If you’re looking to launch a profitable side hustle, starting a tutoring business is a fantastic option to consider.
Not only are parents looking for qualified individuals to support their kids in improving academic weaknesses, a significant segment seek private tutors for various other services such as homework help, college entrance exam preparation, and second language development, just to name a few.
And tutoring school-aged children isn’t the only option.
There are plenty of adults (think college students, second language learners, etc.) who desire to improve in some area and need guidance in doing so.
This post shows you step-by-step how to start a lucrative tutoring business.
How to Launch a Tutoring Business
1. Set Your Income Target.
First things first…
Think about your desired income target.
How much money do you want to make your first year?
Setting income goals guides the actionable steps you must take week by week and month by month to reach your income goals.
If your desired income goal your first year of starting your tutoring business is to make an extra $25,000, then break that number down and see how much you would need to earn each week in order to make that happen.
The more revenue you plan to make per month, the more aggressive you’ll be with your marketing tactics which are covered further down in this post.
2. Estimate Potential Expenses.
A huge positive to starting a tutoring business is the low start-up costs.
You’ll most likely tutor at the client’s residence, your home, or in some cases, the child’s school.
If you plan to go to the client’s home or school, account for gas expenses.
A positive to going to clients’ residence is that you’re able to charge more per hour for your tutoring services.
The other main expenses you’ll have when starting your tutoring business include study resources and promotional materials for marketing purposes.
3. Research a Suitable Niche.
Finding a suitable niche means knowing your market.
If you want to be able to scale your tutoring business (code: potential to earn greater profits), you’ve got to identify market niches where demand exceeds supply and/or where the demand is willing to pay.
Here are some suggestions:
- Look up tutoring businesses in your area. See for which subjects they offer services and at what price points. You can do most of this online. If a company or individual (focus more on those businesses that are similar to what you envision for yourself) charges a certain amount, you know that you too can charge comparable rates, all other things being equal.
- Niche down. If your target audience is elementary-aged students and businesses in your area charge considerably less for tutoring that age group, niche down. By this I mean, make yourself more marketable by specializing. For example, you could market yourself as a specialist in math intervention or reading intervention. Or bilingual education, special ed., etc.
- Research tutoring businesses in higher-income areas. You’ll ideally want to focus on this customer segment since they’re more likely to pay your higher fees.
- For those wanting to tutor high school or college students, you have a greater advantage. Because the perception is that high school and college subjects are harder to master, parents generally spend more money on those services, without much hesitation.
4. Reflect On Your Talents and Strengths.
Though starting a tutoring business doesn’t require any highly- specialized skills, you do need to examine how well your talents and strengths align with the niches you’d like to target.
Maybe you don’t consider yourself an expert in ACT prep, but if that’s your targeted niche, do you have what it takes to learn the structure of the exam and all of its content?
Will you confidently be able to teach those skills and strategies?
If you’re targeting elementary-aged kids, you may feel okay with the content, but are you comfortable working with this age group?
So consider your comforts and preferences.
5. Price Your Services.
What you charge for your tutoring services depends on many factors: location, demand, experience, reputation, niche, and the list could go on.
Assuming you’ve done your market/niche research and know what comparable businesses charge for your niche, here’s my take on pricing….
Charge your worth!
It may take some time to get there, but start relatively high as many people correlate quality with price point.
NOTE: Test out this tutoring pricing guide to help you figure out what to charge for tutoring elementary students.
Differentiate yourself with the value you provide … what are you doing differently?
Sometimes the biggest difference is in the relationships you form and cultivate with your clients.
Additionally, you can charge more for tutoring during “off” times such as weekends and holidays.
And remember, package-pricing with a built-in discount (when clients pay for weeks at a time) is a better value overall for you and the client.
6. Draft a Tutoring Policy Contract.
Drafting a tutoring policy is a very necessary part of starting your business because well…people are human and may not always act in your best interest.
A tutoring policy contract creates boundaries and outlines professional ethics.
It’s presented and agreed to by the client before any services take place.
Draft a decent tutoring policy, and most importantly, stick with it.
Not following through or showing leniency with certain clients isn’t in the best interest of your business.
Following are a few topics you may want to cover in your tutoring business policy:
- Missed sessions
- Group tutoring (rates and person limits)
- Payment due dates
- Late payment policy
The list goes on.
I cannot stress enough the importance of having a tutoring policy contract.
It will save you money, time, headache, disputes, and miscommunication.
7. Build Your Tutoring Framework.
Think about the materials you might use to tutor clients, and consider using similar materials with all learners to keep things streamlined and consistent.
Of course, you can modify things here and there, but a comprehensive study guide is a practical idea.
With elementary students, you want to choose materials that are standards-based (according to the school’s curriculum), and highly student-centered.
8. Market Your Tutoring Business.
Now it’s time to get the word out about your tutoring business!
Strategic marketing is arguably the most important step of growing your tutoring business.
The easiest way to begin marketing is by word-of-mouth and leveraging your existing network.
Make connections with local schools, relevant organizations, and libraries in your targeted areas.
And consider online marketing as it’s a great way to grow a client base organically.
The simplest way to begin with online marketing is through social media: LinkedIn (great for the tutoring niche) YouTube, and Facebook.
Consistently provide value to your potential audience via these mediums. The more content you publish, the more potential leads you’ll gain.
9. Invest in Your Business and Yourself.
If you’re in the tutoring business for the long-run, consider the following options…
- Formalize your business with an LLC or other business entity appropriate for your business situation. Talk to your tax professional to see what option is the best fit for your business model.
- If you have other sources of income, use a separate bank account for your tutoring business transactions.
- Have a system for handling your tutoring business transactions.
- Congregate with like-minded individuals. Connect with others growing small businesses. Not only do you learn new strategies and marketing techniques, you network with others in your community.
Wrapping Up: How to Start a Tutoring Business
Knowing how to start a tutoring business that will be successful isn’t a piece of cake, but it’s an attainable goal for those with the right mindset, determination, and a strategic plan.
Following the above actionable steps, you’ll be on your way to growing a profitable tutoring business in no time.
All the best in your business ventures