It’s pretty safe to say that the majority of faith-based schools across the country have welcomed students into the classroom or, perhaps, the virtual classroom, to begin the 2020-2021 school year. And isn’t it an interesting time. Remember all those families that asked the “What if we don’t have a computer” over the past decade? Perhaps these past 6 months provides a reason why the best time to prepare is when you don’t need to take action. With that in mind, NOW is the time to start planning for the 2021-2022 school year!
However, you’re still going to get parents that are interested in enrolling their children in your school for the current term. When I worked for an office that coordinated 20 elementary schools, this is the time of year I’d get phone calls from parents who wanted to enroll their child, but was told by office personnel at the school they would have to pay the full cost of tuition since there were no financial aid funds left. If that conversation still happens at your school today, that means that your school is full to the gills with children, and you have waiting lists for each grade.
Enrollment can only grow if children are enrolled. How can you increase enrollment if children are being turned away? Even if you have “no aid” left to give, a new child enrolling into the school is “found” revenue. This may require a change in thinking, shifting from a “financial aid” mindset to a “revenue stream” mindset.
Here are a couple of scenarios to illustrate:
Scenario 1: “There is no more aid” – While this may be true, stating this to just one parent will eventually cause your enrollment “funnel” to shut down since parents talk to parents. Instead, look at it this way. Johnny Smith’s parents has “0” ability to pay as reported by your financial aid assessment partner, yet his parents are willing to pay $1000. If you enroll the child, that’s $1000 that you didn’t have before he walked in the door. Next year, he becomes part of the financial aid process, and then can be awarded “real” aid dollars. Turn the student away in September and you’re defeating the whole purpose of building enrollment for your school.
WARNING: Once again, this is for NEW students – they might have moved here from another state, transferred by a company so that a parent can start a new job (and there may be a LOT of that going on right now), other families who may be moving in with the grandparents, etc. This action for current students will send the wrong message to current parents; that is, that they can apply for aid at any time, and the “deadline” for aid doesn’t matter because you can simply reduce the tuition they pay. Returning students applying after the enrollment deadline should be awarded aid on a first-come first-served basis with whatever aid is remaining. Those who choose not to apply for aid are obviously risking the consequence of paying the full amount because they are familiar with and aware of your tuition policies.
Caveat 1) Don’t count your full pay families until they’re hatched – ESPECIALLY in our current economic climate! Your full pays from last year may turn into aid applicants, and upfront payers may become monthly payers. To be fair, even thought they are “returning parents,” DO allow them to apply for aid just as you would a new parent, since, in reality, they are new to the aid process. However, if they were part of your school community in the previous school year, and you’re counting them as a full pay simply because they have registered and have not filled out a financial aid application, you are doing your school a disservice. Full-pay families who are not re-enrolled a week prior to the enrollment deadline should send up some red flags. They may be considering withdrawing their child; they may be too proud to apply for financial aid because they have been full-pay families for a number of years; or they may be experiencing some type of economic hardship that they’re trying to deal with. CALL THEM! Let them know they are important to your school! To not reach out to them sends the message that it’s all about the money – which is the worst message to send into the marketplace when you’re a faith-based school.
After reading this line, you may think to yourself, “Wow – what about all these schools that are closing because of the coronavirus pandemic, and the hardships that have pushed them over the ‘financial edge’ now?” If this is what you’re thinking, consider sending an email to email@example.com with the words “Pandemic Closure” in the subject line. I’ll share some thoughts on the matter.
Caveat 2) Payment method. “I’ll pay you when I can” is a big reason why schools are closing today. A contribution is a gift; tuition is an obligation. All parents should have at least 3 options when paying tuition – Full tuition due before the school year begins; half before school begins, and half due January 1; or monthly auto-withdrawal or online invoicing (yes, just like colleges do. There are some families who will say, “What? You mean I need to pay you a fee to pay tuition?” If that’s a response you’ve received, they’ve probably never had a child in college, and your action will prepare them for what they’ll experience when that time comes). All tuition payments should be handled by a third-party for payment security, parent convenience, and real-time reporting. I recommend FACTS for three reasons: One, I work for the company, but more importantly, I chose to work for them, because I’ve seen the company’s success when I worked with schools directly. Two, FACTS’ business model recommends direct debit because it’s the most successful way to get tuition to your school, but offers options of credit card and invoicing because parents today crave options! There are no late fees, and follow-up is included. If there are NSF fees, parents are held accountable for them, rather than charging your school a returned payment fee which happens if you accept checks at your school. It’s a platform that’s uniquely “school-controlled.” Three, doing so helps you stop chasing unpaid tuition and start chasing new students to enroll in your school. All payments going through a tuition management provider avoids: checks sitting in a drawer – or worse, on a desk – or even worse, cash in a drawer (or, in a coffee can, as I saw happen at a school less than 10 years ago!); multiple trips to the bank; parents asking for receipts; potential for fraud; etc. There are a number of other providers as well, but they may have fees which the company keeps, processing fees for payment transactions, or might use parent information in a way that benefits the company. It’s extremely important for you to do your due diligence when choosing a payment processing partner to mitigate the risk that comes from handling payment and protecting personally identifiable information today.
Scenario 2: “Miss Jennifer Jackson has withdrawn” – The parents of Miss Jennifer Jackson were returning parents, went through the financial aid process, and were only going to pay $1200, receiving $2600 in aid for a $3800 tuition bill. If the child leaves the school, the school is losing only $1200 in revenue. However, if the awarded aid is reallocated to existing parents, the school has actually lost THE ENTIRE $3800. What SHOULD happen is that this $2600 is reserved by the school to use for either new students coming in or reserved as additional income for the school. If you REALLY need to use it (as in, if you don’t use it, you lose it – which may happen in some state-funded scholarship situations), then perhaps use it as a source for those “end of the summer” appeals.
These methodologies are key to increasing and maintaining enrollment, as well as generating a positive cash flow from your tuition revenues.
© Michael V. Ziemski, SchoolAdvancement, 2010-2020 (Original Publication Date: 20050829)