Analysis of private coaching industry in India

The private coaching industry in India is one of the fastest growing areas in the service sector. It caters to various sections of students like primary and secondary education, JEE and other engineering entrances, medical entrances, CAT and other management entrances, law etc. Not even the biggest economic recession was able to slow down this industry. The average growth rate for the coaching industry for the past six years is a whopping 35%. The current size of the private coaching industry in India is about $23.7 billion and is likely to touch $40 billion by 2015.
A majority of the middle-class parents have been spending one-third of their monthly income on private tuitions for their wards to do better in their examinations and prepare them for competitive entrance exams for professional courses. Even high-calibre students sign up for private tuition to score the 96-99% cut-off averages demanded by the best colleges.
The coaching industry in India can be divided into two broad categories namely, school students and students preparing for competitive exams. These two categories are discussed below separately.
(i)The school students sector:
The desire to score well has resulted in more and more schoolchildren going for private tuitions. According to a recent survey by ASSOCHAM, a whopping 87% of primary school students and 95% of high school students in metros receive private tutoring. In the last six years, the number of primary school children taking private tuitions increased by 100% while the number of high school students enrolling in tuitions increased by 92%.

The basic reason behind the increase is that parents rely on tuitions due to lack of time in case of working parents or they are ill-equipped to teach their children. Private tutors charge Rs.1,000 to Rs.4000 per hour per student on a one-to-one basis while group tuition costs Rs.1,000 to Rs.6,000 per month. The spurring growth of this sector has propelled many teachers of reputed schools and colleges to leave their jobs to take up private coaching.
(ii)Competitive exams sector:
The size of the entrance exam sector is even bigger than the school exam sector. As soon as the class 10th exams get over, students flock the coaching centres to start preparing for competitive examinations. Around 10 lakh students take up these exams every year. Since the school education system does not emphasize on concept application and problem-solving, all students irrespective of their performance in school take up coaching.
Even though coaching institutes are spread throughout India, the city Kota in Rajasthan is renowned as the coaching hub of India. There are over two dozen major coaching institutes and more than a hundred smaller ones for the 1.10 lakh students preparing for competitive exams which is 10% of the total number of students in India attending these exams. The annual coaching industry ‘turnover’ in Kota is estimated to be over Rs.1500 crore.
Year founded
No. of students
Bansal Classes
Resonance Eduventures
Career Point
Vibrant Academy
Allen career Institute
The above table shows the major coaching centres in Kota and the number of students in each institute. With coaching, other allied sectors- schools, real estate, transport, catering, and stationery are also thriving in the city. On a positive note, the coaching business has put Kota on the academic map of the country, boosting the city’s economy.
Future prospects for the coaching industry:
The Franchise model:  
The franchise model holds great potential for the private coaching industry especially the competitive exams sector. This is one area which is largely driven by brand-name. The model best suited for the coaching industry is franchise owned and franchise operated. Its because students give primary weightage to the study materials provided by the coaching institute. As stated in the above passage, leading coaching institutes are present only in Kota and other important places in North India. Only a handful of national institutes have branches in south India, that too only in a few places thus providing a good scope to tap the market potential. It is widely expected that the education sector’s contribution in the franchise business will increase from the present 5% to 6% in 2017.
Use of technology and communication:    
Eventhough the cost of private tuitions is very high, it has not yet made the full use of technology. The concept of smart classrooms, if effectively implemented, will be a win-win situation for both the institute and the students studying in it. There are a lot of renowned teachers whose lectures can be recorded and used. Biju’s classes which is preparing students for CAT and GRE is one such example which has only two teachers to handle English and maths subjects. The institute has more than 20,000 students who are currently studying in its many cities all over India. The use of digital OMR sheets can provide feedback automatically and also lessens the man power involved considerably. The effective use of technology can bring down the cost, the benefit of which can be directly passed on to the students. Thus exploitation of technology and communication facilities can revolutionise the coaching industry in India.
Thus the boom in tuition centres can be easily attributed to the perception that the country’s education system is flawed. This also clearly shows that the Indian education system is becoming increasingly competitive and examination oriented.
[The article has been written by Balaguru Sakthivel. He is presently pursuing his B.Tech from SASTRA University.] 


Leave a Reply

©2019 India's Finest Management Portal. IdeasMakeMarket and its logo are registered trademarks.

Log in with your credentials

Forgot your details?