Sprachschule: Warum Sie viele Schüler, aber kaum Gewinn haben

«We have 140 students in 22 groups, and last year's turnover was nearly 5 million. Yet I took home less than I pay a strong teacher. Until I broke profit down group by group, I was sure I simply needed to raise prices.»

Sound familiar? The school is buzzing, the timetable is packed, the September intake filled almost every group. By the reviews, it's a success. Then at the end of the month you look at the balance and can't work out where it all went. You really do have plenty of students. It's just that revenue and profit live in different rooms, and the owner usually sees only the first.

A language school doesn't earn «in general». It earns by groups, by teachers and by individual lessons, and each of those bricks has its own math. One group carries the school up, the one next door quietly eats the profit, and in the report they're merged into a single cheerful revenue figure. Let's see how to tell who is who.

Profit by group and teacher in plain words

Revenue is how much money came in. Profit is what's left after you've paid for whatever produced that revenue. In a school almost every cost is tied to a specific group: the salary of the teacher who runs it, the classroom rent for those hours, handouts, a share of admin. Subtract these direct costs from what the group's students paid and you get the group's margin. That is your real earnings, not the number at the top of the report.

The same goes for teachers. One runs five full groups and gives the school a healthy margin. Another drags three half-empty ones plus a few discounted one-to-ones, and after his salary you're left with pennies. In the summary report they're both simply «teachers». Broken down, they're night and day, and until you separate them you're funding the second out of the first.

Let's count it out. Olga runs five full groups: after her salary and rent each leaves the school a few thousand clear, and together that's a solid sum every month. Igor runs three groups of four to five students and takes four more one-to-ones, half of them discounted «for friends». He brings in almost as much revenue as Olga. But his margin is three times smaller, because his groups are under-filled and the discounted individuals barely cover his own rate. In the annual report they both «brought in a million in revenue». In reality one holds the school up and the other rides on her back.

Why the average lies

Average fill rate across the school is the most dangerous figure in your reports. Say you have 22 groups of 10 seats and 140 students. The average comes to 6.4 students per group, which sounds decent. Hidden behind that average: eight groups are full, six are half empty, and four survive on three students and run at a loss. One number, and not a single signal that four of your groups need attention right now.

An empty seat in a group is almost pure loss. The teacher gets the same pay for the session whether eight sit in front of them or five. The classroom costs the same. Utilities, the administrator, the platform — all identical. Every unfilled chair adds nothing to your costs yet takes away all the revenue it could have brought. So a group of 5 against a plan of 10 is not half the profit. Most often it's zero or a loss: the first students cover the fixed costs, and the profit comes from the last ones, the very students you didn't enroll.

Churn belongs here too. A student who leaves mid-course is not just one lost payment. You won't resell that seat in a formed group before the end of term, because the syllabus has moved on. Let's count what one departure costs. The student paid ₴2,800 a month, with four months left to the end of term, which is ₴11,200 in lost revenue. But the true price is higher: the seat sits empty while the group's costs haven't changed by a penny. Everyone who leaves early hits you twice: they underpay, and they make the group less profitable for everyone who stayed.

An example in numbers

Take four groups of one school for a month. The price is ₴2,800 per student, the teacher is paid a fixed ₴9,000 per group (earned for the sessions run regardless of headcount), and the direct fixed costs per group — classroom rent and admin — are another ₴6,000. Look at the margin.

Four groups, one shared revenue of ₴75,600. The margin tells a completely different story. Groups A and D together give you ₴20,400. Group B barely breathes. And group C, even though its students turn up and pay on time, takes ₴6,600 from you every month: it doesn't cover the teacher's rate and the rent. The summary report hides this, it just says «revenue 75,600, all good». Meanwhile you are literally funding group C out of the profit of A and D, and you don't even know it.

What to do with group C? There are several options, and all of them are visible only once you see its margin on its own. You can merge it with another small group of the right level. You can turn it into a mini-group format with a higher price per student, where three people is the norm, not a loss. You can raise the price or close enrolment for that slot. The point is that the decision now rests on a number, not on a reluctance to «break up a nice bunch of people».

«I thought every group earned at least a little. It turned out that for two hours a week I was effectively paying so that three people could study comfortably at lunchtime.»

Teacher pay and fill rate

Two figures worth watching every month are the share of teacher pay in revenue and the fill rate of your groups. They're linked directly, and this is where the answer to why so little is left hides.

When you pay teachers a percentage of the group's revenue, it seems risk-free: more comes in, more goes out. But rent, administrators and the platform don't go anywhere, and on a small group it's exactly these fixed costs that push you into the red, even though the salary adjusted itself. When you pay a fixed rate per hour, the effect is even harsher: an under-filled group costs you the same as a full one and brings in less.

Let's count it on group B from the table. Revenue is ₴16,800, and even if you paid the teacher not a fixed rate but 45% of revenue, that's ₴7,560. Add rent and admin of ₴6,000. You're left with ₴3,240. On the full group A the same 45% is ₴12,600, and the margin after rent is ₴9,400. The percentage looks fair to everyone, but only a filled group gives you profit. A percentage protects you from a salary loss, not from fixed costs eating your under-filled groups.

A healthy school keeps its teacher payroll roughly within 40–50% of revenue. If you jump past that line, look for the reason among the usual three: the price is too low, the groups are under-filled, or too many discounts have been handed out. It's not a verdict, it's a diagnosis: the number tells you where to look.

Rent is its own story. Many schools rent a classroom for the whole day, or the whole premises, and fill it half the time. An empty classroom at midday or in the morning costs exactly the same as a full one in the evening. If you count rent not per month but per hour of teaching, it often turns out the morning and daytime slots run at a loss simply because the space sits idle. That too is visible only broken down, not in the single «rent» line.

Groups versus one-to-ones

One-to-one lessons look premium: the hourly rate is higher and parents pay willingly. But count the margin on one hour of your teacher's work and the picture often flips.

A simple example. A one-to-one costs ₴600 an hour, ₴350 of it goes to the teacher, and you're left with ₴250 from one person. Now a group of 8 students at ₴180 for that same hour is ₴1,440 of revenue; the teacher gets the same ₴350 for their hour, and you keep over ₴1,000. The same hour of the teacher's time, and your margin differs fourfold.

One-to-ones aren't the enemy. They work well as a premium service, as a way to warm a student up before a group or to cover a non-standard request. The trouble starts when a school quietly drifts into one-to-ones because they're easier to fill, loading its most expensive resource — teacher time — with the least profitable format.

It's also worth looking at mini-groups — two or three people at a higher price. That's the sweet spot: the margin per teacher hour is higher than in a big cheap group, and the load is steadier than a one-to-one you can easily lose. But the same rule applies: count the margin per hour, don't just cheer a bigger invoice.

The seasonality you can't escape

A language school lives by the calendar, and you have to build that into your money in advance. September is gold: everyone comes back, the intake fills the groups, course payments pour in one after another. Then it's steady work until May. And then summer, when part of your students put lessons on pause, groups fall apart, revenue collapses, while rent and the core team's salaries stay put.

Here's the trap. In September there's a lot of money in the account and it feels like the school is rich. In fact a good part of that sum is advances for months you still have to deliver, plus the cushion that should carry you through summer. Spend that money as profit in autumn and by summer there'll be nothing to pay teachers and rent with. So you need to see the yearly rhythm in advance: how much to set aside from the September peak to get calmly through July and August.

A simple rule that saves you in summer: look at what the school spends per month in the quiet period — rent, the core team, the platform, your own salary. Multiply by the two or three summer months of the dip. That's how much to set aside from the September and autumn peak in a separate account and not touch. If the figure frightens you, that's not a reason to ignore it, it's a reason to revisit prices and fill rates while it's still September.

How it sounds in real life

You hear the problem in a few familiar phrases. «All our groups are full» — while full means anywhere from three to ten, and half of them don't cover the teacher. «This teacher earns a lot for the school» — and no one has tried counting his groups net of salary and rent. «One-to-ones are our premium» — when they're the very thing eating the most expensive hours. «We're flush in autumn, we're in the black» — two weeks before July, when that surplus has to stretch across empty months. Every one of these is a decision by feeling where a simple number has existed all along.

How to see this in Finmap

The main mistake is counting the school as one number. To understand who feeds you, you need to see income and costs by group, teacher and format. In Finmap you set up each group or direction separately, post student payments as income against those directions, and keep the direct costs — teacher rates, classroom rent, materials — apart from the general ones. Then each group's margin calculates itself, and a loss-making group stops hiding inside overall profit: you see it at once, just as you see that two full groups are carrying the whole school.

The payment calendar works separately. It shows not only how much money you have today, but when course payments come in and when teacher payouts and rent fall due. This is where the truth about the September peak becomes visible: how much of it is an advance for prepaid months, and how much is really yours. The summer dip then stops being a surprise, because you set the cushion aside back in autumn instead of hunting for money in July.

A few tips to finish

• Count every group separately. The school average hides both the loss-making groups and the ones that feed you.
• Set the minimum fill at which a group breaks even, and don't launch groups below that threshold.
• Keep the share of teacher pay in view every month, not once a year.
• Compare the margin of a group and a one-to-one per hour of teacher work, not by the price to the client.
• Set part of the September payments aside at once, separately, as a summer cushion.
• Count the cost of churn: a student who leaves mid-course leaves an empty seat you can no longer sell.

Related — how to stop eating all the profit and start paying yourself and how much of your revenue can go to salaries.

«There is no profitable school in general. There are profitable groups quietly carrying the loss-making ones until you see it. The moment you separate them, the decisions become obvious.»

Money Doesn't Disappear. You Just Don't See It.

Want to see which groups and teachers actually earn and which run on your enthusiasm alone? Try Finmap free for 14 days and see profit for each group for the first time, instead of one shared revenue number.