Saturday, 13 December 2008

Is becoming an instructor a good way to spend your redundancy?

There's been a massive increase in people searching for a few worrying things since the start of the credit crunch, though at least a few have got their heads screwed on, as we keep turning up for "driving instructor earnings".

Unfortunately though, we also seem to turn up far more often for searches for training with the big providers.

All we can say is - if you read what they tell you, then remember that EVERYTHING they say is designed to get you to buy their product. Even the ones who are "honest" about the business still want you to buy.

At the moment the reality is not good. Just have a look in your local paper - driving instructors are giving stuff away cheaper than Woolworths - for exactly the same reasons. They're going under and are desperate to get money in.

The simple facts mean that any driving instructor who is charging less than £10/hour is losing money. Actively GIVING MONEY AWAY in the hope that they will bring in work and that those people who feel that £10 should be the hourly rate for an instructor will stay with them when they put their prices up to £17/hour.

Fact is they won't.

The REALLY scary bit is this - the people trying to flog you instructor training will then expect you to put up with this kind of thing when you are a franchisee -

  1. Surepass have a really STUPID OFFER, which makes you wonder whether this major driving instructor training provider has enough work for it's instructors.
  2. Bill Plant are also guilty of idiotic irony, on this page which shows a load of ridiculous offers, desperate to drag work in, yet still has the brass neck to suggest "INSTRUCTORS URGENTLY REQUIRED"!!!! Must be frickin joking.
  3. Or the wonderful irony of Passmasters page with (in their words) "slashed prices" on the same site as the page offering a "guaranteed position" but remember, this is NOT A JOB, this is a guarantee that they will let you become a customer and pay them a franchise - talk about positive spin!!
(These links will be removed soon as I don't like giving these morons any more publicity or search engine help. Their franchisees are already paying for this kind of lunacy, I don't want to add to it.)

These are just a few of the offers. Even BSM and the other big guys are having to offer reductions and daft discounts.

Some companies will bear the cost of these discounts and as they may actually help to keep up your supply of customers you may not mind that the customers then disappear after the offer has finished - you still get paid don't you? Well, yep. But who's paying for the offers again? Oh yes, it's the franchise fee YOU pay every week to the company who are generously footing the bill for the discounts.

In the meantime the public are beginning to believe that the right price for driving lessons is around £10-£15/hour, when really this would leave the average instructor earning around half the minimum wage for every hour they work (they usually work around 1.5 hours for every hour they actually get paid and overheads are between £5-£10/hour).

Worst is when the franchise advertise these offers then "recommend" that their instructors offer the discounts themselves (or worse insist that they do) at which point the average instructor can actually find themselves paying for the priviledge of working.

So what do you think - is becoming a driving instructor a good way of spending your redundancy?


Anonymous said...

More sensible words - I've found that the school I have a franchise with offered a buy 2 hours get 2 hours free. I had 4 referrals from them and all of them had the 4 hours & despite my best sales technique (i.e. giving full value for money & being honest and upfront with them) they kept asking if I could match the £15 per hour that the others were offering.

We have the option of not offering the discounted prices and I'm seriously tempted to opt out as the customers who only go on the headline offers tend not the be the best quality

You can't run a business when your outgoings are more than your income, but I suspect the only way that the cheap brigade can afford to carry on running like this is to scrimp on their costs i.e. keep the pupils at the side of the road with the engine off, among others, which in my opinion doesn't deliver the product.

I know my value, and spent a substantial amount of money earning the green badge, so I'm not going to give it away. If the first question people ask me is ;how much do you charge?' I know I'm not going to get the business unless I can work really hard to persuade them of the value I'm going to give them

I've found in the 9 months I've been doing this job that some of my absolute beginners have been able to get a pass after about 35-40 hours of quality tuition (how modest!), some managing it without private practice, and they are starting to spread the word around.

All I need now is the confidence to cut the strings and go independent, hopefully cutting my outgoings, enabling me to either increase my profit margins, or more likely, offer a more competitive price - but still not bending over and giving it away for nothing

Anyway, keep up the good work & I'll be looking out for the next entry

The Undercover ADI said...

Thanks Alexander.

There has always been a problem with these offers. Normal "sales" in shops are there to get rid of old or unwanted stock, but in a service industry this is not the point.

They are used as an incentive to start to learn, but they nearly always draw in those who cannot afford to learn, or do not value our services.

It is a natural question to ask an instructor their prices, but I just tend to use it to ask them more about themselves and how best they can learn before giving them a price. If they learn best taking 3 lessons of an hour, I'll do them a deal per week. If they learn best with longer lessons, I'll do them a deal for a 2 hour session. If they only want the price for a 1 hour lesson, I know they're just checking prices and as I have no interest in competing on price alone I will tell them I'm the most expensive in the area! This often piques their interest and gets them wondering whether I am actually better than all the rest.

Even if they don't choose me, I've done my job - they may come back after trying the cheap guys.

Go independent Alexander. Spend your money promoting YOUR business. Keep all of YOUR referrals. Keep your pride and don't try to compete with the cheapest. That's what Woolworths did and where are they now?

Alex McLean said...

Thanks for those words Undercover.

The idea of selling myself short goes against all my instincts in running a business.

My time doesn't have a sell-by date, so to an extent, I could be forgiven for panicking & immediately offering anyone enquiring with me a really cheap price to entice them.

However, I know I give good quality service (no check test yet, but I'm not setting too much store by that, as it's a bit like a driving test - a snapshot of your abilities on the day, not taking into account your day to day working). Plenty of my pupils who have come to me because the brand name and said they prefer my style of teaching, as I give them an understanding of the tasks, and they learn much more quickly than with their previous instructors, some of who have a franchise with the same school.

I get the impression there are some less than scrupulous ADIs out there who string people along and try to convince them to have extra unnecessary lessons. I'm afraid that goes against all my principles, and I'm totally honest when I say to my pupils I want to get rid of them as early as possible - by them passing their test!

This means I feel justified in not discounting too heavily - I suspect that the people who are only driven by a cheap price are not going to be as motivated when they realise they will need 30-40 hours, which will still be a substantial investment.

Plus I've worked out my costs per hour are something like £9 - £11, so I'm not tempted to be a busy fool, working for next to nothing.

I think realistically I'll have to give it another 12 months to build up some capital as well as a reputation before taking the plunge - I cover a large city in the North East as well as a fairly large rural area, so it's taking some time to cover that ground and work out where the majority of my patch should be.

But if I can incentivise my current customers to talk me up (free tuition/voucher etc. for each recommendation) I think my name will make its way round the area eventually.

Unfortuntately the terms of my franchise don't allow me to put my name & mobile number on the car, so I'm relying on cards in windows with my number & website on to publicise myself, although if you Google 'the name of the national school plus my hometown' I come up tops. Hopefully that way people who see the car around town might find me directly that way.

Anyway fingers crossed & with any luck I'll be totally independent soon, one step at a time. It took me long enough to get out of a career I detested!!

The Undercover ADI said...

Sounds like you have the right idea.

Good luck with it.

Rob Barber said...

Alex - you're totally right about discounts and the quality of customers. The school I used to be franchised to have just dropped their standard fees dramatically. I was talking to one of there instructors earlier. He's complaining that it hasn't done much to attract new business and what new customers it has attracted have been timewasters.

Charging a reasonable fee at least attracts people who take their lessons sweriously and don't cancel at the last minute.