Do you want to start a tutoring business by buying Kumon franchise? If YES, here is how much it cost to open a Kumon franchise and their requirement.
Kumon is an individualized learning method that allows each student to study at a comfortable level, regardless of age or school grade, and advance beyond his or her current school grade level. The educational network was created by Toru Kumon, and he uses his Kumon Method to teach mathematics and reading to young students.
When kids advance through the Kumon Math and Reading Program, they develop traits for success such as resilience, perseverance, and vision. No other program creates the same critical lifelong success habits.
Franchisees operate an after-school center that provides math and reading programs using the Kumon Method of learning. Children are given the opportunity to attend Kumon Centers twice each week throughout the year for approximately 20-30 minutes per subject and complete daily assignments at home on non-Center days. There are 20 math levels and 27 reading levels covering materials ranging from pre-school to high school level.
Kumon offers a proven Business model, and by becoming a Kumon franchisee you are establishing a relationship with a successful global company established for 60 years, now operating in 50 countries worldwide. Kumon has over 4 million students and an estimated 25,880 units worldwide.
It takes between three to six months to get a Kumon center up and running, starting from the initial enquiry. These timelines vary depending on location and whether it is a new or existing Kumon study centre.
How to Open a Kumon Franchise
- Join their Franchise Seminar
To open a Kumon franchise, the franchisee is expected to participate in the franchise seminar. You’ll learn what to expect in the franchise process, why Kumon is a smart business choice and about your role as a Kumon Instructor and owner. After the seminar, you’ll complete a short reading, writing and math proficiency assessment.
- Pre-Qualify By Completing the Application
Next, you are expected to send in an application to the Kumon franchise team. They will review your completed application, then your Franchise Recruiter will set up an initial interview by phone.
- Speak With the General Manager
The next stage for you to cross is for you to have a meeting with the company general manager. You’ll schedule this in-depth interview through your Franchise Recruiter.
Kumon will also conduct a financial assessment to confirm that you’ll be able to meet the monetary obligations of opening your franchise. An FBI fingerprint check is required prior to attending training.
- Attend the Instructor Development Program
Here, you are ready for the training process. The Kumon training provides you with hands-on support and guidance to help you set up and run your Kumon Center successfully. You’ll learn about the Kumon Method and the curriculum, conducting parent orientations and Placement Tests, and business and Center management strategies. You’ll also explore possible retail locations for your Center.
This comprehensive program provides two four-day sessions of training held over a two-month period at the Kumon University in Ridgefield Park, New Jersey. You’ll also participate in a series of Center visits for more hands-on training.
- Sign Your Franchise Agreement
Once you have completed the first session of the the training program, and your selected Center location has been approved, you can now sign your Franchise Agreement.
How Much It Cost to Open a Kumon Franchise
Quite a number of fees are applicable if one wants to acquire a Kumon franchise. However, note that all fees are nonrefundable unless otherwise specified and are uniformly imposed on its franchisees.
Initial Franchise Fee
- The Initial Franchise Fee is $1,000.
- Materials: $1,000
- The fee for your purchase of materials you shall need to operate your Kumon Center, such as instruction answer books, student achievement tests, student placement tests, and promotional material, is $1,000.
- This fee will also apply if you are granted a second Center or you are taking over an existing Center.
- If you are applying for your first Kumon Center franchise, the Deposit Fee is $500 for your Training Kit for the Instructor Development Program.
- Kumon will apply the Deposit Fee toward your Initial Franchise Fee if you successfully complete the Instructor Development Program and sign a Franchise Agreement.
- If either you or Kumon cancels the Training Agreement, at your expense, you must return to Kumon the Training Kit and all other material Kumon lent to you in connection with your participation in the Instructor Development Program. Kumon will return your deposit if it receives the training materials within 15 days after the notice of cancellation.
- Initial Enrollment Royalty Fee: for each reporting month, $15 times the number of newly-enrolled students
- Monthly Royalty During Temporary License Period (“TLP”): $38.25 times the number of full-payment students enrolled, and $19.13 times the number of partially exempt and/or prorated tuition students for each Subject-Franchise
Monthly Royalty After Completing the TLP
$34 times the number of full-paying students enrolled, and $17 times the number of partially exempt and/or prorated tuition students for each Subject-Franchise
- You must allow Kumon to make monthly electronic debits to your account equal to the amount you owe it.
- Due Date: Through Electronic Funds Transfer (“EFT”), Kumon will debit your account each month. It currently debits franchisee accounts on the 17th or on the next business day, but it has the right to change that date in its discretion.
- If a student drops out of a Kumon Center and wants to return, the student can return without paying another Initial Enrollment Fee if the student returns within one reporting period (one calendar month). If the student returns after one reporting period, then the student must register again.
- If a student is enrolled in both Subjects, the student is required to re-enroll if he or she is absent for more than one month in both subjects concurrently.
- A $15 Initial Enrollment Royalty Fee is due each time a student registers, unless the student currently is enrolled in at least one subject at your Kumon Center and registers for a second or subsequent Subject.
- You pay Kumon the monthly royalty prescribed in the Operations Manual for each Subject-Franchise. Electronic debits are the only acceptable method for payment of royalties. You must allow Kumon to make monthly electronic debits from your EFT account equal to the amounts you owe it. It will debit your account each month for royalties due from each prior month.
- Kumon can change royalty rates or the monthly due date (or both) at any time on at least 60 days’ notice. If you are unwilling to pay any increased royalty rate, you can terminate the Franchise Agreement on 60 days’ written notice to Kumon. There is no contractual limit on the amount by which Kumon can change the royalty rates.
- The royalty during the TLP is higher than the royalty payable after completing the TLP. If and when you complete the TLP requirements for a Subject-Franchise, the lower royalty for that Subject-Franchise will take effect during the next full reporting month.
- If you underreport students enrolled at your Center and Kumon elects not to terminate your Franchise Agreement, for 3 years, you will pay the higher TLP royalty rate.
- Administrative Fee for Late Payment: 1.5% on the overdue amount each month or $75, whichever is higher
- Due Date: When Kumon debits your account by EFT for a late payment.
- This fee is charged on the monthly statement and paid through EFT.
- You must pay a late fee (“Administrative Fee”) if you do not pay your royalties or any other amounts owed to Kumon by the time it debits your account by EFT each succeeding month.
- The amount of Administration Fee is subject to change in Kumon’s discretion and is included in the Operations Manual.
- The Administrative Fee is due when Kumon debits your account by EFT, and Kumon will charge you an Administrative Fee each month until you pay the past due amounts or sign a promissory note for the balance you owe Kumon.
- Late or Inaccurate Report Fee: $200 for the first month you fail to submit a complete and accurate report on time; $500 for the second month that this occurs; $1,000 the third month that this occurs, with increments of $1,000 per month thereafter.
- Due Date: When Kumon debits your account by EFT for a late or inaccurate submission.
- This fee is charged on the monthly statement and paid through EFT.
- Currently, Kumon also will charge you a Late Report Fee or Inaccurate Report Fee (per Center) for each month that you fail to submit a complete and accurate report on time for any of the following: Instructor B Reports, Student Application Forms, Placement Tests, and Achievement Tests.
- Insufficient Funds: $25 per EFT attempt that has insufficient funds to cover the amount owed
- Due Date: When requested by Kumon.
- Charge covers Kumon’s costs of failed EFT attempts.
$4.32 per Math student per year
- Due Date: When billed by Kumon twice a year.
- You must buy a commercial General Liability Insurance policy, including products liability, with a combined single limit for bodily injury and property damage liability in the minimum amount of $1,000,000 per occurrence and $2,000,000 aggregate.
- You may, if you wish, participate in the insurance program that Kumon makes available through its insurance carrier. If you decide to do so, the current cost for participation in this program is $4.32 per Math student per year.
- If you decide not to buy the package policy liability insurance that Kumon makes available, you must send it a certificate of insurance providing evidence that you have purchased insurance coverage meeting its minimum requirements.
- The certificate of insurance must name Kumon as an additional insured and must provide that the insurance carrier shall notify Kumon at least 30 days in advance of a cancellation of the policy.
- Indemnification: varies
- Under the Franchise Agreement, you agree to indemnify Kumon and hold it harmless from any claim, liability, loss, or expense arising out of your activities as a Kumon franchisee. This means that if Kumon incurs any expenses to handle, settle, or dispute any matter relating to your activities as a Kumon franchisee (including attorneys’ fees, court costs, etc.), Kumon may require you to reimburse it for those costs.
- Shipping Costs for Materials: $36 or actual shipping costs, whichever is less for ground shipping of your initial monthly order
- Due Date: As stated on invoice.
- Other than the initial materials fee, Kumon will provide you with “Kumon Materials” (Placement Tests, Achievement Tests, Worksheets, Record Books, and Progress Charts) reasonably necessary for the operation of your Center at no additional charge; however, you must pay the shipping costs.
- Shipping costs will be charged on a per order basis. Kumon currently bills freight costs at $36 or actual shipping costs, whichever is less for ground shipping of your initial monthly order.
- Shipping costs will be charged to your monthly statement for orders placed within the month.
- Any additional or expedited orders will be charged at cost.
- Relocation Fee: $1,000
- Due Date: When your Center opens at the new location.
- Payable if fewer than 80% of your enrolled students transfer to the new location.
- Kumon has the right to charge you a new franchise fee upon its approval of a request to relocate your Center. Its present policy is to charge this fee if fewer than 80% of your enrolled students transfer to your new Center location; if more than 80% transfer, Kumon does not charge the fee.
- Payments for “Chargeable Items” Purchased From Kumon:varies
- Due Date: As stated on invoice.
- If you wish, you can purchase from Kumon supplemental teaching materials and promotional items for use or sale. These are called “Chargeable Items.”
- Kumon can discontinue the sale of or change the prices for Chargeable Items without notice.
- Liquidated Damages: three times your average monthly royalty in the three months immediately prior to your last day of operating your Center
- Due Date: Immediately upon notice.
- Applies if:
- You terminate your Franchise Agreement voluntarily without giving Kumon the required advance written notice specified in the Franchise Agreement.
- You propose to transfer your Center before Kumon gives you final approval of your candidate, or if it disapproves the candidate, and you fail to resume operating.
- The Franchise Agreement is automatically terminated under the circumstances detailed in the Franchise Agreement.
- You may voluntarily terminate your Franchise Agreement, but you must give Kumon advance written notice. If you fail to provide Kumon the advance written notice required in the Franchise Agreement, you must pay Kumon as liquidated damages an amount equal to three times your average monthly royalty due for the three months immediately prior to your last day of operating your Center.
- Kumon may waive this requirement if it decides your reasons for not following the time periods in the Franchise Agreement are justified.
- Temporary Transfer to Kumon: 10% of the average tuition charged by the 5 Kumon Centers that are closest to your Center, multiplied by the number of students enrolled at your Center for so long as Kumon has assumed operation of the Center(s) and reimbursement of any out-of-pocket costs that Kumon incurs
- Due Date: Each month that it applies.
- If (i) you are absent from your Center without having made provision for the management of your Center during your absence pursuant to the policy contained in Kumon’s Operations Manual; or (ii) are absent without having made arrangements acceptable to Kumon for the operation of your Center in your absence; or ( iii ) you or any of your owners or employees is charged with a crime against children or involving moral turpitude; or (iv) you engage in any conduct that is susceptible of creating a crisis or immediate substantive damage to the Kumon Brand, Kumon has the right (but not the obligation) to take over operation of your Center(s) until you return, a disposition of your case is reached, or until the public relations crisis has ended.
- Kumon will charge you a management fee equal to 10% of the average tuition charged by the 5 Kumon Centers that are closest to your Center multiplied by the number of students enrolled at the Center for so long as Kumon has assumed operation of the Center(s) and will be entitled to reimbursement of any out-of-pocket costs that it incurs for the period it operates your Center.
- Advertising Contribution: at least the minimum amount set forth in the Operations Manual
- Due Date: Annually.
- Currently, Kumon does not require you to spend any minimum amount on advertising your Center, but it recommends that you spend at least $2,400 annually on such advertising.
- Kumon has the right, in its sole discretion, to establish a national advertising fund and/or regional advertising fund for the geographic area in which your Center is located.
- If it does so, it has the right to reallocate all or a portion of any monies that you are required to spend on authorized promotion and marketing of your Center to the applicable fund(s), and you will be required to contribute that amount to the fund(s).
Term of Agreement and Renewal: The length of the initial franchise term is five years. If franchisees are in good standing and have met the requirements for renewal, they can renew the franchise agreement for additional five-year terms.
Eligibility criteria: Please note, to be a Kumon Franchise owner you must have a bachelor’s degree, proof of U.S. citizenship or permanent residency and be available to run your center day-to-day (no absentee owners). In addition to that, you need to meet the liquidity requirements of $70,000 and net worth requirements of $150,000.
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