Market Research & Feasibility Study, including Business Plan

A Market Research & Feasibility Study, including a financial model and business plan, is one of the first and most essential steps in setting up a new school. Making assumptions can be expensive, and decisions that don’t match the research could be made. They can be made on a hunch or a wild dream; therefore, a comprehensive study will minimise risk and maximise your chances of success. Even if it is clear that the school will advance, this research will influence many decisions in the set-up process.

Our studies range from “back-of-the-envelope” estimates to comprehensive reports of 200-250 pages used by private equity and investment groups. Branches of ” the big five” accounting firms and some of the world’s largest education groups and investors regularly consult with us. Whatever your needs, it is crucial to research and plan carefully.

The following represents some, certainly not all, of what needs to be in a Market Research & Feasibility Study and the creation of a comprehensive business plan:

Vision and Mission – “The Voice”

At first glance, a school’s vision and mission statements may be simply generic phrases put together by the marketing team. However, these statements are far more than words on a feature wall—the cornerstone of the school’s identity and strategic direction. They play a critical role in the Market Research and Feasibility Study process. At GSE, we emphasize the importance of developing a school’s unique “voice” during this phase. It is a business plan with heart and passion.

This voice encapsulates the school’s core values, aspirations, and character. It must be clear, consistent, and recognizable in every aspect of the school’s operations—from the architectural design to the curriculum and even the type of staff recruited. Every decision made should resonate with this voice, as it forms the foundation of the school’s long-term vision.

Now, imagine fast-forwarding 20 years into the future. Alumni return to share stories about their experiences, and the question arises: How will they describe the school? What stood out? This reflection is where the true impact of the vision and mission becomes evident. These graduates will remember more than just their academic achievements; they’ll recall what made their school special, how it shaped them, and why it stood apart from other institutions.

Ultimately, the school’s voice is about setting it apart in the short term and creating a lasting legacy that inspires future generations.

The Market

Understanding the market where a new school will be launched is critical to its success and a core component of any feasibility study. Often, decisions are made based on assumptions or personal beliefs about what parents value rather than on clear, evidence-based insights. At GSE, we emphasize analyzing market demands through a structured, data-driven approach. Our process focuses on three key market segments, allowing us to identify the greatest demand and align the business plan to meet those needs.

We believe that there is a school model suitable for every context, but achieving this requires balancing vision with practicality. Too often, idealistic dreams can overshadow a strong, well-thought-out strategic plan. It’s essential to ground ambitions in reality and ensure that the school aligns with the actual needs and expectations of the community it will serve.

Cultural factors also play a significant role in shaping the education market. What parents want and need can vary widely depending on local traditions, social norms, and economic conditions. Market and economic forces, combined with the practical logistics of implementing different curricula, must be carefully considered in the planning process.

By considering all these factors—parental expectations, market realities, cultural dynamics, and curriculum logistics—we create school models that are aspirational but also viable and sustainable within their unique market environments.

Staffing/Recruitment

Staffing and recruitment are critical components that must align closely with your financial plan. One key consideration is determining the appropriate staff-to-student ratios both in terms of teaching staff and support or administrative personnel. These ratios must be calculated with precision, keeping in mind that as the school grows, operational efficiency typically increases, allowing for more cost-effective staffing solutions over time.

Recruitment methods vary widely in terms of cost and effectiveness. It’s important to recognise that, in this case, you truly get what you pay for. High-quality teachers and staff are integral to a school’s success, but attracting the best talent comes with a price. To balance costs and quality, you’ll need to explore a range of recruitment strategies, from traditional advertising and job boards to specialized recruitment agencies.

As a new school, it’s important to remember that you’re marketing to potential students, families, and prospective staff. Building a strong reputation from the outset is crucial. A well-designed and informative website can be a powerful tool for attracting high-calibre professionals. Ensure that your website and digital presence highlight the school’s vision, unique attributes, and growth potential, making it appealing to educators looking to join an innovative and forward-thinking institution.

Investing in marketing to potential staff members is as important as student recruitment. After all, a school’s success largely depends on the quality of its educators and support team, so positioning yourself as an attractive employer is essential.

Financial Planning

For non-profit and for-profit schools, developing a comprehensive business plan with a well-rounded financial strategy is essential for ensuring sustainability and long-term success. At GSE, our Market Research and Feasibility Study integrates into a robust 10-year financial plan. This plan is designed to project key milestones, such as the break-even point, the first year of profitability, and the school’s anticipated position after a decade, ensuring the institution achieves a stable and healthy financial footing.

Here are key considerations for this plan:

Financing & Growth Strategy

Determining how the school will be financed, whether through private investment, loans, grants, or philanthropic contributions, is crucial. The growth strategy should outline how funds will be raised and allocated to ensure the school can scale effectively. Will the school expand in phases, or is there an opportunity for immediate growth through a larger upfront investment? The strategy should also address future financial inflows, such as increased enrollment, and how these can fund further development.

Capital Requirements

Identifying the capital required for the school’s initial setup and ongoing expansion is a critical step. This includes construction or renovation of facilities, purchase of equipment and materials, and investment in technology infrastructure. A clear understanding of capital requirements will prevent underfunding and ensure all essential elements are in place before opening.

Financial Strategy

A sound financial strategy is the backbone of any school business plan. This includes balancing the need for initial capital outlay with sustainable financial growth. You’ll need to decide how revenue will be generated (tuition fees, special programs, donations) and how the funds will be distributed to cover fixed and variable costs, such as salaries, operational expenses, and ongoing facility maintenance.

Risk Analysis

No financial plan is complete without a thorough risk analysis. This involves identifying potential risks—such as enrollment shortfalls, economic downturns, or unexpected costs—and creating contingency plans to mitigate them. A well-rounded risk analysis ensures the school can weather financial storms and maintain its operational viability.

Financial Plan

The financial plan should cover everything from startup costs to long-term financial projections. It will need to account for fixed and variable costs over time, such as staff salaries, utilities, and maintenance. A key goal is ensuring the school is cash-flow positive after an initial period of investment. A detailed financial plan will allow for better decision-making when scaling or modifying services.

10-Year Budget Plan & Revenue Model

A detailed 10-year budget plan should be created to map out expected revenues and expenditures. The revenue model will depend on factors like tuition pricing, projected enrollment, and potential alternative revenue streams (such as partnerships or government funding). Forecasting revenue and expenses over this period makes it easier to pinpoint when the school will break even and start generating a surplus.

Expense Assumptions

Expense assumptions include both one-time and recurring costs, such as construction, staff recruitment, operational costs, and marketing. It’s essential to be conservative in your estimations to account for unforeseen costs, ensuring that your financial projections are realistic and achievable.

Income & Expense Estimates

Finally, accurate estimates for income and expenses should be continually updated to reflect actual financial performance. These estimates must factor in potential changes in enrollment, staffing needs, inflation, and any other variables that might impact the school’s financial health. Regularly reviewing and adjusting these estimates will ensure the financial strategy remains aligned with the school’s evolving needs.

Addressing these key elements will allow the school to maintain a strong financial position, which will support its educational mission and long-term growth objectives.

Competitive Analysis

A well-executed Competitive Analysis is essential for understanding your market landscape and identifying opportunities for differentiation. By analyzing competitors, we can pinpoint gaps in the market, uncover what similar schools are excelling at, and recognise where they fall short. This analysis generates both quantitative and qualitative data, providing a robust foundation to guide strategic business decisions.

Here’s how a Competitive Analysis can benefit your school’s planning process:

1. Develop and Validate Unique Selling Points (USPs)
   A thorough analysis helps to confirm or refine your school’s Unique Selling Points. By identifying what makes competitors successful, you can sharpen your own differentiators, ensuring that they are not unique but also relevant to what parents and students are looking for in a school.
2. Address Competitors’ Strengths
   Recognising and understanding the aspects parents value in competitor schools is crucial. This ensures that your school not only stands out in its own way but also competes effectively by incorporating elements proven to attract families, such as strong academic programs, extracurricular activities, or superior facilities.
3. Capitalize on Competitors’ Weaknesses
   Identifying common complaints or dissatisfaction from parents at competing schools presents an opportunity. You can position your school as the solution to these issues, whether it’s through improved communication, better teacher-student ratios, more diverse programs, or a more inclusive community.
4. Benchmarking for Future Growth
   You can establish benchmarks to measure your growth by comparing your school to competitors. Metrics such as student enrollment, academic outcomes, facilities, and student satisfaction can be tracked over time, giving you tangible goals to strive for and areas for improvement.
5. Identify Underserved Market Segments
   Competitive analysis often uncovers underserved market segments—groups of students or parents whose needs aren’t fully met by existing schools. By identifying these segments, your school can fill these gaps, whether it’s through specialized programs (such as STEM, arts, or CTE programs), tailored support for students with learning differences, or flexible learning models like online or hybrid classes.

At GSE, we typically compare around 10 schools when conducting a competitive analysis, although this number varies depending on the context. For instance, more schools would need to be analysed in a highly saturated market like Kuala Lumpur to get a complete picture. However, comparable schools may be lower in developing countries with fewer educational institutions, such as Myanmar or Cambodia, small African countries, or the emerging regions of Eastern Europe. The goal is to ensure the analysis is thorough and context-specific, providing actionable insights regardless of the market environment.

By leveraging the insights from a comprehensive competitive analysis, you can position your school strategically to address market demands, enhance its appeal, and ultimately secure a strong foothold in the educational landscape.

So what should be measured? There are obvious aspects such as price, curriculum, percentage of local vs. foreign teachers, social media channels, and even reviews from parents, and many more points that you can find here!

Many other steps are involved in setting up a school, and our approach to Market Research and Feasibility Studies is just the first important but relatively small step. Contact us directly for a video conference to learn even more about how GSE tailors a plan to the needs of the owner and the market.

What is a GSE Feasibility Study, Business Plan and Report Like?

At GSE, our Feasibility Study and Report is comprehensive, and represents data-driven documents that cater to a wide range of investors, from small individual investors to private equity firms and family offices. These reports thoroughly analyse the market, competition, financial projections, and operational considerations to guide strategic decision-making when establishing or expanding schools.

Key Characteristics of a GSE Feasibility Study and Reports:

1. Extensive and Detailed Reports
   Our reports range from 50 to 250 pages, depending on the scope of the project and the client’s needs. These professional documents are tailored to be valuable tools for investors, whether they are planning a small, niche school or large-scale educational venture. Each report is built to provide a complete picture of the market potential, financial viability, and strategic roadmap for new school projects.
2. Clients Include Industry Leaders
   GSE has worked with some of the largest and most respected names in education investment. Global investors, education brands, and leaders in the international school space have commissioned our Feasibility Studies and Financial Modelling. This diverse experience ensures that our reports are comprehensive and trusted by key players in the education investment sector.
3. Industry-Leading Financial Models
   GSE’s financial models are considered the best in the industry. With over a decade of experience operating schools and understanding the unique investment needs of the education business, we offer practical and forward-thinking financial insights. Our models include detailed projections on startup costs, operational expenses, revenue, and profitability over 10 years, helping investors make informed, strategic decisions.
4. Trusted by Global Investment Leaders
   Our financial models and strategic advice have earned the trust of global leaders in education investment. Whether it’s a private equity firm or a family office, our clients rely on our deep understanding of the education sector’s financial dynamics. We focus on delivering tailored, actionable insights that align with the goals and risk tolerance of each investor.

Content of a GSE Feasibility Study:

• Market Research & Competitive Analysis
  An in-depth analysis of the target market, including demographic trends, local and international competition, and gaps in the market that present opportunities for differentiation.
• Financial Modelling
  A 10-year financial projection includes break-even analysis, cash flow projections, revenue models, and detailed estimates of startup costs, operational expenses, and capital investment requirements.
• Risk Analysis & Mitigation Strategies
  Identification of potential risks—such as market saturation, economic fluctuations, and operational challenges—and strategies to mitigate those risks.
• Operational Planning
  Detailed recommendations for staffing, curriculum implementation, facility requirements, and marketing strategies ensure that the school is financially viable and operationally efficient from day one.

With GSE’s comprehensive Feasibility Studies and Reports, clients gain a detailed analysis and a strategic plan that sets them up for success in the competitive world of education investment.

Why did GSE first begin offering this invaluable Feasibility Study service?

For over a decade, some of the world’s largest investment groups have turned to GSE leaders for advice on market trends, data analysis, and strategic insights in the education sector. GSE has built a reputation as a trusted advisor to global investment leaders, providing deep knowledge of what is happening—and what is likely to happen next—in major global educational markets. Recognizing the value of this expertise, GSE decided to unlock this vault of information and offer it as a structured Feasibility Study service for school investors and operators.

GSE’s commitment to helping schools succeed is the driving force behind this service. We understand that success in education doesn’t happen by chance; it requires meticulous, evidence-based planning. By offering our Feasibility Study service, GSE provides more than just data. We bring to life the insights and trends in ways that empower schools to make strategic decisions that ensure their long-term viability.

GSE’s team of education experts goes beyond simply finding and presenting data. Our approach involves translating that data into meaningful conversations and actionable plans that directly contribute to the success of new schools. We take a holistic view, combining market research, financial modelling, and operational planning to create business plans with credible arguments that support a clear vision and mission.

Ultimately, strategic plans need the backing of industry experts. With our Feasibility Studies, GSE bridges the gap between raw data and practical, expert-driven insights essential for schools’ successful establishment and growth in today’s competitive education landscape.

GSE has extensive global experience:

39 schools – 12 Countries – 8 International Awards

Including India, China, Vietnam, Malaysia, Cambodia, Thailand, East Timor, Mongolia, Myanmar, South Korea, Saudi Arabia (KSA), UAE, Equatorial Guinea, Zambia, Kenya, Libya, Bahrain, Iraq, Japan, Indonesia, Australia, USA

GSE creates new school brands

GSE represents several very unique and famous school brands from the UK, Australia and the USA

GSE provides specialist services for setting up all educational institutions, including international schools, kindergartens, vocational colleges, universities, and online/virtual schools.

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• 10 Steps and Articles on How to Set Up a New School
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