Tutoring is one of the businesses that offers simplicity and low overhead costs. If you have ever thought of starting your own tutoring business, keep in mind that it would not only be a lucrative option but also provide stable growth. However, the starting process won’t be that easy but once you get going, your business is likely to flourish.

With the increasing demand for tutors, now is the ideal time to lend a helping hand to students in shaping their future. To learn how to start a tutoring business, fuel yourself with the same passion you have for sharing knowledge with your students.

Here, we have revealed easy steps for launching a tutoring business that can help you reap many benefits.

So, let’s unlock the potential of the tutoring business as we understand how to get off the mark in this step-by-step guide.

Why Do You Need to Start a Tutoring Business?

Post Covid-19, the education industry is facing a real challenge in the form of remote education. While this study-from-home model has not been up to the mark, starting a tutoring business can be a boon for students to re-establish their focus and achieve educational goals.

So, if you are ready to guide students in the right direction following tough times, it’s worth running a tutoring business. After all, this is something you really enjoy doing, right? Then why not convert the passion into a profession that helps you run a money-making business? Another reason is that experienced and knowledgeable tutors have always been in demand regardless of the pandemic coming into effect.

Furthermore, it is a business where you don’t require higher startup costs as you can have flexible working hours and no need for a brick-and-mortar office. You can ask students to come home or meet at libraries rather than occupying office space and paying monthly rent. Also, you can conduct online tutoring classes for those who are comfortable learning from their home, resulting in lower operating costs.

How to Start a Tutoring Business

How to Start a Tutoring Business

When you have made up your mind to launch a tutoring business, here are the steps on how to start a tutoring business from scratch.

1. Create a Business Plan

The first step you should take is to conduct market research to develop a business plan. Prioritize creating a basic layout of how you will manage fixed business expenses and daily teaching sessions before launching the business.

Also, determine whether you are comfortable working from home or if you need a separate office.

While developing your plan, focus on the subjects in which you are an expert as it will make your job much easier. If teaching more than one subject is your expertise, then many clients are likely to join your coaching session.

However, you must ensure a great ability to teach clients and have sufficient study material available to get off the mark.

2. Form a legal business

Of course, you don’t need a license to launch your new tutoring business. But, forming a legal entity is a must when you are planning to start a long-term business driven by your passion.

At this point, decide whether you will go with a sole proprietor or LLC legal structure. A legal identity of business helps you in surviving tax season. You will not only report this new source of income at the time of filing tax returns but also get eligible for tax refund on business expenses such as transportation costs or training materials.

Besides, if you ever thought about why to complete a legal process for tutoring a few clients, then remember you have unfulfilled business goals. This business represents the primary income that you need to report to tax authorities. Hence, it’s better to get rid of this step before moving to the next one.

3. Determine Your Client Base

Next, finalize to whom you will offer your tutoring services. In this process, you must figure out several answers to questions like will you tutor to all grades? Will you start one-on-one tutoring or conduct group coaching sessions?

In simpler words, you need to learn how you will make clients satisfied with newly-introduced services. Nowadays, even student’s parents take an interest in exploring how you tutor their kids to fulfill educational goals.

Therefore, you need to deliver outstanding tutoring services to meet their expectations and win more clients. In addition to that, you can pinpoint high-paying clients like CPA aspirants seeking help from experts like you.

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4. Select a Business Model

Now is the time to pick the business model before you make any investments. Finalizing the business model will decide how you will run your tutoring services.

You can choose online tutoring, home-based tutoring, or tutoring franchises that align with your requirements and expertise.

  • Online tutoring is a preferred model for those who want to connect with clients through group sessions or conduct one-on-one meetings via video.
  • Home-based tutoring works great for tutors planning to run a business from home. You can allot some space inside your home for running coaching sessions.
  • Tutoring franchises offer help to entrepreneurial-minded individuals to serve students in their area. Plus, they provide high-quality resources to scale up their business.

5. Set Up Pricing

Work out details of pricing plans in such a way that it helps you attract more clients and generate sustainable revenue. Sometimes setting up pricing can be not easy because higher prices may lead to a reduced number of clients and low prices may affect your income.

Therefore, you need serious effort to build a pricing strategy, considering both business growth and clientele.

You can offer cost-based pricing to allow your customers to pay only for what actually they avail. For example, you can collect $30 per hour or session as a tutoring fee. Or else, you can come up with a competitive pricing to beat your competitors and attract more clients.

6. Use the Right Tools for Billing Clients

Use the Right Tools for Billing Clients

It doesn’t matter if you tutor a few clients at home or take online group sessions, counting billable hours is something that needs your attention and time. Thankfully, we have advanced invoicing software to get rid of error-prone receipts and invoices.

You can choose accounting software like Moon Invoice to create e-invoices rather than making poorly written handmade invoices.

It aids you in creating professional invoices using a ready-made tutoring invoice template that boosts your chances of getting paid faster.

Since it does not need paper-based invoices, you don’t have to worry about storage space. It is a cloud-based invoicing software that can be used to store unlimited bills.

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7. Market Your Business

When everything is in place, lastly, you need to spread the word regarding your services. For that, there is no better way than using marketing tactics.

Develop a marketing strategy based on your selected business model and targeted audience. Launch your online website to reach potential clients and begin with the consultation process at the initial stage.

Also, you can get your tutoring business listed on Google My Business to boost the business visibility. You can even promote your business on social media to advertise your services and engage in discussions with online users to know their requirements.

So, that was all about how to start a tutoring business. Now, let’s move on to find out how much the startup costs are in the next section.

How Much Does it Cost to Start a Tutoring Business?

The startup cost for a tutoring business lies anywhere between $3,000 to $10,000. You may incur a cost of approx. $10,000 or more if you decide to run your business by purchasing an office space.

However, in case you want to conduct online classes for your students or are comfortable working from home or libraries, then the startup cost will be reduced to somewhere around $5,000. This is because you don’t need to pay extra costs for buying or renting an office area.

Final Words

Now you know how starting a tutoring business is worthwhile and also how to start one from scratch. There will be struggles in the initial stages, but if you provide guidance like no other, you will not only run a profitable business but also help aspirants achieve their dreams.

We hope these above steps will help you embark on this rewarding venture. Following the business expansion, you can identify areas of improvement by collecting their feedback in order to drive business revenue.

Once you have an increased number of clients, managing clients’ bills can become a cumbersome task that you might want to get rid of. That’s where Moon Invoice, an accounting software, comes in to relieve your stress of managing expenses and invoices.

You can instantly create nice-looking invoices using well-designed templates and send them to clients quickly. Try our free trial to experience how it works in real.


Jayanti Katariya
Jayanti Katariya About the author

Jayanti Katariya is the founder & CEO of Moon Invoice, with over a decade of experience in developing SaaS products and the fintech industry. He holds a degree in engineering. Since 2011, Jayanti's expertise has helped thousands of businesses, from small startups to large enterprises, streamline invoicing, estimation, and accounting operations. His vision is to deliver top-tier financial solutions globally, ensuring efficient financial management for all business owners.