As a busy school owner, you may not always have time to think ahead about the potential value of your school business. There may come a time in the future when you are ready to sell your business, and at that time, preparing to sell one of your most substantial assets at a premium marketplace value will allow you to turn years’ worth of hard work into spendable income.
The potential value of a school can be difficult to measure. Below, we suggest a few tangible ways to prepare your school business and related real estate now so that you can realize the greatest profit in the long haul. Whether you own one school or several, the following ideas will positively impact the value today and position your assets for a potential future sale.
Educate the Team
Take time to invest in your team. A well-educated staff of teachers and assistants speaks greatly to the care and education provided to the students. Make it a point to send teachers to continuing education classes, and have regular meetings with staff on policies and procedures to enhance their work environment and that of those in their care.
Avoid Deferred Maintenance
It goes without saying that continual maintenance is crucial for preserving your school business and ensuring it retains its value. Deferred maintenance is the attempt to cut costs by postponing or avoiding routine maintenance. This improper practice can lead to property deterioration and ultimately devalue your business and real estate.
It is crucial to regularly touch up paint, clean the carpets and floors, make sure the windows are sparkling clean, update the lighting, replace playground surfacing, and pressure wash equipment, roofs, and walkways.
Keeping up with the maintenance of your facility will not only increase the value of your school but will help create a lasting, first impression on current or new parents and potential buyers.
If you do not prepare monthly financials, start now! The only way to ensure present and long-term financial success in your business is to regularly evaluate revenue and expenses, and make adjustments as needed. Conducting monthly and year-over-year financial analyses that identify key line items such as labor costs and revenue are critical to running a profitable business.
Consider implementing an ACH tuition program. It is easy to administer, more cost-effective than credit card fees, and improves cash flow. If you are not depositing cash receipts, begin doing so today. If you have not increased tuition in the last year, establish a new tuition schedule by researching school tuition rates from similar education programs in the marketplace.
If you accept part-time students, are your part-time rates robust enough to cover the additional staff and resource costs needed? If you offer vacation credit or other discounts, evaluate your policies so that your annual costs are covered. Ensure your registration fees cover the costs needed to process new and potential students. By consistently evaluating your costs, you will be able to more accurately assess profit goals and current margins.
Getting the Most Out of Your School Business
Selling your school business can be a bittersweet experience as you prepare to say goodbye to something you have spent your life building. However, by working consistently on maintaining your school’s appearance, and understanding the school business financials, you will be able to maximize value for a potential sale. This will better position you for your next venture.[/column]