Monday, August 30, 2010
Disney English in Beijing/Shanghai
The Economist published an article on Disney English in Beijing and Shanghai (the first two cities where they have opened schools). You see the advertisement quite often in Shanghai, so it is interesting to read how they are doing:
They started not so long ago: "Thousands of Chinese children have signed up for Disney’s schools since the first one was opened in October 2008."
"Tuition is $1,800 a year". For an average Chinese, that is a lot of money. For a rich Shanghainese, it is not so much.
Slow expansion due to staff: "The main constraint is not customers—the older schools already have waiting lists—but training and staff. New schools must therefore be in places where they can easily be supervised". Yes, finding good staff is a big problem in China.
Very longterm and risky product: "The initial development costs, which Disney has not disclosed, must have been huge. Within a decade the programme will have a material impact on Disney’s results, predicts Andrew Sugerman, who runs it". That is quite risky as you never know with what regulation the Chinese government will come up next to protect its indigenous market.
But the potential is high, as always in China with its gigantic numbers: "Studies commissioned by Disney estimate that the market for children’s English-language education in China is growing by 12% annually and will reach $3.7 billion by 2012. That may be too modest. Adele Mao, an analyst at OLP Global, a research and consulting firm, reckons the market is already nearly $6 billion a year and is growing by 20%."
Photo by jplust