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FDD Talk: The Huntington Learning Center Franchise Opportunity (Financial Performance Analysis, Estimated Costs, and Other Important Stuff You Need to Know)

by Franchise Chatter on February 14, 2017

in Education Franchise, FDD Talk 2017: Children's Franchises, Franchise Earnings

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In this FDD Talk 2016 post, you’ll learn the following:

  • Section I – Background information on the Huntington Learning Center franchise opportunity, including relevant news updates
  • Section II – Estimated initial investment for a Huntington Learning Center franchise, based on Item 7 of the company’s 2016 FDD
  • Section III – Presentation and analysis of Huntington Learning Center’s financial performance representations, based on Item 19 of the company’s 2016 FDD, including information on the:
  • 2015 average gross sales; distribution of sales by service (learning center service; test prep service; subject tutoring service; academic evaluation fees, registration fees, and miscellaneous receipts); hours of instruction; conversion rate (academic evaluation conversion, enrollment conversion); hourly tuition (learning center tuition, test prep tuition); length of stay (learning center LOS, test prep LOS); rent; and call center and coaching services fees for the 181 franchised Huntington Learning Center businesses open all of 2015 under the same franchisee (“Open Franchise Centers”)
  • 2015 salaries and tenure (teacher, assistant director, teacher supervisor, program administrator) at company-owned Huntington Learning Center Businesses
  • certain expense items listed on the end-of-year profit and loss statement franchisees submit to the franchisor

Section I – Background Information

On a Mission to Educate Children

The first Huntington Learning Center was opened in 1977 in New Jersey by Dr. Raymond Huntington and his wife Eileen. The couple, who were involved in education, saw the need to supplement what children were being taught at school. Demand for Huntington’s teaching services grew and a second learning center was opened in 1978.

Over the next few years, more Huntington Learning Center locations were opened throughout New Jersey and the company officially began franchising in 1985. The company continued to grow through the rest of the 80s and by the end of the decade, there were 100 Huntington Learning Center locations.

Expansion continued through the next decade and by the end of the 90s, Huntington had 200 locations throughout the U.S. At this time, the company announced its ambitious goal to have 650 locations by 2007.

In 2000, Huntington tried to open 20 company-owned locations, which resulted in the company being unable to pay some creditors on time. Its creditors filed a court petition seeking an involuntary Chapter 7 bankruptcy so the company could pay back what it owed. However, Huntington fought the petition and raised enough money to pay the creditors back. The petition was dropped and Huntington slowed its aggressive growth strategy.

Today, Huntington Learning Center has more than 250 locations throughout the United States.

Huntington’s Award-Winning CEO

CEO and co-founder Eileen Huntington has been recognized for her work by several award-giving bodies. In 2016, Huntington was selected as one of the top 40 business leaders in New Jersey by SmartCEO’s Brava Awards Program. The Brava Awards celebrates high-impact female business leaders in three categories: CEOs, Executive Directors of Nonprofits, and C-suite Executives.

SmartCEO describes Brava Award winners as those who “combine their entrepreneurial spirit with a passion for giving back to the community, and are exemplary leaders of their companies and their communities.”

In the past, Huntington has been honored as a Top Woman in Franchising by Franchise Update magazine. She was also recognized as a Franchising Woman to Watch by Entrepreneur Magazine. Huntington was one of three CEO’s featured in the category for Entrepreneur’s January 2015 issue.

Successful Track Record of Helping Students Succeed

The year 2017 marks Huntington Learning Center’s 40th anniversary. Over these past four decades, the company has helped students succeed in many ways. As a result of Huntington’s four-step tutoring program, students see an improvement of two grade levels in reading and math.

The learning centers also prep students for standardized tests. Through Huntington’s tutoring, students, on average, see a 4-point increase on their ACT scores and a 200-point increase on their SAT scores.

To help Huntington stand out from the competition, all of its learning centers have the proper educational accreditation. Huntington Learning Centers, Inc. has been accredited by the Middle States Association of Colleges and Schools since 1996, and has been re-accredited every five years since then.

In addition to all of its centers being accredited, all of Huntington’s tutors are certified.

Middle of the Pack on Entrepreneur’s Franchise 500

Overall, Huntington Learning Center ranks well on Entrepreneur Magazine’s annual Franchise 500 list. For 2017, the company has landed spot No. 63. This rank is Huntington’s highest on the list. This year’s rank is up from 2016’s rank of No. 198. Huntington’s lowest rank was No. 500 in 2012.

Section II – Estimated Costs

  • Please click here for detailed estimates of Huntington Learning Center franchise costs, based on Item 7 of the company’s 2016 FDD (updated).

Section III – Financial Performance Representations (Item 19, 2016 FDD) and Analysis

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