its own way. There have been some attitudinal changes that have led to a growing demand for play schools. The debate regarding a play school’s purpose is increasingly fading away.

Chat on Whatsapp +91-9650193838 for more Details

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Preschool Brands in India

A branded preschool in India isn’t uncommon these days. Most urban and semi-urban centres boast of a number of branches of branded preschools. Pre schooling has evolved into a professionally managed sector with rising investments and vast opportunities for expansion through franchises being offered. Some people tend to confuse Day-care centres and preschools. Although a preschool also serves the purpose of being a day-care centre, it is a bit different in its approach. A branded preschool in India is associated with being a licensed and accredited educational establishment that boasts of a planned and structured academic and recreational environment within a professionally-developed curriculum.

Interested to Open a School? Call +91-9555433433


Better than Day-care
Preschools offer more age-appropriate type of activities as they function beyond the realm of merely keeping the child engaged unlike a day-care centre. A branded preschool in India is now being marketed as a stepping stone towards formal education. In India, senior secondary education is very serious and preschools which promise to provide a foundation for further learning also assume a great deal of importance. The academic aspect of branded preschools in India is much more than that of global preschools and is feature unique to the Indian system of preschooling.

Varying Curriculum
Some branded preschool in India might still be following the Montessori system of education. Some more prestigious and reputed preschools have gone beyond the realm of Montessori-based curriculum. A branded preschool in India might advertise itself as the best in the business as most of the leading brands have a good reputation. However, in this age of slick advertising, such advertisement-based campaigns might just be an eyewash and may be only highlighting the better aspects associated with a particular brand of preschool. This is why it becomes critical to check out the certifications and accreditations of a preschool rather than just depend upon its reputation.

Any branded preschool in India is basically a privately-funded venture. Most these schools are based on the franchise format. One glaring aspect that becomes apparent is the lack of central controlling body or organisation that regulates and oversees the operation of these preschools. Most of these preschools have the freedom to decide every aspect of their function independently, including the monthly fees, preschooling hours, schedule of vacations, childhood philosophies and the methods of discipline used within the classroom.

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Buy a Franchise

For potential investors and businessmen, the education franchising sector offers immense growth opportunities. However, once a decision to buy a franchise has been made, the potential franchisee needs to clarify some points necessary to become a successful franchisee.

How Franchising Works?
In order to become a profitable franchisee, it is better to have a grasp over the basic franchise concepts. To buy a franchise may appear like a simple task to accomplish, but it isn’t that straightforward. There are many different franchising formats. For example, an investor has to decide which franchise format would be easier to manage and more profitable. There is a choice between manufacturing and business-format franchise. Some people are content with selling a brand, i.e. brand franchising.

Interested to Open a School? Call +91-9555433433

A potential investor should know about:
•    Franchisee-franchisor relationship
•    Limitations in a franchise set-up

How to Buy a Franchise?
The most important evaluation has to be about an investor’s individual financial status. Other important aspects of planning to buy a franchise include:

•    Financing options — these options could be provided by the franchisor himself. Usually, once an investor is related to a particular brand, it becomes easier to avail finances from banks and credit institutions.

•    Franchise agreement — this is the defining document and the very sole of the franchise-franchisee relation. The agreement incorporates everything from the franchise fee to the extent of a franchisee’s rights.

•    Franchise consultants — some people are confused about how to buy a franchise. Such potential investors could seek the help of a professional like a franchise consultant.

Buy a franchise or franchisee?
Some people prefer to buy a franchise opportunity directly from the franchisor and establish their own business, i.e. a new business set-up. This offers the opportunity to start fresh with your own space and infrastructure. On the other hand, there are investors who seek to buy a franchise that is already in operation. The investor benefits from a business format and infrastructure that has already been created and is actually in operation but to buy a franchise in the form of an existing franchisee has greater risks attached to it. A franchisee-owner selling his business has to explain the reasons for such a sale and his financial liabilities.

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Playschools in India

Schooling has turned into a major business sector in India. Securing admission in a reputed senior secondary school is often linked to the quality and brand name of the preschool or playschool that he child had attended. Parents are often faced with preschools/playschools that advertise themselves as the ‘best preparatory school for children’. Many policy changes have been made regarding the admission process in the preschool sector but these guidelines are being openly flouted by the preschools that might market themselves as the ‘best preparatory school for children’.

Again, the interviewing of the parents in the senior secondary schools has also been abolished. This was to ensure that the blatant commercialisation of the preschooling sector in India was abolished. This is because often the interview process would grind the parents regarding the preschooling options they had made. Just to give an overview, with these policies in place, even parents seeking admission to the supposed ‘best preparatory school for children’ were often humiliated in terms of their qualifications and financial status.

Interested to Open a School? Call +91-9555433433


However, there are some worthy play schools that are truly preparatory schools and have positioned themselves as a means to bridge the gap before leaping into an environment for senior secondary or formal education. Some people have suggested that a ‘play school’ is actually a misnomer as the curriculum of preschools isn’t about random playing and is based upon certain theme-based, purposeful interactive sessions that endeavour to ensure a child’s holistic development.

Play Schools – the urban connection

Play schools are just entering the semi-urban areas or industrial towns. Presently, there are largely looked upon as an urban need — an urban phenomenon. This is largely due to the fact that the disposable incomes are higher in the cities and the number of nuclear families is increasing by the moment. Again the concept of working parents translates into greater need for preschools/playschools.

Forays have been made into the non-urban centres like Zee Interactive Learning Systems. They have introduced a playschool-based theme called the ‘Grameen’ model in smaller towns. Such a playschool might not be able to boast as being the best preparatory school for children but certainly fulfils the purpose in its own way. There have been some attitudinal changes that have led to a growing demand for play schools. The debate regarding a play school’s purpose is increasingly fading away.

Chat on Whatsapp +91-9650193838 for more Details

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