E-learning Business Plan for starting your own business

If there’s one thing we’ve learned from the COVID-19 pandemic, that is, we can do a lot more from home than we previously thought. We are presenting this business plan for educational services from home. This is the right time to get started with an e-learning business as people are still reluctant to go out.

If you want to know how to set up and elearning course, you are in the right place. Just like a business plan for a driving school or a business plan for language school, this one is based on an actual start up. Let’s see the components of strategy that will help Smart E-learning School succeed.

Executive Summary

2.1 The Business

Smart E-learning School will be owned and headed by Hazel White. The school will be focused on providing technical education via the internet and distant learning. The courses offered by the school will be about computer, languages, and programming. starting a e learning business is easier than you think. It is just like a preschool business plan but everything is online.

2.2 Management of E-Learning Business

If you are looking for an answer to how to start e learning business, here it is. The business will be headed by White and she will hire specialists of each field to help her plan how to set up online training courses in such a way as to make the maximum profit. A mobile application business plan will also be needed to make the business available for all.

2.3 Customers of E-Learning Business

The customers of Smart E-learning School will be from all geometrographic geographic subdivisions from all over the US. The main customers of the business will be:

  • People looking to acquire new skills.
  • People wanting to learn new languages.
  • People interested in learning photography and videography.
  • College graduates wanting to get safety and other certifications.

2.4 Business Target

The subjective target of this business is to create a reputable name in the elearning industry. However, we’ve set the following objective targets:

  • Enroll 5,000 students within the first 6 months.
  • Generate a revenue of $0.3 million per annum by the end of year 3.
  • Expand to the global market by the end of year 2.

E-Learning Business Plan - 3 Years Profit Forecast

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Company Summary

3.1 Company Owner

Hazel White will be the owner and CEO of Smart E-learning School. White has worked as an educationist for 30 years. She previously implemented a tutoring business plan with success. That makes her the perfect person to implement this e learning business plan sample.

3.2 Why the E-learning business is being started

After the coronavirus pandemic, people have realized that it is cost and time effective to learn from home than going to a school. The greatest evidence of this is the increase in the use of services like Google Classroom and Zoom. This is be best time to start e learning business.

3.3 How the E-learning business will be started

Step1: Planning

The first step towards successfully launching this business is business model for e learning is planning. The managemental hierarchy of the business will be developed and online education e learning sample business plan implementation strategy will be finalized. This is not as simple as a martial arts business.

Step2: Developing a Brand

The next step towards starting the business will be establishing a brand. Top-ranking educationists will be hired to create an impression of the brand. Just like a martial arts business plan it is important to have a brand.

Step3: Establish a Web and Physical Presence

Once the brand has been established, the next step will be to hire office space to start the work. An extensive website will be launched to make the business accessible for customers.

Step4: Promote and Market

The next step will be to create a strong marketing strategy to help the business get noticed by the customers.

E-Learning Business Plan - Startup Cost

Start-up Expenses  
Legal $254,600
Consultants $0
Insurance $31,000
Rent $29,000
Research and Development $26,000
Expensed Equipment $53,000
Signs $4,000
TOTAL START-UP EXPENSES $397,600
Start-up Assets $340,000
Cash Required $356,000
Start-up Inventory $52,000
Other Current Assets $210,000
Long-term Assets $260,000
TOTAL ASSETS $1,218,000
Total Requirements $1,615,600
START-UP FUNDING
Start-up Expenses to Fund $397,600
Start-up Assets to Fund $1,218,000
TOTAL FUNDING REQUIRED $1,615,600
Assets
Non-cash Assets from Start-up $1,610,000
Cash Requirements from Start-up $361,000
Additional Cash Raised $55,000
Cash Balance on Starting Date $36,000
TOTAL ASSETS $2,062,000
Liabilities and Capital
Liabilities $30,000
Current Borrowing $0
Long-term Liabilities $0
Accounts Payable (Outstanding Bills) $45,000
Other Current Liabilities (interest-free) $0
TOTAL LIABILITIES $75,000
Capital
Planned Investment $1,615,600
Investor 1 $0
Investor 2 $0
Other $0
Additional Investment Requirement $0
TOTAL PLANNED INVESTMENT $1,615,600
Loss at Start-up (Start-up Expenses) $371,400
TOTAL CAPITAL $1,987,000
TOTAL CAPITAL AND LIABILITIES $2,062,000
Total Funding $1,615,600

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Services

The next thing that needs to be addressed in this e learning business plan template are the services. If you want to start your own e learning business, you need to determine the services.

Smart E-learning School will be focusing on 20 services divided into 4 categories:

1. Basic Freelance Skills Training

This category will teach people the basic level and easy freelancing skills that they can use to make money. This will include:

  • Freelance writing.
  • Content creation.
  • SEO.
  • Data entry.
  • Use of popular word processors

2. Advanced Freelancing Skills Training

This head will cover specialized skills that can be used for freelancing as well as office jobs. These will include:

3. Languages

We will also be teaching people languages that can increase the chances of them getting better employment opportunities. Smart E-learning School will teach:

  • Entry level Chinese.
  • Intermediate Spanish.
  • Advanced English.
  • Intermediate French.
  • Advanced Spanish.

4. Advanced Skills

These will include:

  • Photography.
  • Videography.
  • Welding.
  • Automotive repair.
  • Surveying.

Marketing Analysis of E-learning Business

If you want to know how to start e learning business online, you need to conduct marketing analysis. This is the part where we determine the economic viability of the project.

Start-Up Visa Business Plan

As of 2019, there are more than 31,000 elearning companies in the US. The market capitalization of the elearning industry was 144 billion USD in 2019. It has been growing ever since at a rate of 14.4% annually and is expected to be worth more than 370 billion USD by 2025.

If you want to start your own e-learning business pdf, you’ll need to come up with an innovative approach. However, the COVID situation has made things easier. People now prefer to learn via elearning rather than attending an actual school.

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One of the most profitable customer bases for any e learning business model are small to medium enterprises. These companies want to get their employees trained at the lowest possible cost. That is only possible through elearning. This enables the employees to receive training while they are in the office and they do not have to take a leave for it.

Another thing that you need to take care of while planning to start an elearning business is the availability of teachers. If you want to succeed as a new entrant in the industry, you’ll need to hire the best teachers. The best teachers and trainers in the territory are the people who can make the business a success for you.

You also need to look into the way others in the same industry are operating. The way they teach, examine, and certify their students are some of the very important things to get inspiration from.

5.1 Market Trends

As stated earlier there are more than 31,000 elearning businesses in the US. The market, however, has not always been like this. There were only a handful of distant learning companies operating in the US before the widespread use of the internet. These companies taught through distant lectures on dedicated TV channels and conducted examinations in large cities.

Since the 2000s, the industry started to bloom. It had a growth rate of 7% in 2002. The number and magnitude of elearning businesses kept going up and the growth rate accelerated over the years. The industry still has a 14.4% growth rate meaning that new entrants still have a chance.

5.2 Marketing Segmentation

In this business writing e learning we’re listing the expected customers of Smart E-learning School:

E-Learning Business Plan - Marketing Segmentationt

5.2.1 People Looking for Skills to Earn

One of the main customers/students of any elearning setup are the people who are looking for a cost-effective way to acquire skills. This segment will makeup the bulk of independent customers at Smart E-learning School.

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5.2.2 People Looking to Learn Languages

A substantial portion of the students at Smart E-learning School will be the ones looking to learn new languages. These people will be the high paying ones as language education is expensive.

5.2.3 People Learning Skills as Passion

People also go to elearning schools to learn things they are passionate about. We’ll teach photography and videography to such people. However, people can also learn the same for earning money. We don’t judge anyone at Smart E-learning School.

5.2.4 Small to Medium Enterprises

We will also be providing online training solutions for the companies that cannot have their own training wings. This will make up the largest single market segment by revenue as such clients often need training for a lot of people.

Market Analysis
Potential Customers Growth Year 1 Year 2 Year 3 Year 4 Year 5 CAGR
People Looking for Skills to Earn 41% 45,000 47,000 48,000 49,000 50,000 10.00%
People Looking to Learn Languages 21% 30,000 31,000 32,000 33,000 34,000 10.00%
People Learning Skills as Passion 20% 28,000 29,000 31,000 32,000 34,000 10.00%
Small to Medium Enterprises 18% 20,000 21,000 22,000 23,000 24,000 11.00%
Total 100% 123,000 128,000 133,000 137,000 142,000 10%

5.3 Business Target

  • To establish Smart E-learning School as a leading distant learning services provider.
  • To make some permanent corporate clients and sign long-term training contracts with them.
  • To start making $26,000 a month by the end of year 3.
  • To maintain a CSAT score of more than 90%

5.4 Product Pricing

All courses and training programs will be priced as per the competitors. The prices will be kept a little bit lower than competing businesses to earn clients at the start.

Marketing Strategy of E-learning Business

Any questions? Get in Touch!

In order to start a successful business any business e learning marketing plan sample must contain a solid marketing strategy. As the elearning market is a saturated one, a lot depends on how well we present the business.

If you have come this far looking for how to start a e-learning business proposal, you need to know the importance of an effective marketing strategy. We need to highlight the areas where we are stronger than our competitors. Only then we can succeed.

6.1 Competitive Analysis

  1. We will implement modern learning techniques to make our trainings better than what the competition has to offer.
  2. We will be hiring the top-notch professionals of every field to make sure we deliver the best.
  3. We will design innovative training solutions for small to medium enterprises to get permanent clients.

6.2 Sales Strategy

  • We will use TV commercials, Google Ads, and banners to promote our nascent brand.
  • We’ll offer discounts in the first 6 months to attract people and advertise the business in turn.
  • We’ll make specialized plans for corporate clients

6.3 Sales Monthly

E-Learning Business Plan - Sales Monthly

6.4 Sales Yearly

E-Learning Business Plan - Sales Yearly

6.5 Sales Forecast

E-Learning Business Plan - Unit Sales

Sales Forecast      
Unit Sales Year 1 Year 2 Year 3
Basic Freelance Skills Training 41,000 43,460 46,068
Advanced Freelancing Skills Training 40,000 42,400 44,944
Languages 32,000 33,920 35,955
Advanced Skills 12,000 12,720 13,483
TOTAL UNIT SALES 125,000 132,500 140,450
Unit Prices Year 1 Year 2 Year 3
Basic Freelance Skills Training $50.00 $58.00 $67.28
Advanced Freelancing Skills Training $60.00 $69.60 $80.74
Languages $56.00 $64.96 $75.35
Advanced Skills $62.00 $71.92 $83.43
Sales
Basic Freelance Skills Training $2,050,000.00 $2,520,680.00 $3,099,428.13
Advanced Freelancing Skills Training $2,400,000.00 $2,951,040.00 $3,628,598.78
Languages $1,792,000.00 $2,203,443.20 $2,709,353.76
Advanced Skills $744,000.00 $914,822.40 $1,124,865.62
TOTAL SALES $6,986,000.00 $8,589,985.60 $10,562,246.29
Direct Unit Costs Year 1 Year 2 Year 3
Basic Freelance Skills Training $47.00 $53.00 $61.00
Advanced Freelancing Skills Training $58.00 $66.00 $76.00
Languages $54.00 $60.00 $70.00
Advanced Skills $60.00 $68.00 $78.00
Direct Cost of Sales
Basic Freelance Skills Training $1,927,000.00 $2,303,380.00 $2,810,123.60
Advanced Freelancing Skills Training $2,320,000.00 $2,798,400.00 $3,415,744.00
Languages $1,728,000.00 $2,035,200.00 $2,516,864.00
Advanced Skills $720,000.00 $864,960.00 $1,051,689.60
Subtotal Direct Cost of Sales $6,695,000.00 $8,001,940.00 $9,794,421.20

Personnel plan

The next step for this business plan for e learning company is making a list of people needed to effectively run the company. One thing that must be noted here is that this business is unique. It will be needing both administrators and teachers to run.

7.1 Company Staff

  • Hazel White will be the owner of the company.
  • 1 Manager Liaison will be needed to connect with the outside world.
  • 4 Language Teachers will be needed, one for each language being offered.
  • 7 Skills Teachers will be needed for all the subjects being offered.
  • 1 IT Expert will be hired to make sure the website runs smooth.
  • 1 Social Media Manager to manage the much-needed social presence of the school.
  • 1 Accountant
  • 1 Technician to upkeep technical equipment.
  • 1 Receptionist

7.2 Average Salary of Employees

 Personnel Plan      
Year 1 Year 2 Year 3
Manager Liaison $14,000 $15,400 $16,940
Language Teachers $35,000 $38,500 $42,350
Skills Teachers $76,000 $83,600 $91,960
IT Expert $8,000 $8,800 $9,680
Social Media Manager $9,000 $9,900 $10,890
Accountant $9,000 $9,900 $10,890
Receptionist $7,000 $7,700 $8,470
Technician $8,000 $8,800 $9,680
Total Salaries $166,000 $182,600 $200,860

Financial Plan

The final part of this e learning business case will tell how much capital will be needed to start the business. This will cover the amount of money that is needed from the way the execution of the business is started to the day it starts breaking even. Here are some of the costs that must be taken into consideration:

  • The rent of the place to set up the business in.
  • The amount needed to purchase office equipment.
  • The money needed to set up and online portal for the school
  • Marketing and publicity expenses.
  • Money required to pay the employees before the company starts generating revenue.

8.1 Important Assumptions

 General Assumptions      
Year 1 Year 2 Year 3
Plan Month 1 2 3
Current Interest Rate 8.21% 8.27% 8.30%
Long-term Interest Rate 8.34% 8.40% 8.47%
Tax Rate 23.33% 24.40% 25.10%
Other 0 0 0

8.2 Break-even Analysis

E-Learning Business Plan - Break-even Analysis

 Break-Even Analysis  
Monthly Units Break-even 5339
Monthly Revenue Break-even $131,330
Assumptions:
Average Per-Unit Revenue $237.00
Average Per-Unit Variable Cost $0.62
Estimated Monthly Fixed Cost $162,390

8.3 Projected Profit and Loss

 Pro Forma Profit And Loss      
Year 1 Year 2 Year 3
Sales $6,986,000 $8,589,986 $10,562,246
Direct Cost of Sales $6,695,000 $8,001,940 $9,794,421
Other $0 $0 $0
TOTAL COST OF SALES $6,695,000 $8,001,940 $9,794,421
Gross Margin $291,000 $588,046 $767,825
Gross Margin % 4.17% 6.85% 7.27%
Expenses
Payroll $166,000 $182,600 $200,860
Sales and Marketing and Other Expenses $132,000 $131,000 $133,000
Depreciation $2,240 $2,298 $2,403
Leased Equipment $0 $0 $0
Utilities $2,800 $2,900 $3,190
Insurance $2,000 $2,090 $2,200
Rent $2,900 $3,000 $3,200
Payroll Taxes $29,000 $30,000 $31,000
Other $0 $0 $0
Total Operating Expenses $336,940 $353,888 $375,853
Profit Before Interest and Taxes ($45,940) $234,158 $391,972
EBITDA ($45,940) $234,158 $391,972
Interest Expense $0 $0 $0
Taxes Incurred ($9,188) $46,832 $78,394
Net Profit ($36,752) $187,326 $313,578
Net Profit Monthly

E-Learning Business Plan - Profit Monthly

8.3.2 Profit Yearly

E-Learning Business Plan - Profit Yearly

8.3.3 Gross Margin Monthly

E-Learning Business Plan - Gross Margin Monthly

8.3.4 Gross Margin Yearly

E-Learning Business Plan - Profit Yearly

8.4 Projected Cash Flow

E-Learning Business Plan - Projected Cash Flow

 Pro Forma Cash Flow      
Cash Received Year 1 Year 2 Year 3
Cash from Operations
Cash Sales $59,000 $63,720 $68,818
Cash from Receivables $19,000 $20,520 $22,162
SUBTOTAL CASH FROM OPERATIONS $78,000 $85,020 $91,822
Additional Cash Received
Sales Tax, VAT, HST/GST Received $0 $0 $0
New Current Borrowing $0 $0 $0
New Other Liabilities (interest-free) $0 $0 $0
New Long-term Liabilities $0 $0 $0
Sales of Other Current Assets $0 $0 $0
Sales of Long-term Assets $0 $0 $0
New Investment Received $0 $0 $0
SUBTOTAL CASH RECEIVED $78,000 $86,000 $92,000
Expenditures Year 1 Year 2 Year 3
Expenditures from Operations
Cash Spending $32,000 $35,000 $38,000
Bill Payments $19,000 $21,000 $22,000
SUBTOTAL SPENT ON OPERATIONS $51,000 $56,000 $60,000
Additional Cash Spent
Sales Tax, VAT, HST/GST Paid Out $0 $0 $0
Principal Repayment of Current Borrowing $0 $0 $0
Other Liabilities Principal Repayment $0 $0 $0
Long-term Liabilities Principal Repayment $0 $0 $0
Purchase Other Current Assets $0 $0 $0
Purchase Long-term Assets $0 $0 $0
Dividends $0 $0 $0
SUBTOTAL CASH SPENT $52,000 $56,160 $60,653
Net Cash Flow $15,000 $16,000 $17,000
Cash Balance $23,000 $24,000 $25,000

8.5 Projected Balance Sheet

 Pro Forma Balance Sheet      
Assets Year 1 Year 2 Year 3
Current Assets
Cash $266,000 $297,920 $327,712
Accounts Receivable $23,000 $25,760 $28,954
Inventory $4,300 $4,816 $4,900
Other Current Assets $1,000 $1,000 $1,000
TOTAL CURRENT ASSETS $281,000 $314,720 $353,745
Long-term Assets
Long-term Assets $10,000 $10,000 $10,000
Accumulated Depreciation $19,000 $21,280 $23,940
TOTAL LONG-TERM ASSETS $26,000 $29,120 $32,760
TOTAL ASSETS $295,000 $330,400 $371,700
Liabilities and Capital Year 4 Year 5 Year 6
Current Liabilities
Accounts Payable $18,700 $20,944 $23,541
Current Borrowing $0 $0 $0
Other Current Liabilities $0 $0 $0
SUBTOTAL CURRENT LIABILITIES $15,500 $17,360 $19,513
Long-term Liabilities $0 $0 $0
TOTAL LIABILITIES $13,900 $15,568 $17,498
Paid-in Capital $29,000 $30,000 $30,950
Retained Earnings $52,300 $57,007 $62,708
Earnings $188,000 $204,920 $225,412
TOTAL CAPITAL $280,000 $305,200 $335,720
TOTAL LIABILITIES AND CAPITAL $293,900 $330,400 $371,700
Net Worth $291,000 $317,190 $348,909

8.6 Business Ratios

 Ratio Analysis        
Year 1 Year 2 Year 3 INDUSTRY PROFILE
Sales Growth 7.25% 8.03% 8.90% 3.00%
Percent of Total Assets
Accounts Receivable 9.31% 10.32% 11.43% 9.80%
Inventory 5.49% 6.08% 6.74% 9.90%
Other Current Assets 2.19% 2.43% 2.69% 2.40%
Total Current Assets 150.03% 151.00% 152.00% 158.00%
Long-term Assets 11.36% 11.44% 11.57% 12.00%
TOTAL ASSETS 100.00% 100.00% 100.00% 100.00%
Current Liabilities 4.96% 5.00% 5.05% 4.34%
Long-term Liabilities 0.00% 0.00% 0.00% 0.00%
Total Liabilities 7.61% 7.67% 7.74% 7.38%
NET WORTH 101.02% 101.83% 102.76% 110.00%
Percent of Sales
Sales 100.00% 100.00% 100.00% 100.00%
Gross Margin 95.07% 97.64% 100.37% 99.00%
Selling, General & Administrative Expenses 95.00% 97.57% 100.30% 97.80%
Advertising Expenses 1.70% 1.75% 1.79% 1.40%
Profit Before Interest and Taxes 42.10% 43.24% 44.45% 33.90%
Main Ratios
Current 34 35 36 32
Quick 34 34.6 35.465 33
Total Debt to Total Assets 0.17% 0.18% 0.17% 0.40%
Pre-tax Return on Net Worth 76.30% 77.00% 77.10% 75.00%
Pre-tax Return on Assets 93.43% 94.88% 99.62% 111.30%
Additional Ratios Year 1 Year 2 Year 3
Net Profit Margin 33.21% 34.24% 35.30% N.A.
Return on Equity 55.80% 57.53% 59.31% N.A.
Activity Ratios
Accounts Receivable Turnover 7.7 7.8 7.8 N.A.
Collection Days 100 100 100 N.A.
Inventory Turnover 32 33.6 34 N.A.
Accounts Payable Turnover 15.8 16 16.8 N.A.
Payment Days 27 27 27 N.A.
Total Asset Turnover 2.4 2.5 2.6 N.A.
Debt Ratios
Debt to Net Worth -0.04 -0.03 -0.04 N.A.
Current Liab. to Liab. 1 1 1 N.A.
Liquidity Ratios
Net Working Capital $239,000 $252,384 $266,518 N.A.
Interest Coverage 0 0 0 N.A.
Additional Ratios
Assets to Sales 0.86 0.87 0.88 N.A.
Current Debt/Total Assets 1% 0% 0% N.A.
Acid Test 29.3 29.4 29.6 N.A.
Sales/Net Worth 2.1 2.3 2.3 N.A.
Dividend Payout 0 0 0 N.A.

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