How Much Can I Make with Sylvan Learning?

Sylvan Learning, the leading provider of personalized education for K–12 students, has been creating rewarding experiences for both students and franchise owners for more than 40 years. Every day, Sylvan owners and staff watch children achieve their goals through newfound confidence, knowledge and skills that will serve them for the rest of their lives. Not only does this offer a fulfilling day-to-day life for these owners, it also offers the potential for high financial returns.

According to its 2022 FDD, the average gross revenue from 308 reporting territories open for at least one year was $364,695.* The highest gross revenue among those 308 locations was a whopping $1,652,866. For the 25 Sylvan Learning territories that were open for at least two years, the average gross revenue jumped to $751,373, with the highest in the category being $1,678,153. For the two Sylvan Learning territories that have been open at least three years, the average gross revenue skyrocketed to $2,270,685.

The scalability of the business can be attributed to several factors, including an increased demand for high-quality and reliable tutoring services following the COVID-19 pandemic. Sylvan’s proven tutoring approach allows franchisees to stand out by blending high-quality teachers with SylvanSync™ technology on the iPad. 

Sylvan also leads the way with Sylvan EDGE (STEM and accelerated courses) and Sylvan Prep (college and test prep courses). Sylvan provides resources for an extensive range of academic disciplines, and the franchise system is the largest national branded provider of STEM and college prep courses. All of these services become lucrative revenue streams that franchisees can leverage to satisfy demand in their market.

Best of all, the potential for those high returns doesn’t require an equally high initial investment. The total investment necessary to begin operation of a Sylvan and SylvanSync business is $85,525–$186,930,** this includes $36,640–$50,140 in fees that must be paid to the franchisor or an affiliate. This puts Sylvan Learning on the lower end of the spectrum when it comes to education franchise costs.

“We make sure to stay below $200,000 for the total initial investment, as we believe that is a reasonable amount of money to invest to become your own boss,” said Jacob Jones, CFO for Sylvan Learning. “You've worked hard all your life, now it's time for you to take control of your destiny, and it's only going to cost less than $200,000. Franchisees can be confident that investment will allow them to run an educational franchise that is backed by technology and can help students on a day-to-day level.” 

According to Jones, this initial investment includes overhead costs such as upfront rent security deposits, small technology fees, furniture requirements, etc. “This is not the type of business where you need a lot of inventory and expensive machines,” he said. “We're talking about furniture for the students and iPads so staff can deliver tutoring. We also spend a lot of time with each franchisee to help them source the necessary equipment and ensure they are getting the best deal possible.”

Jones says Sylvan Learning also keeps its initial investment low due to its smaller square footage requirements. “As long as it's 1,000 square feet, you can open up a Sylvan center and enjoy much lower rent costs than many retail competitors,” he said. “We also spend a lot of time analyzing leases to ensure franchisees are getting a good deal and that their location will put them in the right path to attract more families.”

Additionally, while many franchisors in the segment have a clunky, confusing fee structure, Sylvan offers a transparent, variable cost model, which includes a flat royalty fee of 16% of their monthly gross revenue. The fee includes marketing funds, which includes guidance for building an online presence, social media, public relations, online directory management, creative development, and national and local websites; online and in-person startup and ongoing training resources; student assessments and full-time corporate support. This royalty structure is specifically designed to save franchisees money while increasing their profit margins.

“Our royalty fee is based on what franchisees make — we only get paid when you get paid,” said Jones. “We don't have a lot of one-off fees. We don't have large technology fees, we don't have large monthly training fees. We don't want to hit franchisees with heavy fees that are going to be coming down on you hard every single month. Whether you have a good month or a bad month, the expected royalty payments are driven by the amount of cash that you bring into your center.”

This flexible variable cost model is designed to appeal to several different investor types, Jones says. “If you want to be semi-absentee, open a bunch of centers over a long time and hire a team to run it without you, we can do that through our area development agreement,” he said. “Or maybe you want to be that single center owner because you're a teacher and you're looking to get out of the public school system and become your own boss. We're great for you as well.”

That is why, when going through the financials, Jones says it is important to remember that each Sylvan Learning franchisee has a different experience.

“The maturity point of the business can be around two-and-a-half to three years, but some owners reach that threshold faster and others slower,” said Jones. “The most successful Sylvan franchisees are go-getters — they are out there spending on marketing and connecting to the community. You can really hit the ground running.”

To help ensure Sylvan Learning franchisees reach profitability as quickly and efficiently as possible, Jones says the brand offers world-class support to franchisees before and during the launch of their business, along with ongoing support as their centers thrive and grow. The corporate team, composed of industry executives, longtime Sylvan employees and former franchisees, is incredibly in-tune with what franchisees want and need, and have created the most streamlined systems and processes and a robust pool of resources to help franchisees run their businesses — all designed to drive franchisee profitability.

When doing the due diligence on Sylvan Learning and how much they can make, Jones says prospective owners are encouraged to reach out to existing owners to get the full story on the profitability potential and the timeline of their individual business. “Don’t ever hesitate to call some of our current franchisees, ask questions and learn best practices to bring to your own centers,” he said.

Today, with more than 710 points of presence worldwide, Sylvan’s uniquely rewarding business opportunity is catching the attention of more and more savvy-investors looking to enter the education industry. The brand finished out 2021 with an impressive surge of growth, including 55 new franchise partners, 47 total centers awarded, 29 new openings and six existing-owner expansions for the year. Now, in 2022, the brand is gearing up to open a new center, on average, every other week throughout the year, following its best year of awarding franchises in over a decade.

Start-up costs for a Sylvan Learning franchise range from $85,525-$186,930. Learn more at www.sylvanfranchise.com.

*As reported in Sylvan’s 2022 franchise disclosure document. For full financial information, please see the Item 19.

**As reported in Sylvan’s 2022 franchise disclosure document. For full investment information, please see the Item 7.