How to Start a Homeschool Business

Homeschooling is an undertaking that is carried out by parents who want to teach their children at home, but today, entrepreneurs have begun to make money from homeschooling by starting homeschooling businesses.

Available data shows that there were about 3.7 million homeschooled students in 2020-2021 in grades K-12 in the United States (roughly 6% to 7% of school-age children). There were about 2.5 million homeschooled students in spring 2019 (or 3% to 4% of school-age children).

Steps on How to Start a Homeschool Business

Conduct Market Research

The first step in the market research process for your homeschool business is to develop market-based research questions in line with your overall business goal and objective.

In this regard, you should source information that will help you maximize your business, information that will tell you what your potential market will be looking out for from a homeschool business and also help you operate your homeschool business with less stress and of course, build the business to profitability.

a. Who is the Target Market for Homeschool Business?

Parents
Orphanages
Foster homes

b. Is Homeschool Business a Profitable Business?

Yes, the homeschool business is profitable. Statistics show that as of February 2020, million Americans had gone through homeschooling at least once. Until 2019, the number of homeschooled students had been growing by between 2% to 8% each year. From 2019 to the fall of 2020, the percentage of homeschooled students changed from 3.4% to 9%.

c. Are There Existing Niches in the Industry?

Yes, there are existing niches when it comes to homeschool business and they are;

Traditional Programs: In a traditional program, families normally keep a structure mirrored in a school setting, meaning that they buy curriculum, textbooks, tests, teacher guides, and schedules.

Online Homeschool Programs: Many online homeschool programs have pre-recorded videos that students can watch and re-watch until they learn the content.

Blended Learning Programs: Blended learning is a term used to describe a combination of online and traditional curricula. This option lends even more customization to students because it offers more variety in classes to best meet their learning styles and abilities.

d. Who are the Major Competitors?

Bridgeway Academy
Homeschool Connections
Easy Peasy All-in-One Homeschool
Forest Trail Academy
Oak Meadow
FreedomProject Academy
Challenger Learning Center
Home Educators Association of Virginia
Coalition for Responsible Home Education
The HomeScholar LLC
Network of International Christian Schools
Laurel Springs School
Texas Virtual Academy at Hallsville
Faith Lutheran School
McKinney Christian Academy
K12 Academics, Ambler, PA 19002
Pueblo School for Arts and Sciences
Life Preparatory Academy
Andover eCademy
Casady School.

e. Are There County or State Regulations or Zoning Laws for Homeschool Business?

Yes, there are county or state regulations and zoning laws for homeschool businesses, and players in this industry are expected to work with the existing regulations governing such business in the county or state where their business is domiciled.

Please note that in the United States, homeschooling is lawful in all fifty states. The U.S. Supreme Court has never ruled on homeschooling specifically, but in Wisconsin v. Yoder, 406 U.S. 205 (1972) it supported the rights of Amish parents to keep their children out of public schools for religious reasons.

f. Is There a Franchise for Homeschool Business?

Yes, there are franchise opportunities for homeschool businesses, and here are some of them;

ABC Tutors
Little City Kids
Child Tutoring.

g. What Do You Need to Start a Homeschool Business?

A Feasibility Report
Business and Marketing Plans
Business Licenses and Permits
Academic Syllabus
Teaching Aids and Materials
Office Facility
EIN (Employer Identification Number)/Federal Tax ID Number.
A Corporate Bank Account
Employees
Startup Capital

Choose a Memorable Business Name

When looking to start a business, before you can begin to file the necessary documents with the constituted authorities or start your website, it is necessary that you come up with a name that you will be recognized with. It is essential that the name you come up with can easily be pronounced, is unique and easily memorable.

Some of the catchy business name ideas suitable for a homeschool business are;

Creative Homeschool Business Name ideas

School Up© Academy, Inc.
Child Edu® Homeschooling Academy, LLC
First Base© Homeschoolers, Inc.
Excel Tutors® Homeschooling Academy, Inc.
Jonah House™ Homeschooling Academy, Inc.
Jerry Benson™ Homeschooling Academy, LLC.
Bricks School© Homeschooling Academy, LLC
Jonny Moore® Homeschooling Academy, Inc.
Golden Generation© Homeschooling Academy, Inc.
Martins© Homeschooling Academy, Inc.
Glory Landers® Homeschooling Academy, LLC
Aries Pupils® Homeschooling Academy, LLC
Kid World™ Homeschooling Academy, LLC
Glitters© Homeschooling Academy, Inc.
First Class® Homeschooling Academy, Inc.
Orange County™ Homeschooling Academy, Inc.
One Teacher™ Homeschooling Academy, Inc.
Teach Them© Homeschooling Academy, Inc.
One Stop® Homeschooling Academy, LLC
Los Angeles™ Homeschooling Academy, Inc.

Register Your Business

a. What Type of Business Structure is Best for Homeschool Business?

Even though there are several options when it comes to the business structure of a homeschool business, the one that most players in this line of business consider is an LLC. It is common to consider an LLC because providers want to protect themselves from lawsuits.

Please note that an LLC will need an EIN if it has employees or if it will be required to file any of the excise tax forms listed below.

b. Steps to Form an LLC

Choose a Name for Your LLC.
File Articles of Organization.
Choose a registered agent.
Decide on member vs. manager management.
Create an LLC operating agreement.
Comply with other tax and regulatory requirements.
File annual reports.

c. What Type of License is Needed to Open a Homeschool Business?

You would need to contact your state’s education department and local Board of Education to learn the requirements that will apply to your homeschool business. At the minimum, you will need a business license, tax identification number, and liability insurance.

d. What Type of Certification is Needed to Open a Homeschool Business?

Bachelor Degree
General teacher certification or licensure exam.

e. What Documents are Needed to Open a Homeschool Business?

DBA
EIN
Business and liability insurance
Federal Tax Payer’s ID
State Permit and Building Approval
Certificate of Incorporation
Business License
Business Plan
Employment Agreement (offer letters)
Operating Agreement for LLCs
Insurance Policy
Online Terms of Use
Online Privacy Policy Document
Contract Document
Company Bylaws
Memorandum of Understanding (MoU)

f. Do You Need a Trademark, Copyright, or Patent?

If you are considering starting a homeschool business, usually you may not have any need to file for intellectual property protection or trademark. This is so because the nature of the business makes it possible for you to successfully run it without having any cause to challenge anybody in court for illegally making use of your company’s intellectual properties.

Cost Analysis and Budgeting

a. How Much Does It Cost to Start a Homeschool Business?

A standard homeschool business can cost anywhere from $1,000 to $100,000 depending on the type of teaching approach (online or onsite), the number of home tutors, and your office facility.

b. What are the Costs Involved in Starting a Homeschool Business?

The total fee for registering a business in the United States of America – $750.
Legal expenses for obtaining licenses and permits as well as the accounting services total – $1,200.
Marketing promotion expenses (2,000 flyers at $0.04 per copy) for the total amount of $80.
The cost for hiring a business consultant (writing of business plans inclusive) – $2,500.
Insurance (general liability, workers’ compensation, and property casualty) coverage at a total premium – $2,400.
The cost of accounting software, CRM software, and Payroll Software – $1,500
The cost for payment of rent for 12 months at $1.76 per square foot in the total amount of – $35,600.
The cost for facility remodeling – $5,000.
Other start-up expenses including stationery – $100
Phone and utility deposits will cost – ($2,500)
Operational cost for the first 3 months (salaries of employees, payments of bills et al) – $20,000
The cost for start-up inventory (teaching aids, computers, printers, telephone, and books) – $12,027
The cost of launching an official website – $600
Miscellaneous – $2,500

c. What Factors Determine the Cost of Opening a Homeschool Business?

The size and niche idea of the homeschool business
The choice of location
The required licenses and permits
The type of facility (if you choose to rent an office facility)
The cost of branding, promotion, and marketing of the homeschool business
The cost of furnishing and equipping the homeschool office facility
The cost of the insurance policy covers
The cost of registering the business
Source of your supplies and ongoing expenses
Cost of recruiting and training your staff
The cost for the purchase and customizing of uniforms

d. Do You Need to Build a Facility? If YES, How Much Will It Cost?

No, you don’t need to build a facility for your homeschool business because you are expected to teach your student in their homes or from your online platform.

e. What are the Ongoing Expenses of a Homeschool Business?

Supplies (inventory expenses)
Utility bills (internet subscriptions, phone bills, signage, and software renewal fees et al)
Salaries of employees

f. What is the Average Salary of your Staff?

Admin Officer (Accountant) – $32,000 Per Year
Private Home Tutors – $29,630,000 Per Year

g. How Do You Get Funding to Start a Homeschool Business

Raising money from personal savings and sale of personal stocks and properties
Raising money from investors and business partners
Sell shares to interested investors
Source for soft loans from your family members and friends.

Write a Business Plan

a. Executive Summary

Excel Tutors™ Homeschool Academy, LLC is a neighborhood homeschool business that will be located in a fast-growing community in San Antonio, Texas. Excel Tutors™ Homeschool Academy, LLC is equipped to provide high-quality, private tutoring and academic coaching for all types of students from our online platform and in the homes of our students.

b. Products and Service

Excel Tutors™ Homeschool Academy, LLC will offer services such as tutoring children, creating educational games to be used in homeschool environments, homeschool consulting, homeschool workshops, and fine arts instruction.

c. Mission Statement

Our mission is to establish a homeschool business that will become the number one choice for parents who are interested in homeschooling their kids.

Vision Statement

Our vision is to become the leading homeschool academy in Texas and with brand recognition all across the United States of America.

d. Goals and Objectives

The goals and objectives of a homeschool business are to work with parents to provide customized learning and education for their kids.

e. Organizational Structure

Head Teacher (Owner)
Home Tutors

Marketing Plan

a. SWOT Analysis

Strength:

Ideal location for homeschooling business
Highly experienced and qualified employees and management
Availability of different types of homeschooling techniques and teaching aids.

Weakness:

Financial constraints may restrict the publicity and branding of the business
A new business that will be competing with well-established homeschool businesses and schools in the city.
Inability to retain our highly experienced and qualified employees longer than we want during the teething stage of the business.

Opportunities:

A rise in the number of parents who would want to homeschool their kids
Online market, new services, new technology, and of course the starting of new markets.

Threat:

The arrival of new homeschooling businesses within our market space
Low demand during the pandemic (home tutors) will reduce industry profitability.
Economic uncertainty
Liability problems
The government could change its regulatory status and decide to enforce strict regulations that can strangulate new businesses like ours.

b. How Do Homeschool Businesses Make Money?

Homeschool businesses make money by charging parents for tutoring their children.

c. Payment Options

Payment via bank transfer
Payment with cash
Payment via credit cards
Payment via online bank transfer
Payment via check
Payment via mobile money transfer

d. Sales & Advertising Strategies

Introduce your homeschool business by sending introductory letters alongside your brochure to parents, orphanages, and other key stakeholders throughout the city where your homeschool business is located.
Advertise on the internet on blogs and forums, and also on social media like Twitter, Facebook, and LinkedIn to get your message across
Create a basic website for your business so as to give your business an online presence
Directly market your services.
Join local homeschool business associations for industry trends and tips
Advertise our business in community-based newspapers, local TV and radio stations
List your business on yellow pages ads (local directories)
Encourage the use of word-of-mouth marketing (referrals)

Financial Projection

a. How Much Should You Charge for your Product/Service?

The cost of homeschooling averages $700 to $1,800 per student annually. For a family of four with two school-aged children, this means homeschooling may cost anywhere from $1,400 to $3,600 per year.

b. How Much Profit Do Homeschool Business Owners Make a Year?

It depends, but the available report shows those who work for larger homeschool businesses report earning between $45,000 to $75,000 per year. Independent homeschool business owners with no employees report earning as much as $35,000 annually.

c. What Factors Determine the Amount of Profit to Be Made?

The capacity of the homeschool business
The types of additional services offered
The location the homeschool business is covering
The management style of the homeschool business
The business approach of the homeschool business
The advertising and marketing strategies adopted by the homeschool business
The number of years the homeschool business is in business

d. What is the Profit Margin of a Homeschool Business?

The profit margin of a homeschool business is not fixed. It could range from 35 percent to 65 percent or more depending on your ongoing expenses.

e. What is the Sales Forecast?

Below is the sales forecast for a homeschool business. It is based on the location of the business and other factors as it relates to such startups in the United States;

First Fiscal Year: $240,000
Second Fiscal Year: $260,000
Third Fiscal Year: $300,000

Set Up your Office

a. How Do You Choose a Perfect Location for Homeschool Business?

The demography of the location especially as it relates to children of school age
The purchasing power of businesses and residents of the location
Accessibility of the location
The number of homeschool businesses, and schools in the location
The local laws and regulations in the community/state
Traffic, parking and security et al

b. What State and City are Best to Open a Homeschool Business?

Manhattan, New York
Pittsburgh, Pennsylvania
Boston, Massachusetts
Montclair, New Jersey
Brooklyn, New York
Chicago, Illinois
Durham, North Carolina
Los Angeles, California
Green Bay, Wisconsin
Dallas, Texas

c. What Equipment is Needed to Operate a Homeschool Business?

Teaching aids
Laptops

Hire Employees

When it comes to hiring employees for a standard homeschool business, you should make plans to hire a competent Head Tutor (owner), and home tutors.

Launch the Business Proper

One way to get your homeschooling business known in your neighborhood is to embark on massive publicity both online and offline. This will pay you more than organizing an opening party.

a. What Makes a Homeschool Business Successful?

Choose a good location and facility to launch the business
Make sure you hire experienced home tutors
Engage in continuous training and re-training of your employees
Be deliberate with your marketing sales approach
Encourage the use of word of mouth to promote your homeschool business
Leverage all available online and offline platforms to promote your homeschool business

b. What Happens During a Typical Day at a Homeschool Business?

The business is open for the day’s work
Tutors are briefed
Home tutors go to the house of students to teach them
The business is closed for the day.

c. What Skills and Experience Do You Need to Build a Homeschool Business?

Excellent teaching skills
Customer services skills
Interpersonal skill
Patient
Good endurance skills
Accounting and bookkeeping skills
Business management skills
Bargaining skill
Work experience in a homeschooling
Experience in managing people
Experience in business administration
Experience in handling children and different learning stages.