Three vital budget analysis points for continuing education programs

Thu, Dec 15,2011 @ 03:38 PM
by Suzanne Kart |
lifelong learning best practices, data analysis

One of the toughest questions for many continuing education coordinators is related to when it is okay to cancel a program. There is a common feeling that canceling a program is negative and that a program is not successful if there are not at least 20 people participating. In LERN’s experience, with many lifelong learning programs the reality has been quite different.

Cancellation Rate

The cancellation rate benchmark is 15 percent. That means that 15 percent of the programs offered during a year are expected to cancel. You find out this percentage by taking the number of programs that cancel (15) and divide it by the number of programs offered (100). If your percentage is over 15 percent, then it probably means that too many new programs are being offered or that you are still running “dog” programs that have historically canceled. If your cancellation rate is below 15 percent, then you are probably not offering enough new programs.

The cancellation rate of repeat programs is much lower than the cancellation rate for new programs. Repeat programs if participation is good. Less than 10 percent of your repeat programs should cancel. The percentage is different for new programs.

Many times it takes time to get the word out about new programs and thus they may cancel the first couple of times they are offered.
Most programs find that 20-50 percent of their new programs cancel the first time offered.

Average Participants
There is no benchmark for average participants per program, but most organizations who provide programming strive for an average of 10-20 people. With an average of 10-20, that means there are programs with higher numbers and programs with lower numbers.

It is important to have programs that are diverse in participant size. Some programs such as arts classes are more successful with fewer numbers while sports leagues require much larger numbers. One size program is not better than the other. It is important to have the smaller sized programs because they provide diversity and entry options for participants. Not everyone is comfortable being in a program with 20 or more people.

Three Budget Analysis Points

Being aware of your costs is an important component of program size. When reviewing a program, there are three analysis points.

  • The first point is the budget point — the number of participants required to cover your projected income goal.
  • The second point is the break-even point — the number of participants required to cover your direct costs (promotion and production).
  • The third point is the go/no-go point. The minimum number is determined by taking your production costs and dividing it by the program fee. Your promotion costs have been spent and cannot be recovered, so as long as you cover the costs of running the program, you should do it.

LERN recommends following lifelong learning best practices no matter what the size of your program.

For more information on data analysis for lifelong learning and continuing education programs, download our free white paper!

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