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Start a foreign language instruction business by following these 9 steps:
You have found the perfect business idea, and now you are ready to take the next step. There is more to starting a business than just registering it with the state. We have put together this simple step guide to starting your foreign language instruction business. These steps will ensure that your new business is well planned out, registered properly and legally compliant.
STEP 1: Plan your Business
A clear plan is essential for success as an entrepreneur. It will help you map out the specifics of your business and discover some unknowns. A few important topics to consider are:
- What are the startup and ongoing costs?
- Who is your target market?
- How long it will take you to break even?
- What will you name your business?
Luckily we have done a lot of this research for you.
What are the costs involved in opening a foreign language instruction business?
Costs for starting a foreign language teaching business could be as low as zero dollars, for those who choose to teach out of their own home, or visit students’ homes, instead of renting office or classroom space. The internet has some great free instructional materials, and youtube is filled with clips of foreign language music and films to supplement your lesson plans.
What are the ongoing expenses for a foreign language instruction business?
Expenses can be kept relatively low for those working with a modest budget. As your business expands, you may decide to rent out office and / or classroom space. Costs vary greatly depending on your location and desired square footage. Companies with an average of ten employees spend around $6,000 a month on rent. However, creative use of space, or sharing space with another company, can significantly reduce costs.
Who is the target market?
A foreign language instruction business can attract a wide variety of students: children and adolescents, business professionals, doctors and nurses, or people who simply enjoy the adventure of travel.
How does a foreign language instruction business make money?
A foreign language instruction business makes money by offering lessons in one or more world languages. Students may pay for one class at a time, or purchase a certain number of classes up front. An additional source of revenue could include the sale of language-learning materials, such as books, CDs, and DVDs.
How much can you charge customers?
Language classes can range from approximately $20 - $70 an hour, depending on the instructor’s level of experience and the class size.
How much profit can a foreign language instruction business make?
Your ability to generate income will depend on how many teachers you have on your team, and how many classes you are able to schedule each week. As your business’ reputation grows, you can expect to increase profits considerably.
How can you make your business more profitable?
Group classes bring in more students and require less class time than one-on-one sessions. To offset the challenge of handling multiple students at a time, have two teachers lead the class.
Another option is to assign a certain part of your teaching team to the higher end of the market: doctors, business professionals, military personnel, etc. This can increase revenue and also diversify your client-base.
Carry an inventory of language learning books, cds, and software for your students to purchase, to supplement their in-class study.
Offering online classes can expand your reach virtually unlimitedly. Skype, Google Hangouts, and other internet platforms offer convenient and effective ways to host classes on the Internet, and online learning is a quickly growing market.
What will you name your business?
Choosing the right name is very important. We recommend checking if the business name you choose is available as a web domain and securing it early so no one else can take it.
After registering a domain name, consider setting up a professional email account (@yourcompany.com). Google's G Suite offers a business email service that comes with other useful tools, including word processing, spreadsheets, and more. Try it for free
STEP 2: Form a legal entity
Establishing a legal business entity such as an LLC prevents you from being personally liable if your foreign language instruction business is sued. There are many business structures to choose from including: Corporations, LLC's, and DBA's.
You should also consider using a registered agent service to help protect your privacy and stay compliant.
For most small businesses forming an LLC is a great option, and it's easy enough to form by yourself, or check out the top business formation services.
STEP 3: Register for taxes
You will need to register for a variety of state and federal taxes before you can open for business.
In order to register for taxes you will need to apply for an EIN. It's really easy and free!
You can acquire your EIN for free through the IRS website, via fax, or by mail. If you would like to learn more about EINs and how they can benefit your LLC, read our article, What is an EIN?.
STEP 4: Open a business bank account & credit card
Using dedicated business banking and credit accounts is essential for personal asset protection.
When your personal and business accounts are mixed, your personal assets (your home, car, and other valuables) are at risk in the event your business is sued. In business law, this is referred to as piercing your corporate veil.
Open a business bank account
- This separates your personal assets from your company's assets, which is necessary for personal asset protection.
- It also makes accounting and tax filing easier.
Get a business credit card
- This helps you separate personal and business expenses by putting your business' expenses all in one place.
- It also builds your company's credit history, which can be useful to raise money and investment later on.
STEP 5: Set up business accounting
Recording your various expenses and sources of income is critical to understanding the financial performance of your business. Keeping accurate and detailed accounts also greatly simplifies your annual tax filing.
STEP 6: Obtain necessary permits and licenses
Failure to acquire necessary permits and licenses can result in hefty fines, or even cause your business to be shut down.
State & Local Business Licensing Requirements
Certain state permits and licenses may be needed to operate a foreign language instruction business. Learn more about licensing requirements in your state by visiting SBA’s reference to state licenses and permits.
Most businesses are required to collect sales tax on the goods or services they provide. To learn more about how sales tax will affect your business, read our article, Sales Tax for Small Businesses.
In addition, certain local licensing or regulatory requirements may apply. For more information about local licenses and permits:
- Check with your town, city or county clerk’s office
- Get assistance from one of the local associations listed in US Small Business Associations directory of local business resources.
A foreign language instruction business may consider creating a services contract. This services should clearly outline the terms of instruction including price and level of proficiency once lessons are over.
STEP 7: Get Business Insurance
Insurance is highly recommended for all business owners. If you hire employees, workers compensation insurance may be a legal requirement in your state.
STEP 8: Define your brand
Your brand is what your company stands for, as well as how your business is perceived by the public. A strong brand will help your business stand out from competitors.
How to promote & market a foreign language instruction business
A great place to start is at the language department of your local elementary, middle school, high school, or college campus. A great way to attract clients as you begin your business is to offer a student discount.
Churches, hospitals, schools, grocery stores, and other public places often have a community bulletin board where you can post a flyer or an advertisement for your business. Language learners come from all kinds of backgrounds, so be creative about where you place your marketing materials.
Craigslist, facebook, and other online forums can also be a good place to promote your foreign language learning business.
By providing quality instruction, your business also has a good shot of growing steadily over time, simply by word-of-mouth.
Recommended: Get started with local advertising for your business with a $300 credit from Yelp.
How to keep customers coming back
Doing a mentorship with an established foreign language instructor in your area is a great way to see what it takes to keep students coming back over a long period of time.
You may also consider catering your business specifically to a niche market, like those who often travel for work and require basic language skills as part of their profession.
The American Council on the Teaching of Foreign Languages offers members the latest tips and resources for language educators. Membership fees start at only $45 a year, with additional benefits offered to those who opt for a higher level of membership. Studying up on materials like these will help ensure that your team is able to consistently provide a top-notch learning experience.
STEP 9: Establish your Web Presence
A business website allows customers to learn more about your company and the products or services you offer. You can also use social media to attract new clients or customers.
Start A Foreign Language Instruction Business In Your State
Select your state below for an in-depth guide on completing each of these steps in your home state.
Is this Business Right For You?
Teaching a language generally requires a person to be fluent in that language. However, a language lover who is still learning might consider teaming up with others who are fluent in order to start this business. Definitely, one must possess a real passion for world culture, and an interest in sharing that appreciation with his or her students. This is what makes the challenges of language-learning worthwhile.
What happens during a typical day at a foreign language instruction business?
The models for a foreign language teaching business are varied, and so are the general activities one would expect to encounter as a business owner. Typically, foreign language instruction business owners are also teachers themselves. As such, common activities include:
- Evaluating students’ language proficiencies
- Preparing individual or group lessons
- Correcting students’ in-class or at-home assignments
In addition to these tasks, a foreign language instruction business owner should set aside time to find interesting and relevant learning material to share with his or her students. This might include foreign language films, music, artwork, newspapers, or magazine clippings that not only provide an opportunity to improve one’s language skills, but also give students a chance to learn more about the customs and lifestyle of the people who speak their target language.
What are some skills and experiences that will help you build a successful foreign language instruction business?
The most important skill in foreign language teaching is the ability to connect with people. Whether teaching a large group or working one-on-one with a student, a foreign language teacher must find a way make the material fun and relevant for each individual.
You should also be passionate for learning languages and exploring other cultures. At least one person on your team should be fluent in the target language, as this will give your business credibility and quality instruction.
Generally, foreign language teachers should have a bachelor's degree in the target language. Alternatively, teachers may be native speakers of the language. Still, it helps to possess a foreign language teaching degree or certificate, as this is required of nearly all teachers at public and private schools and universities.
Adventurous persons may choose to instead spend time living and working or studying abroad while they attain fluency in their target language, before returning to the US to start their business.
What is the growth potential for a foreign language instruction business?
It all depends on your ambition and organizational skills. Foreign language learning is now in higher demand than ever, as international travel and communication becomes easier and more vital to the global economy. Some may prefer to keep their business local, while others may choose to branch out over time and develop a worldwide brand.
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Take the Next Step
Find a business mentor
One of the greatest resources an entrepreneur can have is quality mentorship. As you start planning your business, connect with a free business resource near you to get the help you need.
Having a support network in place to turn to during tough times is a major factor of success for new business owners.
Resources to Help Women in Business
There are many resources out there specifically for women entrepreneurs. We’ve gathered necessary and useful information to help you succeed both professionally and personally:
If you’re a woman looking for some guidance in entrepreneurship, check out this great new series Women in Business created by the women of our partner Startup Savant.
How and when to build a team
Teaming up with other language teachers, either at the beginning of your business, or after establishing your own student-base, is a great strategy to reach a much wider audience. By building a strong team of teachers, your business can offer a variety of language courses, and ultimately attract more students.
As your business expands, you will want to consider hiring more staff to help take care of scheduling, marketing, and managing finances.
Average annual salaries for these positions are: