I’ve been looking at a few threads on various forums – this topic crops up with monotonous regularity.
Here’s the scenario: “someone” (i.e. the resident shit stirrer on the forum), has “seen” a car (i.e. knows full well the school car and the person who owns it, or considers the franchise to be a local competitor), which has ” 5 lessons for £25 ” written on it (or some other offer). He starts a new thread and everyone else pitches in with their “opinions”.
The latest incarnation of this is funny. As usual, it is running to multiple pages, and if you look at the school’s website (I’m not providing it here – they will be getting enough traffic from the site which is bad-mouthing them) their normal hourly rate is £21. Since they are based in Yorkshire, this is actually a decent going rate for a lot of towns and cities up there.
So what we have is a driving school (franchise) which charges £21 an hour when a lot of the local independents will be charging £17-20 (or sometimes less). They offer an introductory 5 lessons for £25 as a marketing thing.
Of the people to wade in with their opinions on this shocking and unprofessional advertising is one guy who has introduced a ” 6 lessons for £99 ” offer for his own school due to falling enquiries. Another one (based not far from me, as it happens) works for a school which advertises ” 3 hours for £29 “, and which charges £1.50 below the national franchise rate for this area.
Let’s just do a quick comparison, based on the assumption that a new pupil is going to end up doing 40 hours with a school before passing their test.
The original school would take £760 from the pupil for this course of lessons – including the Special Offer. And their lessons are priced at the local going rate.
The school near me would take £843 (its hourly rate is £1 more than the school from Yorkshire). Even if you leave it at this, it is hardly an end of the world situation, is it? I mean: one school brings in £83 less than another per pupil over a 3-4 month period (a normal and typical learning period)?
But apply the fact that the “superior” school is charging £1.50 below the national franchise rate for its area, and that same school would be only taking in £750.50 if it was in direct competition with the northern school. Slightly less, but – for all practical purposes – the same.
Once again, we see that most ADIs are incapable of seeing the world through anything other than their own vari-tinted, internally-mirrored varifocals!
Note: Let’s not confuse special offers with just permanently charging stupid prices that damage the industry.