How to Start an Online Tutoring Business

Introduction to start an online tutoring business

During the COVID-19 crisis, many families are facing the challenge of altering work, childcare, and distance learning. And at the same time, many part-time and hourly educators are struggling with a sudden loss of income. Online tutoring business is a great way for educators to support parents and students while earning an income from home.

Online tutoring is a profitable full-time or part-time profession for anyone who loves to tutor others. The advantage of being an online teacher is that you can work from absolutely anywhere you want, as long as there is a good internet connection. You don’t need to commute, you can work from home. Here is all the information you need to know about how to start your online tutoring business.

A guide on how to start an online tutoring business

Online tutoring is getting more and more popular and it is the perfect solution when you want to share knowledge and be your own boss at the same time. If you are looking to start an online tutoring business and don’t have much idea about that, you have come to the right place. This article will guide you through a step-by-step process for planning your tutoring business from your home.

Requirements to start an online tutoring business

Following are the requirements to become an online tutor:

  • In-depth knowledge of the subject
  • Familiarity with the course structure
  • An enthusiasm to teach
  • Ability to deploy various resources effectively
  • Good communication skills
  • Being able to ask the right questions
  • Listening to the students
  • Flexibility in approach to match the needs of the student
  • Ability to encourage students
  • Ability to provide constructive feedback

Although these are not fixed, having these will certainly help you in getting attention and trust from students and parents. It is said that exceptions are always there, with respect to requirements. 

Steps on how to start your own tutoring business online

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Steps to starting your own tutoring business online.
Steps to starting your own tutoring business online.

These are the steps to get started with online tutoring:

Step 1: Make a business plan

Strong businesses start with a strong plan. A business plan is a written description of your planned business and business strategy. It’s your vision of how your business will be organized, how it will operate, and how it will be profitable. You can find a lot of information online regarding writing a business plan.

A typical business plan includes:

  • Executive summary
  • Company description
  • Market overview
  • Sales and marketing strategy
  • Operating plan
  • Organizations and management team
  • Financials
Step 2: Perfect your computer setup

Find a place to conduct your online tutoring from home. The location should be away from the noise of the house and has plenty of light. Then, position yourself so that there is a clean, neutral background behind you in video calls.

You should also make sure that you have all of the technology you need to begin online tutoring. You, of course, need a computer and a strong internet connection. You should also have a webcam and a functional microphone. These tools make it easier for you to illustrate and share concepts with your students from a distance.

Step 3: Find the right tutoring software

Once you have your hardware figured out, you should select your software. You should consider purchasing the following types of software for online tutoring:

Video calling software: Find a video calling software like Zoom or Google Hangouts that allows you to schedule meetings in advance and then send meeting links to your attendees via email. You should also look for the ability to share your screen as you will likely want to use this tool to make demonstrations in your tutoring.

Virtual whiteboard software: Virtual whiteboard software allows you to draw, write, and a diagram on a digital whiteboard. All you need to use the software is a mouse, but using a tablet or a digital drawing pad and stylus gives you even better control.

Document sharing software: Google Docs is an excellent tool for sharing documents, editing simultaneously, and making comments on specific pieces of a document. Google Classroom further expands these tools. Using Google Classroom, you can create a central hub of information for your students.

Step 4: Set your rates

As your own boss, you get to decide on the rate you charge for your services. Rates vary dramatically from tutor to tutor, and they typically depend upon your education level, the subject area that you teach, and your students’ specific learning needs.

Tutors who charge the highest rates are those who teach in-demand subjects that require significant experience and familiarity, like high school and college-level math and science. Tutors who have training and experience working with students with special education needs also typically charge higher rates.

As you think through your pricing rates, you should look into the rates that the other tutors in your content area charge. Then, you should take into account your anticipated business expenses (pricing for any required software, self-employment taxes, and the time you spend preparing for each tutoring session). You can set your pricing range for online tutoring by using this information.

Step 5: Register your business

In many cases, registering your tutoring business is technically optional. Here are the most popular ways to incorporate.

Sole proprietorship: Tutors who decide to operate as a sole proprietorship or partnership do not need to do anything to register their business. Essentially, the business is an extension of its owner. Sole proprietorships are easy to set up, and typically in a sole proprietorship, taxes are simpler than they are with other forms of incorporation.

Even if you decide to operate your tutoring business as a sole proprietorship, we suggest setting up a plan for separating your business finances from your personal finances. The easiest way to keep your finances separate is to create separate business checking and savings accounts. These additional accounts make it easier to track your profits and losses, and they can save you a ton of headaches when it’s time to pay your taxes. 

Limited Liability Corporations (LLCs): Aside from setting up a sole proprietorship, many tutors find that establishing an LLC is their next best option. LLCs offer limited liability protection for their owners. Each state has its own rules for what it takes to start an LLC, and you don’t necessarily have to register your LLC in the state where you’re doing business (although you generally should). Like with a sole proprietorship, LLC owners report their business earnings and losses on their personal taxes.

C-Corp: In a C-corp, shareholders are considered the owners of the company, and they receive limited liability protection. However, at the same time, business decisions are made by corporate officers who may or may not be shareholders. In a C-corp, taxed are filed separately from personal taxes, and shareholders pay income tax on dividends. In order to form a C-corp, you have to file articles of incorporation with your state.

You should also consider filing a DBA (Doing Business As), Entity Name, or Trademark for your tutoring business. Filing a business name allows you to operate your business under its own name, instead of your legal name

Step 6: Establish a web presence

As an online tutor, it’s crucial that you have a strong online presence. There are a few ways you can go about building your web presence:

Create a website: It never hurts to have a sleek, attractive website. Developing your own website will add credibility to your tutoring business and can help build hype for your services. Luckily there are user-friendly and cost-effective website builder tools that can use to set up a site in a few days.

Set up social media: Set up business accounts on the social media sites that your clients use most frequently (Facebook and Instagram are good places to start). Make sure you include important information like your subject areas and a link to your website.

Create a yelp page: If your business doesn’t already have a Yelp page, now is a good time to set one up. Adding a page on Yelp encourages more clients to leave reviews, and it can help direct new potential clients to your services.

Step 7: Choose a payment processing solution

In order to accept payments online, you’ll have to integrate with a payment processing solution. Payment solutions fall into two categories: Payments Service Providers (PSPs) and merchant accounts.

PSPs are typically easier and faster to set up, but they are also known for having account stability issues. Many PSPs accept merchants almost immediately, and then upon review decide that certain merchants are too high-risk to use their platform and freeze their accounts.

Merchant accounts will take a long time to set up because there is an initial review process. This makes merchant accounts more stable. Merchant accounts also allow you to negotiate the rates that you pay for payment processing.

Step 8: Market your business

Once you have your website and payment method set up, it’s time to start marketing your tutoring business! Here are a few methods you can try:

Email marketing: If you already have your own large network, make sure to notify them of your new business. Use email marketing software like Mailchimp to reach out to family and friends with information about your tutoring services.

Social media marketing: Use your personal and business social media accounts to announce your business. One great way of gaining new clients with social media is to put out free content that anyone can view or download. Upload or link your favorite learning resources, and create a few videos to show how you prepare for a tutoring session. Sharing these resources and videos demonstrates your personality and teaching style. It can help build your reputation and make you appear more approachable.

Share customer testimonials: Ask for a positive customer review from happy clients, and then use that reviews to your advantage. Word-of-mouth goes a long way. Make use of it in any way you can.

Post-in-person flyers: Place fliers with tear-off tags on bulletin boards in libraries, churches, schools, gyms, and daycare centers. Think about where parents of school-age children might be, and get your fliers out there!

Offer free consultations: Consider giving new potential clients an opportunity to meet with you for a free initial consultation. It’s a good idea to include parents in this initial conversation.

How to tutor online

Today’s online tutoring classrooms have all the tools required, which facilitates the ‘one-to-one’, or the ‘one-to-many’ tutoring session. In these sessions, you can do the following:

  • Start a face-to-face video conferencing
  • Speak to each other with high-quality and excellent voice
  • Write, type, erase and draw on digital advanced whiteboard in distinctive colors
  • Text chat via instant messaging
  • Upload and share files
  • Access the session from all devices 

How to attract more students

Once your online tutor profile is endorsed, and you have experienced a couple of online sessions, you have to do the following things keeping in mind to attract more students to book more sessions with you:

Update your profile: Then, consider what your potential clients i.e, students want to hear from you. Include a video message in your profile. This adds far more value than a simple and basic content profile.

Ask your students to give you ratings and reviews: Ratings and reviews should be apparent on your tutoring profile. The most ideal way would be to ask your students to rate you just after the session.

Availability is a big issue for most students: If your available timings don’t coordinate with the students, they won’t book sessions with you. Continuously remember the time zone of your potential students.

Always respond to the session requests quickly: In case you receive a message from any enquiring student, be helpful to them.

Common mistakes

However, it is important to avoid certain mistakes when starting out.

  • Spending too much money at the start
  • Unclear terms and conditions
  • Failing to price your tutoring services correctly
  • Failing to define a niche
  • Failing to invest time and effort in online marketing

Conclusion

There is undoubtedly a lot to learn in the online tutoring business. As you start your career as an online tutor, you are unlikely to have all the knowledge and skills necessary to act as a subject expert, coach, assessor, and a proficient user of online tools. We hope that this article has given you more than a few insights to get started. Wishing you every success in your online tutoring business!.

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