School owners report varied opinions about offering students an opportunity to enroll or renew for a full year during tax season.
Some school owners indicate that it is genius to begin announcing during late February or March that the school will be running a tuition special for new annual enrollments and/or annual renewals during the month of March, April or May.
Their thinking is that tax season also means tax refund checks for many and thus what better time to offer students a bargain for a lump sum tuition payment?
Depending on when they filed their tax return students are likely to receive tax refund checks in March, April or May and will be deciding how to spend that lump sum of money that they normally do not have in hand, so why not give them a chance to use it for the Soo Bahk Do® training they love?
Worst case scenario is they do not respond to your offer and they buy a jet ski or bass boat instead. 🙂
Even schools that charge tuition month by month may reap a windfall simply by offering a full year pre-payment option during tax season. (March, April or May) Some school owners "sweeten" the full year offer with a new uniform, waive studio tournament entry fees during the year, one free seminar during the year, etc.
If only a small percentage of students take advantage of the annual tax refund offer, the school wins with an influx of cash from students who may only have that lump sum in hand once per year when they receive their tax refund checks and the students will be voluntarily committing to a year of training which is a good thing.
- Caution: It is generally not fiscally prudent to accept full annual payment from more than 15% to 30% of your students. A number of schools have gone bankrupt by "cashing out" too many of their students because they then do not have the monthly income coming in to meet monthly obligations. Additionally, some states have regulations about businesses collecting full year pre-payments, so check your states regs.
Other school owners indicate that tax season is a burden for their students, so they dare not offer anything like that during tax season.
What would (or do) you do?
How would (or do) you present such an offer?
What is your experience or perspective?
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