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Kids and Pets Still Popular

Written by: Mary Tomzack

Article Overview: Kids and Pets: Still Popular Kids represent huge opportunities for franchise companies. There are 4 million babies being born every year in the U.S. and most families are dual-income households. That combination has created $60 billion in annual revenues for the childcare industry. As the number of children increases, so does the competition to get into the best schools. Parents are feeling the pressure to help their kids get a competitive edge and a growing number are willing to pay for supplemental education services. In this issue we talk to Dr. Nick Whitehead of Oxford Learning and Amy Peterson-Smith of Kiddie Academy to get their views on the business of kids.

Kids and Pets Still Popular

April, Part 1 - Kids and Pets: Still Popular
Kids represent huge opportunities for franchise companies. There are 4 million babies being born every year in the U.S. and most families are dual-income households. That combination has created $60 billion in annual revenues for the childcare industry. As the number of children increases, so does the competition to get into the best schools. Parents are feeling the pressure to help their kids get a competitive edge and a growing number are willing to pay for supplemental education services. In this issue we talk to Dr. Nick Whitehead of Oxford Learning and Amy Peterson-Smith of Kiddie Academy to get their views on the business of kids.

Learning how to think the Oxford way
Oxford Learning provides supplemental education programs to children preschool through 12th grade. Programs include cognitive skills development at all grade levels plus summer enrichment programs, SAT and (soon) ACT test preparation, and French immersion. The three core programs are: Little Readers Academy (ages 3-6), Beyond Tutoring (grades 1-8), and Advantage High School Success (grades 9-12).

Oxford Learning began in 1984 when a team of education experts came together to create a unique learning program based on research into how children actually learn. It has since evolved into something much different. Dr. Nick Whitehead, Cofounder and President, says, "It grew out of a single learning center in London, Ontario. The original programs were designed to build cognitive skills for children who were either behind or learning disabled. We worked on the development of specific thinking/learning skills. By focusing in those areas, we were able to show that we could help even learning disabled children learn effectively. But what came of that is we got a number of kids in the program who were just behind and we discovered that the material and the concepts in the program were working wonderfully for just ordinary kids. Within about three years, the population of the center changed drastically until all we had were kids who were not achieving their full potential in school or kids who were there for enrichment. And we no longer were primarily for learning disabled kids. What's happened since then, of course, is we are in the mainstream of providing supplemental education for the average kid now."

Today, Oxford Learning goes beyond tutoring to help students reach their learning potential. And it's not just for their school career, but for a lifetime. "Our unique programs teach children to learn how to learn. Just one to two hours a week can make a world of difference in developing the right skills and habits to succeed, no matter what the subject or the grade level, and breaking the cycle of hiring tutors year-after-year," Dr. Whitehead explains.

Oxford Learning's methods seemed pretty radical 20 years ago. "It's not as radical now," says Dr. Whitehead, "but there's no one else doing it. We used the latest cognitive science to build fully integrated curriculum programs that don't just build academic skills. They first and foremost develop better thinking and learning skills, then we layer on top of that the academic skills. The kids learn the skills necessary to master the academic information that they are being taught so that they actually understand what they were learning, not just memorizing. That's been the secret of our success."

Oxford Learning maintains a large curriculum department that continues to develop materials based on the same strategy. For example, the company has recently introduced a new SAT program and an ACT program is near release. Dr. Whitehead says that most commercial SAT programs don't really help kids because all they do is cram for the exam to get a higher score. The result is a 40% dropout rate in the first year of college despite the high SAT scores. "We've got a 50-100 hour program that develops conceptual learning, organization, and time management skills while preparing for the SAT. The result is a student who is truly ready for university. It's harder to sell because everyone wants a quick fix, but it works," says Dr.Whitehead.

Franchisees don't have to be teachers
Franchisees act as center directors, not teachers. They do not need an education background. "Their function," says Mark Mele, VP of Operations, "is to operate their center. They recruit teachers to staff the centers, most of whom are certified."

Oxford Learning facilities are typically storefront locations of approximately 2,000 sf, located in strip centers or shopping plazas. "We target suburban markets with higher income that also have a certain population of school age children," says Mele. The cost of the programs varies depending on the area, but $60 an hour is typical. Kids attend 1-2 hours per week so on average, parents might pay $450-500 per month. The 100-150 hours of programming is spread out over 12-14 months.

The future, says Mele, looks outstanding. The company currently has 110 locations in Canada and 24 in the U.S. "We just started our franchise efforts here in full force back in July of '05 so we are just getting started here. We are seeing the supplemental education here in the states is thriving. That is one of the driving forces behind Oxford wanting to really venture into the U.S. Parents are seeking individual attention for their children that can't be received from the system. The fact is that an average education of B's and C's is no longer acceptable to achieve a post secondary education or attend a private school today," says Mele. "So parents want the biggest advantage they can get for their kids."

Contact Information: Dr. Nick Whitehead, Cofounder and President; Mark Mele, VP Operations, Oxford Learning Center, Operations, , http://www.OxfordLearning.com, 973-597-4300.

Quality childcare provides more than babysitting
Kiddie Academy is an educationally based childcare learning center serving children 6 weeks to 12 years of age. The first center opened in Baltimore, Maryland, in 1981. The company began franchising its concept in 1992. "Our typical clientele base is dual career family," says Petersen-Smith, VP of Operations. "Our services include a full-day program from 6:30-6:30. The cost to parents ranges, depending on the age, from $125 to $300 per week."

Kiddie Academy centers are built in communities inhabited primarily by dual income families where the demographics would support such a high end childcare facility. In some areas they are situated in an office complex; in other areas they are free standing buildings. They are not necessarily located on a major route, but rather somewhere along the way to a major destination, such as a large city or complex. Each 10,000 sf facility can serve from 100 up to 200 kids.

The most striking thing about the Kiddie Academy centers is the free-flowing floor plan design. The company boasts of state-of-the-art safety features and equipment, but the facilities are also designed for fun. Each age level has its own rooms, outfitted with colorful furniture, accessories, interactive learning aids, and toys specifically for kids that age. There are outdoor playgrounds, too. But probably the coolest area is something called "Kid's Towne USA." It's a miniature town comprised of child-sized buildings such as a post office, grocery store, library, and restaurant.

As fun as Kiddie Academy appears to be, education is the core service. Each center utilizes a state-of-the-art, age-appropriate, education-based curriculum designed to promote intellectual, social, physical and emotional growth. A typical day at Kiddie Academy depends on the age of the child. Generally, the day's schedule will include a balance of learning activities, rest and play.

Kiddie Academy franchisees are not baby sitters nor are they teachers. Petersen-Smith says, "A franchisee is the operator, the business owner. They are not actually watching children. They hire a center director who has to meet certain qualifications with the state. And then they hire individual teachers for the classrooms." In certain classrooms and in certain states and facilities, teachers are state certified teachers. Petersen-Smith explains, "When we use the term 'licensed' we mean that they've met the qualifications from the state licensing organization that provides us with our childcare license."

Although Kiddie Academy is education-based, the company competes within the $40 billion a year childcare industry. "There are a couple of things that set us apart from our competition," says Petersen-Smith. "First and foremost we do have a curriculum that has been designed, written and created by an internal group as opposed to something that has been purchased off of a shelf and utilized. That makes us very unique. One of the other things that we do that some other competitors do not do is we provide three meals throughout the day at no additional charge to the families. We see ourselves as kind of a community and families see us as an extension of their home."

Education based childcare is a growing field
Petersen-Smith says the interest in Kiddie Academy's service is on the rise. "We think it's going to continue to grow because of the clientele being more educated than in previous years. We are definitely seeing an increase in parents wanting to know what the curriculum is," says Petersen-Smith.

Currently there are 76 Kiddie Academy centers in operation. Another 30+ are in various stages of development. "We are getting ready to launch a target market program for expansion," says Petersen-Smith, "although we have not designated what those areas are going to be yet."

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