After a couple of tough years in 20/21, 2022 has been somewhat of a return to normal for swim schools across the globe.
The biggest challenge for swim schools seemed to be staffing. The impact of pandemic saw a massive shortage of teachers which has impacted the ability to meet demand. This was caused by many teachers moving to other employment during the pandemic, a lack of international students, and a higher degree of absenteeism from sickness including Covid.
As we quickly approach the finish line of 2022 let’s look forward and explore what 2023 may have to offer.
I will start by saying these are my thoughts only so take them with a grain of salt.
Many people predicted that house prices would crash at the start of the pandemic and they went in completely opposite directions so making any predictions always opens you up to being wrong.
I would like to predict a more positive outlook for the immediate future however 2023 could be a tough year for many.
Let’s explore the current realities for a moment.
1. Interest rates are the highest they have been for many years and they continue to go up month after month
2. Inflation seems out of control- approx 7 %+ and this is impacting the cost of living significantly.
3. The costs of some things are further out of control such as energy/gas costs of up 20 plus %
4. These trends look set to continue in the first half of 2023.
What does all of this mean?
1. Pressure will build on wages to keep up with inflation. For many swim schools, staff wages are a significant cost.
2. Some families will be forced to cut non-essential expenses such as kids’ sports which will make it difficult for swim schools to retain customers at the same level
3. The cost of operations will increase from things such as increased heating costs.
4. If you have a business loan or some form of debt in your business you will be facing higher repayments
5. Margins will be squeezed from all of these factors leaving owners with less profit or potential losses.
Some of these points are a little deflating (maybe very deflating) however there is a silver lining.
Crisis often presents opportunities. When the stock market crashes a lot of people make fortunes by taking advantage of undervalued assets.
The same principles apply here.
Yes, many swim schools will likely struggle in 2023 however the good ones will likely rise to the top and potentially take significant market share from competitors.
There may even be opportunities to buy other swim schools if you’re looking to grow.
I think most owners and operators they just want to make sure that 2023 is a good solid year and I think most swim schools can do this by focusing on the right things to maximize their success.
Below I outlined 4 suggestions that I think will help swim school maximize their success in 2023.
1. Greater focus on retention
In my mind- Retention is already king when it comes to running a swim school however this importance will be even greater in 2023.
Make sure retention is your number 1 focus
Make sure you know your retention numbers
Make sure you are implementing as many strategies to improve retention as possible such as providing parents with regular feedback, having an onboarding program, interacting and building relationships, etc.
2. Cut costs by investing in automation
Rising costs will squeeze the margins of swim schools in 2023. Swim schools with clunky processes that require a lot of admin manhours put themselves at greater risk.
We have calculated that the average swim school has over 30 hours of wasted admin time each month that could be automated with the right swim school software program.
If you are using outdated software that is clunky and you have a lot of time-consuming admin processes then you are wasting pressure on revenue that could be deployed more efficiently.
Swim schools that are lean and efficient in 2023 will put themselves in the best position to thrive.
Side note- Many may make the mistake of looking to save money by not investing in their business. If good software costs you a couple of hundred dollars per month but saves you a few thousand per month this is well worth the investment.
Learn more about First Class Software and how it can help save you time, effort and cost.
3. Be prepared
Those who are prepared will be best placed to weather the storm.
If you are prepared you can start taking action now to ensure
What is your customer retention plan for 2023?
Review your expenses and trim off any unnecessary waste.
Is now the time to invest in swim school management software to automate time-consuming tasks and lower admin staff time?
It’s also important to have a financial cushion to absorb any potential greater-than-expected attrition.
Are you putting away the correct amount for your taxes?
Those that are prepared for potentially tougher times will be in the greatest position to capitalise and take market share from competitors.
Make sure you raise your prices. With 7% inflation, the new year is a good time to raise your prices to maintain a good profit margin.
Now is the ideal time to be preparing your customers for a price rise at the start of 2023.
You may feel this may scare some people away and it may be for a small number however it’s important to have a healthy margin to operate at the level required to deliver an outstanding service to your customer base. Ultimately delivering a great service is what will keep people in your program and leads to greater word of mouth.
Despite a potentially tougher environment in 2023, there are still plenty of opportunities to grow and have the best year of your business.
Those that are prepared and put the work into planning for these factors will be best placed to thrive.
Teaching swimming is an important service and helps keeps children safe around water which always makes it a service that many carefully consider before moving on.