Education institutions run and close frequently. Parents are afraid to report to any class

 Education institutions run and close frequently. Parents are afraid to report to any class

Economic Observer: is your child still reporting vipkid? Do I think theres any risk in enrolling for another years course? On October 28, Liu Lina sent a text message to her cousin who works in an educational institution. After getting risk-free confirmation, she contacted the sales consultant who had been in contact with her before.

Liu Lina is not the first time to apply for classes for her children in the second grade. As early as school age, she has applied for many training courses for her daughter, such as early English teaching, painting, dancing, etc., but it is the first time for her to consider whether such training institutions will close down or not.

In the past, we used to think about the reputation and effect of training institutions, but now we think more about our own money. Even big organizations like Weber English have run away, so they are worried about what kind of training courses they are going to take now. . Liu Lina said anxiously.

The frequent events of closing business and running away in the education industry have caused the concern of most parents, including Liu Lina.

According to incomplete statistics of economic observer, since October, training institutions in many cities in Shanghai and Beijing have frequently closed down, involving more than 10 education and training institutions, including Weber education, happy bean education of Webers childrens English brand, Kerry baby, and alexeon. The training range is from English, early education, art training and other different education categories.

The rigid demand of extra-curricular education and training, coupled with frequent closures, brings worries. The resulting trust crisis casts a shadow of uncertainty over the development of the sunrise industry extra-curricular training.

Zhang Rui, founder of Zhengyang communication agency, and his company have been doing things related to education agency communication for many years. In an interview on October 30, he told the economic observer that the transmission of this distrust is extremely detrimental to the development of both ends of the education chain. Although some education and training institutions do not play according to the rules of the game, do not abide by the market rules, but the vast majority of institutions are enterprises that abide by the rules. It is normal and reasonable for enterprises to operate improperly and close down, which should not easily expand the adverse effects. On the other hand, education authorities, market supervision and administration and other departments can also play their respective functions, cooperate with relevant bankrupt training institutions to do a good job in liquidation, so that all parties in the depth can be reasonably expressed and properly arranged in terms of their attitudes and demands..

The collapse of training institutions

As the demand side of the deep training market, Wang Yiying, the students parent, is not doing well this October.

The art training institution she chose for her children, Tongle cultural and creative education center, ran away without notice on September 24. Before that, there was no difference between the children in the training institutions and the teachers in wechat. She didnt realize it until class was closed and the parents were as busy as a frying pan.

Wang Yiying is a cautious parent. Accountants professional characteristics make her particularly sensitive to the risks of everything, and she is no exception in the choice of reporting to childrens classes.

After investigating four or five painting training institutions, Lin always decided that Wang Yiying had three reasons: first, she had a long time. The organization has been alive for 14 years; second, it has a good reputation. Teachers are highly qualified teachers, and children like to have classes here. Thirdly, all kinds of certificates are complete.

For this reason, Wang Yiying felt very discouraged. Ive been so careful, I dont know how to choose in the future.

Like Wang Yiying, Lu Haiyang, located in Chaoyang District of Beijing, also suffered a deserted early childhood education institution in October this year. What she reported was an early childhood education institution called elefun, which chose the direct store of Joy City in Chaoyang. According to the public data, this institution is a chain training institution focusing on early childhood education. It was founded in 2009, has been in operation for 10 years, and has opened more than 150 offline stores in 28 provinces and cities nationwide.

I spent 15000 yuan to buy 66 lesson packages for my children, which are valid for one and a half years. Now just after six classes, the organization is gone, Lu said.

Like most families who have run away from educational institutions, Lu Haiyang is unable to contact the head of the early childhood education institution after receiving the notice of its suspension. In her wechat group, there are two rights protection groups in Chaoyang Joy City store. At present, the number of people in the group has increased to more than 900.

On October 19, LV Haiyang and these families organized large-scale rights protection, and reported the related issues to the public security organs. In the wechat group, she learned that most of the people reported 10000-30000 yuan for work, which was estimated to be between one million and ten million yuan.

Three days later, on October 22, alexions headquarters responded to the announcement on its official website about how to solve the remaining class hours of members. According to the announcement, the company will try its best to protect the legitimate rights and interests of its members and mitigate the losses caused to them. We also urge members to give more time, and more organizations will cooperate with us to produce better programs.

For the solution in the notice, LV Haiyang felt angry: since he knows that other stores in his business are in poor condition, why continue to recruit students before. Up to now, including Chaoyang Joy City store, the Huilongguan store, Tongzhou Wanda store, Longhu store, etc. where alexion is located have been closed.

According to incomplete statistics of economic observer, since October, training institutions in many cities in Shanghai and Beijing have frequently closed down, involving more than 10 education and training institutions, including Weber education, happy bean education of Webers childrens English brand, Kerry baby, and alexeon. The training range is from English, early education, art training and other different education categories.

The market is getting cold.

Zhang Jie (pseudonym) felt the cold spring in the whole training market last year.

Before that, the art training organization she founded has maintained an annual profit growth of 10% for five consecutive years in Harbin, the provincial capital city. But all of a sudden, last year, it was very slow. For this reason, Zhang Jie had to partner with more training institutions to hold group heating - and cooperate with other training institutions to provide some free courses through promotion for drainage. In fact, at the beginning, no one was willing to mix themselves into other enterprises when they were doing education and training institutions, so they felt that I had my own educational advantages and had my own food. But in the past two years, we all like to hold a group, which indirectly proves that the overall market environment is not very good, said Zhang Jie.

As well as the change, Zhang Jie found that there were many tob enterprises serving training institutions in her area at the beginning of this year.

In the third-party companies Zhang Jie contacted, the main service provided is to help the training institutions recruit students or promote new promotion programs: including what should community marketing do? How to do drainage test? Even for the staff of training institutions to organize some training courses such as incentive mechanism. One of the marketing programs is 198 yuan for courses from five institutions.

When the downstream market is in a very fierce competition, there will be more companies serving the enrollment in the upstream market, said Zhang Jie. When the market environment was good, there were not many upstream training institutions. Some are only companies that provide training courses of system construction or teaching and educational administration. This year, it is obvious that the number of such third-party companies in the market has increased significantly and spread from the south to the north.

With the progress of science and technology, education and training institutions expand from pure offline services to online services. With the help of the boundless advantages of the Internet, more education brands sink to the third and fourth tier cities, which also makes the market competition increasingly fierce. There are many monks but few. Zhang Jie said.

In her opinion, the entry of hot money has changed the pattern of local brands in the second and third tier cities, and now there are many more big brands. In a region, it is easy to see the pattern of competition among large brands, medium-sized organizations and small workshop organizations. But there are so many students, which also means that a child can be used less and less time and space, and the competition is more and more fierce.

The phenomenon of brand surplus also intensifies the situation that training institutions have to raise the cost of customer acquisition repeatedly in order to survive. At the moment, what training institutions in fierce competition want to solve most is the problem of drainage, the biggest end of the funnel, Zhang said.

And Zhang Jie has the same feeling as Mengru. He believes that the cost of sales accounts for a large proportion of the four major expenses of education. Mengru is the deputy general manager of Teri sports, a skiing training organization in Beijing. His organization is mainly for young people aged 5-17 who are interested in skiing.

Now some professional third-party companies will help you to do the recruitment channel, Mr. Meng said. This expense is very expensive, accounting for 15% - 20% of the total advance collection. For example, for a 10000 yuan course, they have to withdraw 1000 yuan to 2000 yuan, and the enrollment fee will not be eliminated until the next year.

With the increase of enrollment cost and the fierce market competition, some institutions use prepayment to expand the market.

In fact, we all know that this fund can only be regarded as revenue recognition after students plan classes. In calculation, it should also be calculated according to the split of a single course. Large training institutions are not allowed to use this fund, but small institutions do not have the recruitment team and channels of major brands, nor do they have good course design. In the early stage, they can only rely on third-party service companies Help them recruit.

When the money arrives, small institutions will use it to expand their brands, which is also the difference between regular institutions and small training companies in internal risk control, said Monroe.

The increase in sales costs is equally heavy for online education companies. Zhang Rui told the economic observer that the acquisition cost can also be regarded as a kind of sales cost. Generally, the acquisition cost of Internet education companies is much higher than that of offline institutions. For example, in this summer promotion, some training institutions spend ten million yuan a day on marketing, and the increase of customer acquisition cost will inevitably increase the overall sales cost.

Post training Era

The fierce market competition and the increase of sales cost are considered as the inducement of the poor operation of training institutions. But in the final analysis, it depends on the business ability of the enterprise.

Mengru believes that the crisis of some big brands such as Weber is more caused by their own poor management. Take English training as an example, from the rise of the New Oriental generation in the early stage to the well-known brands such as vipkid in the later stage, it has experienced nearly 30 years, from the early large class to the middle class, small class and now online 1-to-1 teaching, etc., the companys operation mode has changed a lot.. On the other hand, learning effect is a long-term accumulation process. Continuous and uninterrupted time and cost investment objectively result in low rate of course repurchase; the rising cost of teachers and other expenses also results in higher operating costs of enterprises; as a corporate enterprise operating education and training institution, it will also go bankrupt due to poor operation. Of course, the entry of capital will also lead to the blind expansion of some training institutions in business decision-making.

Over the years, educational and training institutions have run away from time to time. Its only this year that the collapse of big brands such as Weibo has raised the collective concerns of parents, he said.

In Zhang Jies view, trust is crucial to the development of the training industry. The threshold of education and training institutions is not very high. In the initial stage, it was founded on the viscosity and trust brought by a teachers ability. It is a slow decision-making process, relying on the trust of small and medium-sized training institutions to survive and grow.

When there is a crisis of trust, based on the principle of interest, more families will choose big brands and institutions for endorsement out of risk control. After this encounter, Wang Yiying has suspended her plan to report her children to another painting class. However, it is also difficult for her to stop the training of quality education, but the rigid demand of disciplines cannot be ignored, so she decided to pay more attention to New Oriental, tal and other brands in the future.

For parents to vote with their wallets, Mengru is not surprised at all: although some famous teachers have strong personal ability to go out alone to open classes, courses, etc., in fact, for most parents, a large brand training institution should be the lowest risk option.

Now, its time for good money to expel bad money, Zhang Jie judged. To some extent, the education industry has entered the stage of shuffling. Big brands and some sustainable brands will eventually survive. Medium-sized education institutions may be more difficult. Small institutions can survive because of the low cost, and more institutions will be replaced.

Zhang Jie decided to take part in more market-oriented activities for his own business. After going through the process from resistance to transformation, she has recognized that the third-party service companies are professional: once education and training are done, it is a commercial behavior, involving marketing and multiple management of the company. Its no longer an era of relying on a certain teacher. More service posts and sales posts are facing transformation and need their help and suggestions.

Now, what we can do is to strive to improve the internal strength and reputation of our enterprises, said Zhang Jie.

Compared with the cautious judgment of the above two practitioners, Zhang Rui is relatively optimistic. In his opinion, the market for teaching and training has been developing for such a long time, and the demand has existed for a long time. After a series of training events, parents will eventually be good for the brand of large training institutions, whether they hold money for purchase or wait and see, and people will believe that large institutions with brand endorsement.

On the other hand, families with training needs for low and middle-income families will ultimately have to look at their own budget. To meet the needs of parents, we should form a diversified supply mode and price range. Its not a single type of development. With the continuous improvement of education technology and the sharp change of market morphology, the productization of education services has become a trend of accelerating the reduction of education costs, Zhang said.

Source: economic observation net Author: Li Jing editor in charge: Hua Chengyu