How much money do you need to open an eikaiwa?

[AssKissinger]

How much do yall figure you better have saved up before opening your own eikaiwa? I'm thinking of giving it a go in my wife's hometown (where we don't live, now). We want to live with her folks so I couldn't do it from my own pad either.

[Taro Toporific]

How much do yall figure you better have saved up before opening your own eikaiwa? I'm thinking of giving it a go in my wife's hometown (where we don't live, now). We want to live with her folks so I couldn't do it from my own pad either.

In one word: gapa takeover.

My orginal Japanese host family ran an eikaiwa for 40 years. They were VERY willing to sell out to retire for a couple of million yen (circa 1998). This is happening all over "aging" Japan now. Like buying any biz, there's a zillion nasty details BUT a takeover of an existing school does save you the endless heartache of incorporation, educational licencing, etc.

Another example is my friend Chuck Roberts ran the Mill Valley School in Sannohashi (S. Roppongi) for 25 years and just closed (he's over 70 now). He would have taken less than 1 million yen for the whole kit-and-kaboodle ...desks, backboards, textbooks, client lists.

So why didn't I jump at either deal? Simple: SALES!?

English schools are all about sales, "connections", fighting NOVA, negative population growth, demographics....it's very little to with teaching ENglish.


New school? Hmmm, I would not try it for under 2 million yen, I'd shoot for at least 6 million.

[silver_blue]

Don't know about the other major chains, but I know that Shane sell franchises, which takes a lot of the hassle out of the selling and getting students. Obviously there's different hassles in terms of having to hire teachers via Shane, use Shane texts, etc. Can't remember how much they were though, 2million maybe, a long time since i thought about it.

[AssKissinger]

I don't want to buy another school. That seems like buying myself.

New school? Hmmm, I would not try it for under 2 million yen, I'd shoot for at least 6 million.

6 million! Why so much? I plan on being the only teacher and my wife will work the desk. All I can see the eikawas provide are a room, some books, a board, a cd player, some flash cards and some markers. What am I missing? Because the students come because they want a foreign teacher and that's me. Taro (or anyone) give it to me straight, what am I missing? If you don't want to embarrass my stupid ass publicly send a pm (either way I don't mind). I don't know crap about business and even less about doing it in Japan.

[Taro Toporific]

... 6 million! Why so much? I plan on being the only teacher and my wife will work the desk. All I can see the eikawas provide are a room, some books, a board, a cd player, some flash cards and some markers. What am I missing?

TISSUE TIME advertising costs mega-zen.
Expect to stuff mailboxes with 10,000 fliers once a month for years---often the response was ZERO on 10,000 eikawa fliers in Toshima-ku. Tokyo.

Yes, you can bootstrap an eikawa from zero but you still need students. If you have 6 to 12 students or housewives already, then you can build on that base. Nasty little kids are the easy students to collect and the worst pain to teach.

Like I said, the thought has crossed my mind but everytime the the housewives couldn't agree on the best days, the students were to sparse, the rugrats were too plentiful....

[Mini_B]

Rent
Utilities
Insurance
Advertising
Fixed Assets (furniture, equip.)
Salaries
Incorporating start up costs (very expensive unless you go for the entrepreneur 1 YEN program...only Japanese without an existing company may apply. Worth looking into.)

Probably a ton that I missed. Being married to a Japanese helps a great deal. Good luck.

[AssKissinger]

We're not going to hire anybody so we don't have to worry about salaries.

Incorporating start up costs (very expensive unless you go for the entrepreneur 1 YEN program...only Japanese without an existing company may apply. Worth looking into.)

This is the kind of information I need to know. It figures there's some catch to make it next to impossible but my wife is Japanese without an existing company. Any links to info about the 'entrepreneur 1 yen program'?

What do yall think insurance costs?

BTW, if you were JPN would you study at The AssKissingerAssassin'sEnglishFunHouse?

Yeah, Taro, I know RugRats are the only way. I've been working for small eikaiwa for years and have seen that kids are the bread and butter steady clientele. It sucks when they're nasty and if they're way over the top I'd toss 'em. Even at other schools I force the REALLY bad one's to quit. That's only like one out of 100 kids. He has to be totally incorrigible. Kids can be fun if take the right frame of mind .

[Taro Toporific]

Incorporating start up costs (very expensive unless you go for the entrepreneur 1 YEN program...only Japanese without an existing company may apply. Worth looking into.)

I think the entire 1 YEN program was planned as an April Fools last year. It's best to ask the well-meaning but often dim JETRO at http://www.jetro.go.jp

See also Incorporation SURVIVAL TIPS


[url=http://216.239.57.104/search?q=cache:ghS3ZdPTPyIJ:[url]www.stade.ihk24.de/STDIHK24/STDIHK24/produktmarken/international/export/aktuelle_informationen/japan-newsletter.pdf+japan+%22one+yen+corporation%22&hl=en&ie=UTF-8]One[/url] Yen Corporation[/url]

To increase the number of entrepreneurs in Japan, the "Small and Medium Sized Companies Challenge Supporting Law" has introduced a temporary exemption from the minimum capital requirements for corporations.

Effective February 1, 2003, Japanese or foreign individuals who are not already conducting a business may establish a so-called "Confirmation Company" (kakunin gaisha). Entrepreneurs who want to set up a Confirmation Company have to submit to the Ministry of Economy, Trade and Industry a business plan covering the first two business years and apply for the Confirmation Company status. After receiving the confirmationfrom the Ministry (hence the name Confirmation Company), the entrepreneur may establish a corporation in the form of a private limited liability company(yugen gaisha) or a stock corporation (kabushiki kaisha).

Instead of the usually required statutory minimum capital of 3 million Yen (for a yugen gaisha) or 10 million Yen (for akabushiki kaisha), respectively, the capital is discretionary and may be as little as one Yen.Confirmation Companies must submit annually to the Ministry of Economy, Trade and Industry theirbalance sheets, profit and loss statements, and resoltions regarding the distribution of profits. Thesedocuments will be open to public inspection.

A Confirmation Company may only distribute profits if itsnet assets cover the statutory minimum capital (3 or10 million Yen, respectively). At the end of five years, Confirmation Companieshave the option to increase the capital to the regular minimum capital, transform the corporation into apartnership, or dissolve the corporation.

Page 99 JAPAN NEWSLETTER
No. 01 2003

[AssKissinger]

Thanks a lot for the info, Taro.