Brexit looming, political uncertainty, and a changing business landscape have all contributed to a downturn which started in 2016 and led to a “dire” first half of 2019, Loren explained.
“The basic reason is that we’re not getting enough bookings,” she said. “I think it’s a perfect storm of causes.”
“It’s extremely hard to be a small independent school”
Brexit, Loren commented, “hasn’t helped.”
“I think the uncertainty made parents very wary of sending,” she explained, adding that one of the agents working as part of a language centre in a university abroad was told not to send anybody to the UK this year if they were getting funding.
“The university didn’t want to send anyone to the UK in case Brexit happened and they couldn’t get their fees paid by the government or EU,” she said.
“That’s probably happened in other agencies as well.”
Beyond Brexit, other factors have contributed to making business unsustainable for small language schools.
One of them is that the inevitable rise of chains with larger resources is pricing smaller schools out of the market, Loren explained.
“Some of the chains are using [profits from other markets] to give discounts to students coming to the UK, and to the agents,” she said.
“I think some of the chains may have a marketing plan of putting as many independents out of business as possible.”
Another element in the mix is rising agents’ commission. Loren recalled arranging a transfer to another school for a student due to start in the autumn: the student had been given a 20% discount, and 30% of the remaining fee went to the agent.
“So it’s 50% of the fees. When you are a small school you just cannot make those kinds of offers,” she explained
“We might have been the first high-profile school to go, but we won’t be the last… it’s extremely hard to be a small independent school,” Loren said.
“It’s a shame, I will miss the industry. There are so many great people in our industry!”
The school is due to close next week, on the day it turns 30 years old. A party is being planned to mark the event. “I don’t believe in going quietly,” Loren concluded.