How can the school make money for itself? Discuss and research options for income-generating activities

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At the moment, the school gets its income from the registration fees paid by students, the child sponsorship programme, and other small donations from abroad.

Over the longer term they would like to become less dependent on outside support by finding ways to make money for themselves.

They have typewriters which are used to teach the students to type. They also have a piece of land where they eventually hope to build a school.

For this task, we would like to talk about different options that the school could explore to help them generate additional income. How can they use the items listed above? What other ideas do you have?

In the future, they hope to start sewing classes, and will also use the sewing machines to make clothes that they can sell. If you have ideas on how they can get hold of machines, please post them under the Find SEWING MACHINES for the school task.

What is the level of income that the school is hoping for?

The basic maths for earning in any school is -

Earnings (from school fees paid by students)
minus Expenses of running the school
= profit

If expenses are more than earnings, an immediate solution is
- reduce the expenses
- increase the earnings through increase of fees from the students

This will certainly generate a profit.

For profits beyond this, the following questions arise
- what is the level of profits being targeted?
- what are the core competencies of the school in other areas where earnings can be generated?
- can these earnings be supported through the local population?

Solutions could be attempted depending on the answers to these questions.

Vijai

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Hi Vijai

As I understand it, the school are considering increasing charges to students next year, but the issue is that the majority of families are not able to pay much. So they are looking for other ways to make money.

Paul, please can you provide some more information on the points raised by Vijai. Do you have information on what the running costs are and how much money is coming in at the moment?

Is there a way to use the typewriters to make money? For example, typing up documents for other people, possibly allowing people from outside into the school to use them for a small fee at weekends (assuming likely income would be more than paying a member of staff to be on-site at the time)?

Have the school staff discussed other ideas for making money? Maybe they, the students, adn parents will have some good ideas.

Mary

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Hi Paul

Were you able to get any good information from Teach A Man To Fish?

Some things that other schools are doing or talking about doing to make money...

* Growing vegetables. If you have land there are people on Nabuur who can advise about methods that should not require any outside money to start. Until you start the sonstruction work, maybe this could be done on part of the land where you hope to build your own classrooms.

* Keeping poultry and/or animals (goats, pigs, rabbits etc)

* Making Crafts/jewellery

* Making reusable or disposable sanitary pads

And a post by Barb Briggs at http://www.nabuur.com/en/village/bukoggolwa/project/task/brainstorm-opti... about how a school could make money from its library

Quote:
Hi,

One way to make the school self-sustainable is through a library - not sure if the school has one, but if there is a small space that can be used as a library there are ways to generate income. In one successful project I have seen, people are charged a small monthly subscriptions fee (determined by the community to be acceptable and affordable but still enough to generate some income) for use of the library. The library would need to have copies of text books and other materials of interest to people in the community. The subscription fee would be far less than parents having to purchase books for their children and would provide them access to the books for studying purposes. In addition, the librarian or a teacher could offer evening or weekend/out of school tutoring. This would help the children learn more and generate some income. The fee charged again would have to be acceptable in the community but still enough to pay the tutor/librarian and generate some income. Also, out of school time, the classes can be used for adult literacy. In a project in Kenya, many mothers were willing to pay a fee to learn to read and write English. The school allowed the women to pay as a group so that they could take turns. For example if there was 3 women but then couldn't all attend at once, they would pay for 1 women and they could alternate evenings that they came. The woman that attended the class would then teach the other two women what was covered during the class they missed. This makes it more affordable for the women, but also generates income.

Also, in off school times the space can be rented out for community activities.

In addition, if you think of a library space as a business, there are many opportunities for generating income. In the project mentioned above, the librarian/teacher had an incentive to come up with viable income generating ideas, as 50% of the income generated went to her as her wages - if there was no income coming in to the school/library, then there would be no income for her as well. Some of the ideas that they came up with included the rental of soccer balls, the rental of newspapers each day, the rental of cameras, and the selling of small goods made by the students or other community members.

Barb

Obviously, everything will depend on local skills and markets which is why I am interested to know what discussions the school have had about ways to make money.

Please let us know your thoughts.

Mary

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Hello Vijai,

You presented some important ideas. However, at this point, it is not about profit and loss, actually. As Mary indicated we are receiving funding to run the school at the moment.

We are thinking about ideas that could help the school become self-sustainable. We don't intend to depend on outside funding throughout the existence of the school. So, we need ideas on self-sustainability.

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Paul

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If the village is able to get goats, chicken etc.. donated it would be a great help in having a sustainable income. If the village is interested in going this route we could look into finding ways of achieving this

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nandini
fortheloveofsai

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Hi everyone

Nandini, yes I was wondering about animals too, either to be kept by the school, or by parents/guardians so they can become indpenedent and be able to afford to pay a modest fee to send their kids to the school.

Paul, did you have any thoughts on the income generation ideas that I mentioned? It would be great if we could find some ways that don't need a lot of outside money to get started, although everything may need some.

Although you are not aiming to make a big profit, simply to cover some or all of the running costs, I do agree with Vijai that it would be helpful to know roughly how much money you are hoping to make - that may give an idea of whether you could achieve this from one single business idea, or whether you may need to do more than one thing.

Mary

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Hello Paul,

To further elaborate on my previous post here, in response to your comments above, consider the following:

To reach a point of self-sustenance, what would be the income levels that you have in mind?

For example, if self-sustenance is a stage of no-profit, no-loss, this mathematically means that whatever is earned is spent. It is the amount of earning, or income level that you must first identify.

Why is the income level to be identified first? - because different methods of earning will generate different levels of income. You will need to focus on only those methods where the anticipated earnings are broadly in the range of earnings that you have in mind.

For eample, assume routes A,B,C,D,... each generate respectively 100, 1000, 10000, 100000, ..., and your expected earnings are 10000, then you will need to focus only on route C. Routes A and B will not generate enough to meet your needs, and for route D you may have to invest more to generate the respective income.

Without going into these specifics at the start, in case you do get caught in generating income through schemes A and B (instead of scheme C), you might have to backtrack later and several years of hard work could go waste.

Vijai

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Hi Vijai,

Thanks for the elaboration. You mentioned various routes/methods/schemes – A, B, C, D, etc. – of generating incomes. As I indicated originally, and based on the task, "How can the school make money for itself? Discuss and research options on income-generating activities," I thought we would first focus on identifying the "routes/methods/schemes" or possible types of income-generating activities, instead of focusing on "which areas will generate the most incomes." You see my point?

Even if I were to post a figure, I am almost sure we would come back to the point I made – that the point is about identifying activities that will help the school to generate income. For example, Nandini mentioned goats and chickens.

Private schools mainly depend on tuition and fees. Public schools generally depend on the government. Charity-oriented schools, like ours, generally depend on donations. And not many have even thought about methods of ensuring self-sustainability. In fact, I myself started giving the idea serious consideration after joining Nabuur. I had not seriously thought about it. Now, I know that it's worth doing, although we don't know what to do exactly. That's why we need ideas.

Anyway, to respond to your question directly, let's assume we need $500 per month to keep the school running. This is only for now, as we may need more money in the future, say, two or three years from now. If all the sponsors were to stop donating to the school right now, we would not be able to operate the school.

So, on your point that the income level be identified first, it's $500 per month, which makes $6,000 per year.

Look forward to hearing from you.

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Paul

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Hi Mary,

I've already posted (under Vijai's post) the estimated amount we need per month to keep the school running.

Yes, I gave the them (the income-generation ideas) some thoughts. As you rightly indicated, the all require money to start.

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Paul

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Hi Nandini,

Thanks for the income-generating ideas. I am sure it wouldn't be an easy thing to get a goat as a donation in Liberia. They are not common. Besides, they are expensive. I am not too sure, but I think the cheapest one costs about $250. For chickens, they are found everywhere. In addition, they are cheap. Five dollars can get you one.

Look forward to hearing from you.

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Paul

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Hi Paul,

I must congratulate you for your clarity of thinking. You were able to immediately focus on the specific issue - what is the target for earning?

By determining an earnings figure of USD 6000 per annum to start with, you have crossed the most difficult stage of your journey. This is a milestone for you, and you must start believing that, just by determining how much you need to earn, you have already achieved a good deal of your target. You have set the ball rolling, and the rest should be easy.

This is how you need to proceed further:

- 'Eliminate' those projects which are not going to generate a profit of USD 6000 per annum. The profit from these projects is to be used by you to run your school. Pigs, goats, bracelets, etc are not going to generate revenue at your targeted levels. If at all you plan to generate a profit of USD 6000 per annum from such projects, you may have to first invest anywhere from USD 30,000 to 50,000 in any such scheme, or a combination of these. If you do not invest this amount at the startup stage, and grow it gradually, such schemes will generate revenues which are too-little-too-late, and it could be decades by the time you see a profit level of USD 6000 per annum from such schemes.

- Having eliminated all such schemes, you may be left with no scheme at all. If at all some scheme does remain from your perspective, let us hear about it, so we can take it further on this thread. If no such scheme remains, you could work on my suggestions in my previous post above, and think of new possibilities from your own perspective and which could work in your region, and we can then work on these.

The approach in my posts has not been on advising you on 'what is to be done', but on advising you first on 'what is "not" to be done' to meet your objectives and achieve your targets. In the next stage, after we see your opinions here, we could then move to the next stage.

You input on the possibilities is important at this stage, since you are the best judge about which work and how much of it you can handle at your end. The following questions in my first post in this thread might help:

- what are the core competencies of the school in other areas where earnings can be generated?
- can these earnings be supported through the local population?

Vijai

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I do agree with Vijai's suggestions.
Good idea to weed out what is not possible due to startup costs or any other reason. We can then look at the possible schemes and then go from there

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nandini
fortheloveofsai

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Hi everyone

I agree that the school needs to look at startup costs and likely income when deciding which small business options are suitable. If they don't already, they will need to learn the basics of how to plan and run a business.

I do not completely agree that the school should only focus on ideas that can generate $500 per month from a single business, although it would be great to find something that could do this.

I say that for several reasons.

It may not be possible to find one business idea that will make the full amount of money right from the beginning.

You may need to start something which can grow over time, or run more than one business. If the total amount required is $500, making e.g. $100 per month would be a good start.

Starting with a business idea that the school staff are familiar with, and have the skills to run, will be easier for them than doing something that may make more money, but requires skills that they do not currently have.

If they are not used to the idea that the school can make money for itself and does not have to rely totally on outside support, even a small successful business will increase their confidence, and they may then choose to go on to something more ambitious.

Having a small business of any sort is a good way to teach business skills to the students, especially the older ones who may choose to (or have to) start working when they leave the school.

I agree with others who have said that the people at the school are the best ones to judge what will work and what will not. Paul, is this something you can discuss with the staff at the school, and see what they think? It may be that once you suggest it, they have many good ideas of their own.

We can suggest things based on what has worked elsewhere, but you and they are the only ones who will know what is practical in Buchanan.

I know that you hope that the school can make money by making and selling clothes once you have the sewing machines. Has anyone at the school done any reasearch to work out the likely ongoing costs of doing this (material etc) and the amount of money that you will make?

Mary

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Hi everyone,

For the school to make money through tailoring activities it must first be established that the students have the ability to pay for uniforms. So if the ability to pay for uniforms is based on outside sponsorship, one must make sure that outside support will be sustained

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Stanley Okurut

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Hi Stanley,

I think the option to be explored is not tailoring uniforms for the students of this particular school, since for this option, as you have rightly mentioned, the school will need a steady flow of funds from the sponsors of the uniforms.

On the contrary, the school needs to generate income through tailoring as one of the options. This is possible only if they have trained tailors, who can meet the requirements of customers (outside the school) in terms of quality, time, and prices. This tailoring unit needs to work like a garment fabrication factory or a shop, for the sole purpose of generating revenue and profits.

These profits are to be then used to run the school as a self-sustaining unit. Paul has mentioned in this thread a figure of USD 6000 per annum which he feels is required to run the school on a self-sustaining basis. The school is now looking for options on how to generate this amount through their own efforts (without resorting to donations), and generating profits by operating a garment fabrication unit is one of the options they are exploring, as I can understand from the posts here.

Since no single option may generate USD 6000 per annum as 'profits', the school would also like to explore other options, so that they ultimately have a 'basket' of profit making units, and the cumulative profit of USD 6000 per annum (if generated) of all units in this basket would be used to run the school. At this stage the operations would become self-sustaining, since outside help will no more be required to run the school.

Vijai

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