Getting paid what you’re worth

In university, we joked that if any of us were going into a career for the pay cheque we wouldn’t have chosen teaching.  And, it is true that an education degree gets you among the lowest pay cheque of the professional degrees.  Yet, we fulfill so many roles beyond just teaching concepts.  So, how do we, as teachers, get paid what we are worth?  In fact, what is that magical number?

It isn’t an easy question to answer, nor will one answer fit all.  After all, IMT’s (independent music teachers) do not exist in a vacuum.  We need to factor in other IMT’s in our area, other extra-curricular activities available to our students, & economic climate in order to determine the fair market value of our services.  And that changes depending on where you live & even what has happened over the course of the previous years.  For example, a prolonged recession & high unemployment rates mean that while you may want to charge $100/hr, the market may not be able to support that decision.  Sure, there will be people who can afford it … but if you want a large studio that is continually growing it may not be your best option.  Only time will tell.  However, I can tell you that comparing your prices to other professions is counter-productive.

When I began my business, I spent 5 months researching before I even began advertising.  Below is my guide to how I researched the IMT market in my area AND how I used that information to make an informed choice regarding tuition pricing.  Starting in January, I will be conducting research again to ensure that my choices for upcoming tuition pricing will be sound.  I hope that this guide will help you as well.  It’s a long post, but I promise it will be worth it in the end!

Determining your competition

Who is your ideal market?  If it is children (toddler through teen), there are many choices that parents can make regarding their children’s extra-curricular activities.  As much as we love music, the reality is that it probably won’t be as big of a priority to the parents of our students.  (Important, yes.  But, remember they didn’t choose this as their life work.)  So, when writing down your competition keep in mind the list goes beyond other IMT’s.  Our competition includes:

  • Piano teachers your area providing studio only, in-home only, & a combination of studio or in-home lessons.
  • Sports programs: private &  community based
  • Arts programs (including dance & other creative outlets):  private & community based
  • Community Centre:  Get a range & average prices of programming available at each centre.  I divided this into athletic & arts programming.
  • Camps:  summer & school breaks
  • Academic programs (i.e. Kumon, Sylvan): commercial & private tutors … this will be new this year, but is something I have noticed a group of my students are enrolled in as well.

Get ready to embrace your inner phone addict

Once you have a list, it is time to start calling & emailing.  This was the most exhausting part of the process.  I filled out a Market Research Chart as I called, and called, and called some more.  I looked in the physical phone book & online for businesses that fit my criteria from above.  When calling IMT’s, I was looking for information on:

  • Price for 30 & 60 minute lessons, or monthly tuition fee
  • In-home lesson, studio lessons, or combination
  • Were lesson times available during the school day, or weekend
  • Books & materials:  provided by teacher or student
  • Does the person or company have a website?
    • Does it look professional?
    • Is it easy to navigate?
    • Is it informative for students &/or parents?
  • Registration &/or materials fee (annual or one-time)
  • Professionalism:  Was the person who answered my call:
    • Knowledgeable
    • Polite & personable
    • Answered with company name
    • Willing to share information
    • If I left a message, how soon did they call back (or, did they even bother calling back)?
  • Method used:  a particular series (i.e. Alfred’s, Piano Adventures), or a combination of resources
  • Exams:  required part of enrollment or up to the student

If the person was antagonistic, I still collected & used the information but wrote them off as not being competition since there was no way I would have EVER hired them to teach my kids.  Sadly, there were quite a few people & companies who didn’t make my list of competition because they couldn’t be bothered to use a business line, return a call or were rude.  Others were amazing & I took note of what made me want to know more about them.  These were things I took to heart & learnt from when I was organizing what I needed to have in place for my business.

Going back to statistical analysis class

I remember taking a learning assessment & statistical analysis class in university.  Our poor professor LOVED math … and got stuck with all the arts majors for this education class.  Bless his heart, he attempted to instill a love of math in us but it was an uphill battle.  However, I do need to thank him for teaching me the basics of how to analyze groups of data to determine validity & what on earth the data was actually telling me (rather than what I wanted it to tell me).

So, here is the down & dirty of what you need to know.

  1. Group apples with apples.  This means grouping your research into sections:  athletics, arts, academic, IMT’s (in-home & studio separated).  Use the sections that work for you & came up in your research.  Perhaps on-line lessons is an avenue you researched.
  2. Determine the average prices (based on time length), range of prices & your outliers.
    • Get to an hourly rate for everything so you can compare using the same unit of time … divide or  multiply as necessary to get this number (i.e. monthly tuition for 30 minute lessons is $125 will work out to $62.50/hr … looking for basic number, not to the hundredth decimal place like my professor).
    • Most of your data will group around a range of pricing.  But, outliers are your much higher or much lower cost programming.  Determine the average with AND without the outliers to get a true sense of what your data is telling you.
  3. What generalities or patterns do you see in the average, range & outliers?
    • If the range is really big, what sets apart the lowest part of the range from the highest?

What does the market say my lessons are worth?

This is where things get a bit tricky.  None of us truly want to be known as the budget-friendly teacher … we want to be known as the best teacher.  So, what are the variables that set YOU apart from others?

  • Education:
    • Do you have a music/education degree or instrument lessons only?
    • Have you continued annual professional development?
  • Experience:
    • Are you taking on your very first students or have you been teaching for years?
  • Programming:  The following may allow you to charge more:
    • provide in-home lessons
    • provide materials for students
    • include technology in lessons (or between lessons)
    • support between lessons

The above list is not exhaustive by any means.  The more variables you can provide that match up or are similar to IMT’s in your high range, the better argument you have for charging similar prices, which helps you sell yourself more effectively.

The end result … full studio of happy clients

While the above method takes quite a bit of time, it is well worth the effort.  You can confidently advertise your services &, hopefully, understand the pitfalls you discovered from others in your research.  Better to base your pricing on what your market dictates, rather than a number you choose that may hurt your business.

If you are just starting out, an idea would be to START at the lower end of the range. OR, perhaps you have low tuition prices & would like to increase tuition rates to reflect your research.  There is a way to do this without losing all your clients & having to start from scratch.

In your enrollment information, state that tuition rates may increase from one year to the next.  This gives your clients the heads up that as you increase your skills, they will be paying more each year.  Plus, a small tuition raise each year is much easier to budget for than a sudden jump.  Within a few years, your tuition pricing will probably reflect the higher range of numbers you discovered in your research.  And, you will have lost minimal, if any, clients in the process.

Happy researching & I hope that this guide will help you get paid what you are worth!

For more information on setting tuition rates, I recommend reading the Wendy Steven’s blog posts on How to Increase Tuition (Without a Revolt).

To get a IMT Market Research template, click here.

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