Business

How to Start a Tutoring Business

Do you enjoy sharing your knowledge? Are you a teacher looking for a side hustle? If you have a lot of knowledge to share and are capable of teaching others, then you may be sitting on a potential goldmine! If you are interested in learning how to start a tutoring business, you’ve come to the right place.

Right now, there’s a strong demand for good tutors and the trend is rising.  According to the site Globe News Wire

“[The] global private tutoring market was valued at approximately USD 96,218 million in 2017 and is expected to generate around USD 177,621 million by 2026.”

Selling tutoring services can be an excellent side hustle or full-time business. The typical tutor charges anywhere from $25 to $75 per hour for their services.  Even if you tutored for just 5 hours per week, that would work out to an extra $6,500 to $19,500 of side income.  That’s not too shabby!

And that’s just the typical range.  Depending on what service you offer and who your clients are, you might even be able to command a surprisingly higher rate.  

For example, 33-year-old Indiana native Nathaniel Hannan claims to make up to $1,250 per hour tutoring the children of wealthy families who are looking to get a leg up on the competition.  While that’s a particularly rare situation, it does go to show: The demand is there for good tutors and people are willing to pay for it.   

Great!  But how can you go about finding them?  

In this post, we’ll go through everything you need to know about how to start a tutoring business.  Follow these steps and it won’t be long before you find out how beneficial this type of side hustle can be.

Tutoring Business Planning

How To Start A Tutoring Business: Decide Your Niche

The first thing you need to do before you can start tutoring is to decide what it is that you would like to teach.  Specifically, what would be your niche? 

Don’t try to cover it all when you start a new tutoring business. Creating a specialized tutoring service is a much stronger marketing strategy. First off, it will allow you to focus your energy and become an expert in your field. Second, it will help you build your reputation much faster as people rave about your quality work! For example, if someone is looking for a great tutor to help with college entrance exams, they are unlikely to go to the same tutor used by elementary school parents.

Choose a niche and stick with it. Here are some things to consider:

Age Range

  • Elementary School Students
  • Middle School Students
  • High School Students
  • College Students
  • Adults

Topics

  • Math
  • English
  • Science
  • Reading

Specialized Services

  • Test Prep
  • Typing
  • Personal Finances
  • Technology

If you want to run a successful business, you should choose a niche that plays off of your strengths. Good at math? Focus on math! Good at test prep? Focus on test prep. You may also choose your niche based on your connections and potential marketing strategy. For example, if you have a connection at a local elementary school, you make focus on elementary school tutoring.

Depending on the niche you’d like to go with, you’ll want to scope out the competition.  See how many other people in your area are offering similar types of service and what they are charging.  Chances are your competition may be pretty slim.  But even if it isn’t, don’t underestimate yourself.  Think about what value you could bring to the table the others likely won’t.

Conceptualizing Tutoring Business

At the same time that you’re doing all of this, you’ll also want to settle on what your teaching forum will be. Where will you be tutoring? Here are a few different types of tutoring businesses:

  • Online Tutoring Business – You can offer online tutoring via Zoom or Skype. Online tutoring businesses are ideal when you are trying to reach a national audience (vs. local clients).
  • Home Based Tutoring Business – You can offer tutoring out of your own home. Make sure you have a good, distraction-free location that is conducive to learning.
  • Office Based Tutoring Business – You can open open a small office to tutor students out of. This may be a better option as you grow your new business and have multiple clients.
  • Flexible Location Tutoring Businesses – Many tutors will go to a client’s home to offer tutoring services. This is often the most convenient option for local clients.

Once again, you should play to your strengths. If you have a strong online presence and/or digital marketing skills, you may consider virtual tutoring. If you have a stronger offline network, you may consider in-person tutoring or small classes.

Taking the time to think through these questions and decide what you want to do will be necessary because it will dictate who you should be marketing your skills to later on

Make Your Tutoring Business Official

How to Start a Tutoring Business Concept

Once you’ve decided who and what you’re going to teach, there are a few things you need to do before you open for business.

If you are serious about your tutoring business, you should treat it like a real business. Sure, you can get away with casual transactions when you start, but if you really want to grow your tutoring business, you need to take it seriously (and you should do so from the start).

Name Your Business

First, the fun part – choose your business name!  You could use your real name or think of something more creative.  It’s your business, so it’s up to you. Your business name should make your service offering clear.

For example, if you are running a test prep service, mention test prep in the name. If you are running a group tutoring service, mention group tutoring in the an,e.

Sole Proprietorship Or LLC

Once you choose a name, it’s time to register a business.

Deciding which type of business you’d like to run will be a particularly important step because it will determine how you want to report your income and business expenses to the IRS and if you need to take any additional steps.

For instance: Do you want to tutor for just a few hours per week here and there where it fits your schedule.  If so, then maybe being a sole proprietorship is right for you.

Perhaps maybe you have more time to commit to tutoring and you really want to develop it into a solid business?  In that case, you may want to take steps to form an LLC (limited liability company).  By the way, LLC’s are a common business structure and don’t take much effort to create.

Other Business Tips

We could write a whole book on starting a business, but we will keep this section brief. Some other considerations when starting a business include:

  • Business Insurance (i.e. general liability insurance to make sure you are covered)
  • Bookkeeping – Make sure to keep track of all of your income and business expenses throughout the year so you can pay your business taxes at the end of the year.
  • Prepare for Taxes – If this is your first time running a business, remember you have to pay taxes at the end of the year (including self employment taxes). Make sure to have money set aside to pay these taxes so you are repared.

Your Credentials

Now that you’ve created your legal business entity, you have a strong foundation to build on. It’s time to focus on marketing strategy.

Put yourself in the shoes of a prospective client and objectively ask yourself: Why should anyone work with you?

Similar to a resume, start putting together a list of any reputable credentials you possess.  This could be any relevant college degrees (including college minors), certifications, training, publications, etc.

Of course, don’t forget to highlight any experience and employment history that you feel is marketable.

Use your credentials and business plan to start shaping your marketing messaging.

Start Your Tutoring Business By Landing Your First Clients

Now that you’re open for business, it’s time to get the word out!

You should have a plan for identifying prospective clients.

  • Who is your ideal client?
  • How will you reach out to these prospective clients?
  • What will your pitch be?

Start by connecting with the people that you believe would best fit your niche.  For example, if you plan to tutor young children, start connecting with teachers and parents at local schools who might know of some kids in need of extra help.

If you don’t already have these connections, then no problem.  Here are some ways you can land your first client:

  • Volunteer in places where you can find potential clients.  Though you won’t be paid for volunteering, it will help you to form personal relationships with the people who would most need your services.
  • Share your business on social media. You don’t need to be a social media marketing guru to start tapping into your social network. Let your friends and family know you are open for business and ask them to spread the word.
  • Create business cards and start passing them out. You can share them with friends, family, teachers, or whoever may help you connect with potential clients.
  • Offer to work for free. This may sound counterinutitive at first, but, remember, your goal is to build a strong tutoring business that thrives in the long-term. Struggling to find your first clients? Offer to tutor students for free. If you are confident in your services, this can help you overcome any objections from prospective clients. You may offer the first tutoring session for free and start charging from there.

Build Your Reputation

Tutoring a kid

Early on, one of the most important things you should be focusing on is to start building your reputation.  A business can grow quickly through word-of-mouth alone.

Positive reviews from satisfied clients are some of the strongest marketing tools you can have in any market.  But to get them, they’re not going to come to you automatically.  Especially if you’re just starting out, many would-be clients will be skeptical of your services without some sort of prior history.

So how do you get positive reviews when you’re just getting started?  By being strategic!  Go above and beyond with your first few clients.  Offer your services at a reduced rate (if you have to) and continue to deliver the same level of high-quality service.  Show them what you’re capable of and what kind of benefit you can provide.  

In return, ask your clients if they can leave reviews or give recommendations.  Generally, if you’ve done an outstanding job, they’ll have no problem helping you out.

Build Your Network

As you’re trying to attract new clients, it will be important to put yourself out there and continue to remind others of your capabilities. 

You could be marketing yourself by doing any number of activities:

  • Post helpful tips to social media
  • Write a blog post
  • Host a free webinar
  • Offer a free give-away (such as a book)
  • Etc.

As you’re doing this, start keeping a list of everyone who reaches out to you.  Even if you can’t work with them now, it’s possible you might have an opening in the near future.

Final Thoughts

If you want to start a tutoring business, now you know how! Starting your own tutoring business will take some work, but it’s definitely doable! Want to learn more about starting a business? You may enjoy our article on the six best books on starting a business.

DJ Whiteside

DJ Whiteside is a financial enthusiast who believes in helping other people to achieve financial independence. He’s constantly looking for practical ways to optimize savings, reduce spending, and create a lifetime of passive income. DJ holds an MBA from the University of Michigan, which allows him to take an analytical approach to financial topics. He has been a financial writer since 2011 and has self-published 5 personal finance eBooks relating to saving, retirement, and financial independence.

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