2023 marks the third year of Jackrabbit’s Youth Activities Industry Benchmark Report. Each year when analyzing aggregate client data and thinking about gymnastics, swim, dance, cheer, and music programs from a business and technology perspective, we always notice how unique each year is and the new successes and challenges that come with operating a youth activity business. While it comes at no surprise, we’ve seen owners make adjustments to remain profitable with the increased costs of running a business.
Tuition fees, in 2022, were increased an average of 24% over the previous year and are up 36% from 2020.
With publishing this industry report, our goal is to provide a much-needed snapshot of the youth activities industry for owners and decision makers in these businesses. With access to international family, class, student, staff and financial trends, you can better understand where your business is performing above average and where you could focus on areas of improvement.
Trends in Increasing Tuition Fees
Swim school, gymnastics gym, and studio owners, as well as industry advisors constantly discuss the strategy of increasing tuition fees to keep up with the cost of doing business. While the how-to is sometimes different, the underlying message remains the same – youth activities businesses need to increase tuition fees on a routine basis to run a thriving business.
Findings from the 2023 industry report show the average percent tuition increase over the past two years ranges anywhere from 66% increase for small businesses to 7% increase for enterprise facilities. Get more tuition and income growth information with the full report.
How often should you increase tuition fees?
Every swim and music school, gymnastics and cheer gym, and dance studio is different. Your location, size of program, demographics, and the market in your area should all play a role in making this decision. Different strategies work for different businesses but increasing tuition prices should be just that – a strategy.
The common frequency for increasing tuition fees is annually or every other year. Adjusting fees after a longer period of time can be effective, but you run the risk of customer complaints and churn (students leaving your program) if the sticker shock from the increase is too high.
Consistency is the key to keeping customers satisfied and your bottom line growing when raising tuition prices. Many business owners and industry experts we work with practice raising their prices every year at the beginning of a season, session or term. Because it’s routine, customers are accustomed to new prices when registering for the new season.
Whether it’s a set dollar amount or a percentage of your current tuition rate, the reality is, the cost of running a business continues to rise and there’s no reason your tuition rates shouldn’t increase as well. To strengthen your strategy, look at other fees that could be increased year over year such as showcase, rental, and birthday party fees.
Other Findings From the Youth Activities Industry Report
Advocates and owners in the youth activity industry continue to correlate properly staffed programs with customer retention and overall business growth. Sufficient staffing continues to be a challenge for swim, gym, and cheer programs. This year’s report shows that staff wages have increased 7% on average since 2020 among Jackrabbit Class clients, and 96% feel if they had more athletes in their program, they could pay their staff more and more consistently.
Download the full Youth Activities Industry Benchmark Report to see average discounting rates, student counts, family engagement trends, and other key findings that will help you evaluate your businesses performance.
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