When you are setting out as a First Aid Trainer, one question that you should ask is what format should I trade under. Whilst it is possible to swap between different types, they are often different legal entities and therefore Bank Accounts and insurance policies will need to change. Anyone that has changed Bank Accounts will know how much of a hassle this is.
If you have Registered with a Business and complete a ‘New Supplier’ form then you will have to do that all over again. Better to consider all the possibilities before you start.
None of this is to be construed as Financial advice, obviously. If you want help drawing up Legal Forms, Law Depot do a good line in Business documents and Contracts.
Individual (Sole Trader)
You trade as yourself. You can give yourself a Trading name e.g. Andy Crowhurst t/a (trading as) ‘ACrow Training Services’ but you and the Business are the same. You file your income and Profit on your Annual Self-Assessment form, pay any Tax and National Insurance that is due and keep the balance. This is the simplest way of trading.
Advantages
It is cheap to set up
It is simple to stop trading – you can literally just stop once you have settled all bills etc.
Disadvantages
You are liable. As you and the Business are the same, any claims made against the Business are also against you. The worst-case scenario is that you could lose everything.
Not so many tax breaks as a Limited Company
You need to be diligent in separating personal and Business income and expenditure.
It can be seen as riskier by a prospective Supplier or Client
It won’t work if there is more than one of you.
Partnership (with one or more others)
You trade with one or more other people, splitting the Business as you agree. It is vital to take advice and make sure Contracts are drawn up that cover the Partnership and what happens should someone wish to (or be forced to) leave.
Advantages
Cheaper than a Limited Company to set up and less onerous
More tax efficient than a Sole Trader
Business information is more private than a Limited Company
Disadvantages
You are jointly and severally liable. This means that you are all on the hook for everyone’s debts and if one Partner does a bunk, the Creditors can come after you and your home.
Raising finance is a team effort as the Partnership does not exist on its own.
Even if you leave, you could still be liable further down the line
Limited Liability Partnership (LLP)
A LLP is a legal entity in its own right and the liabilities of the partners are (unsurprisingly) limited. It is a halfway hours between a Partnership and a Limited Company
Advantages
Partners’ liabilities are limited
More flexible than a limited Company
Disadvantages
More onerous reporting than a Partnership (e.g. Accounts must be filed at Companies House)
Limited Company
A Limited Company is a Legal entity owned by one or more shareholders. It has more onerous reporting requirements than any of the above, but also has advantages
Advantages
Separate legal entity. Shareholders’ liabilities are literally limited to the amount that they paid for the shares (which could be £1) and, unless they are negligent, Directors have limited liability if the Business runs into problems
Generous tax breaks and allowances compared to other entities
More respected when it comes to signing up new suppliers and clients
Easier to raise money
Disadvantages
More onerous reporting requirements
More complicated to close
Other entities
There are other formats such as Community Interest Companies, Charities, different versions of Limited Companies and so on…
You need to decide what is best for you and do seek Professional advice if you are not sure. Mistakes at this stage can be costly down the line.
The Pareto principle states that for many outcomes, roughly 80% of consequences come from 20% of causes
Mr Pareto and Mr Juran
Many businesses overextend themselves by either taking on too much or by spreading their skills too thinly. They end up being run ragged and nobody ends up happy. Here are my top 5 guidelines to running a successful Business
Stick to what you know
It is OK to say ‘no’
It is OK to withdraw gracefully from a sector
It is OK to let a Client go
You can charge more than you think you can
Stick to what you know
Sure, every Business needs to expand over time and there are plenty of examples of successful Businesses going into radically different sectors – the Virgin Group is a good example.
If anyone has read any of Richard Branson’s books, however, you can see that it has not always been successful – he has been close to bankruptcy at times – and not always plain sailing. For every Richard Branson, there are plenty of others that have tried – and failed. Survivor bias means that you only get to hear of the successes. Those that didn’t make it tend not to write about it.
I recommend that you start with a core offering and, once that is established, look at what you can add on. Take First Aid Training for example. From a core workplace (BLS, EFAW, FAW) you can move to Paediatric, then Outdoor as a route. From there you could look at Pet First Aid.
All these are easily achievable with your core skills plus a bolt-on course and a few more training items.
If you then choose to deliver Mental Health First Aid or First Aid for Children or even take the logical step across to providing Event First Aid cover then you are suddenly looking at a big step up in training and a new range of equipment. Setting all that up and getting qualified & equipped will take your mind off the core ball.
Alan Sugar bought Tottenham Hotspur as he had an interest in football. Whilst he did eventually sell it at a profit, it took a lot of his time in turning it around and merely running it, enough that Amstrad missed out on the tech boom that was happening at the time.
“The way I see it” – Alan Sugar
It is OK to say ‘no’
When you are starting up, it is easy to say ‘yes’ to each and every First Aid training request that comes along, never quite sure when the next one will be along. Better to deliver a marginally profitable, or even a loss-making course than have nothing on that day.
Whoa. Take a step back. Have a think. “Will this course actually progress the Business”? If it won’t, then should you really be doing it?
Here’s an example. You get asked to run a First Aid taster to a local Club or Organisation. “Just a couple of hours one evening. We can’t pay much but you can help yourself to the Pot Luck supper and we’ll get you a drink or two”. Great, free food and a cushy evening making new contacts as well as giving something back to the community. Apart from that last item, which is not unreasonable and very worthwhile, the rest will not help you develop your Business. It is pretty unlikely that any meaningful work will come of it, you will spend half a day on it (preparation, travel x2, post-course cleaning and repacking) and either it will come hot on the heels of another course that day (so you will be tired) or you have sacrificed a day’s income to fit it in.
Learning to say ‘no’ gracefully is a big Business skill to learn, but developing and expanding your Business is as much about saying ‘no’ as it is saying ‘yes’.
It is OK to withdraw gracefully from a sector
Cutting and running is always an option. Not everything works out, but at least you tried. Hopefully when you go into something you have prepared, run a SWOT analysis, trialled it etc, but many factors outside of your control can affect what happens. I tried Pet First Aid, got the qualifications, bought all the kit, advertised it and had a go. Despite us being a Nation of pet lovers there just weren’t the numbers to support it. Perhaps I hadn’t researched enough, or pushed it enough but I did work out that it was distracting from my core Business. When my pet First Aid teaching qualification came up for renewal, that was the trigger to get out, sell the kit and move on (or in my case, back to my core).
Sometimes external events come from left field
Tanks of fish nibbling at feet was all the rage not so long ago – eating dead skin cells and generally providing a form of beauty therapy. I saw a fish pedicure Business set up in my local Shopping Centre. Within two weeks of it opening, a report came out stating that people having the treatment were in line for a bacterial infection from the fish via the smallest of cuts. This killed the whole Business overnight. Rough, but that can happen. The Business had no option but to close. To do otherwise would have been ruinous.
It’s OK to let a client go
This comes down to the Pareto Principle mentioned at the beginning. We’ve all had that ‘client from hell’. The one with the impossible deadlines at short notice. They are picky, late payers and always wanting this or that. You will find:
80% of your Business comes from 20% of your Clients
80% of your problems come from 20% of your Clients
If you are spending a lot of time dealing with awkward clients, stop. Drop them, move on. Replace them with a client that could be in that first list instead. Over time you will improve your Client base, reduce your admin time and increase your cashflow. Your Mental Health will improve as you are no longer getting late night “last minute” requests for courses, or having to chase every single invoice every single time, or bundling in freebies just to keep them sweet. Just (nicely) let them go.
You can charge more than you think you can
Most start-ups want to undercut competitors to get going – and undercut by a long way, thinking they need to do this to get the Business. Whilst there is a cost element to some decisions (purchasing commodities such as printer paper or baked beans), a lot of Business is won, lost and retained for non-financial reasons.
If you are running a First Aid course for a dozen employees, that day is costing the Business (say) £8-900 in salaries, £100 in room rental, opportunity cost with having the employees unavailable, PAYE, NI and other extras anyway. Let’s say £1500 as a minimum. Will they really care whether you are charging £300, £400 or £500? Probably not in the grand scheme. Will they care that the Booking and Certification process was hassle-free and that the employees thought it a worthwhile day? Absolutely, and they will come back to you next time.
On the other hand if you charged £300 last time and now you are getting realistic with a bump up to £500 for the course will they care, will they notice? Almost certainly. That’s the problem with going in too low to start with.
You can also price yourself too low as well. If you were looking to Book a Hotel and you found one for £15 a night where other similar ones were charging £40-50 would you not stop to wonder what was wrong with that Hotel? There must be a reason why it is that cheap – and it’s probably not good news.
Go for it. Be bold with your pricing. Your skills are worth it. Would you rather work 3 days a week at £500 a day or 5 days a week at £300 a day?
People are buying a Service from you. You do not need to charge less because you have fewer overheads than a large Corporation. If they get the result that they want, they will be happy to pay £xxx for that and won’t care that less of it is swallowed up with admin than your big competitor.
PE – a colleague’s advice to me when I set up my first Business
This is a (non-comprehensive) list of Training Organisations that deliver “Train the Trainer” courses that allow you to get qualified – e.g. Level 3 Award in Education and Training (AET, old PTLLS)
They may also deliver First Aid Training. The list is alphabetical.
Owned and run by Maxine lock, a highly qualified and experienced Trainer. The Level 3 AET is delivered online with only one classroom observation needed to be face to face
Parts can be taken remotely. This is the Company that I qualified through (although the specific trainer has moved on). Happy to recommend the Organisation though. Very efficient and personable.
Training Organisations can get you qualified to teach First Aid. Trade Bodies and Awarding Organisations help you with your Certification.
When delivering courses there is a hierarchy of Organisations that you can choose to work through, however you can also self-certify your own qualifications. The Certificates can be equally valid for the qualification, however some Clients will insist on Accredited or Regulated Certificates as that way they know that what they are getting will be Nationally recognised. If you self-certify you may have to prove to your client that your certificate is equally valid. your Client will have to run due diligence on you to ensure that you are competent. If they obtain an Accredited or Regulated qualification that work is done for them.
Training Organisations
Training Organisations are available to provide ‘Train the Trainer’ courses. These allow you to become qualified to deliver First Aid Training to others. Sometimes the Training Organisations deliver First Aid qualifications in their own right or they choose to just deliver training courses.
Hierarchy of Training Bodies
Regulators
Regulators regulate qualifications, examinations and assessments. They do not interact directly with Training Organisations, but use Awarding Organisations as an intermediary. The exception being if a complaint has not been resolved by an Awarding Organisation (assessment decisions themselves will not get referred as far as a Regulator)
The Office of Qualifications and Examinations Regulation. This Government Organisation regulates qualifications, examinations and assessments in England.
The Scottish Qualifications Authority is the independent organisation responsible for regulating general and vocational qualifications in Scotland.
Awarding Organisations (AO)
Awarding Organisations act as an intermediary between a Regulator and a Training Company. An AO has a number of roles:
Create and have approved (by one or more Regulators) Regulated courses. These courses (e.g. First Aid at Work) are delivered and assessed to a defined standard and the Certificates can have the AO and the Regulator’s Logo on as a stamp of Approval
Approve a Training Company and its staff to deliver these courses. Approval entails ensuring that the Training Company has various Procedures (complaints, equality, privacy for example) in place and that they are current. It ensures that the Trainers are qualified & updated to deliver the courses and that the Training Company is insured and complies with current Standards.
Deal with complaints that cannot be resolved internally within the Training Organisation. It can refer upwards to the Regulator if it cannot resolve it, however Assessment decisions will not be referred.
Monitor the Training Company by audit of paperwork and visits to training courses (announced or unannounced)
Trade Bodies
Trade Bodies sit in the gap between Awarding Organisations and Training Companies. They provide an intermediary service that can be less onerous that getting a Regulated course delivered and assessed. Usually you can also obtain Regulated qualifications through them as they liaise with an Awarding Organisation.
For a list of Training Organisations, Trade Bodies and Awarding Organisations, click here
Thanks to the Health and Safety Executive (HSE) deregulating First Aid Training in 2013 the barriers to entry are pretty low. Whether that is good or bad is debatable. It does make it easier to set up as a Trainer – it certainly made it easier for me when I returned to teaching First Aid, but on the other hand it does allow trainers whose standards can be, shall we say, somewhat dubious, without all the checks and balances.
Those that can, do. Those that cannot, teach. Those that cannot teach, teach teachers.
Hmmm…..
Here are the minimum qualifications that you need:
A teaching qualification at Level 3 or higher.
An assessing qualification at Level 3 or higher
Occupational competency in the subject.
That’s it, qualification-wise. Obviously you need equipment, clients and a way of certifying but I cover that elsewhere. This post is about your qualification.
Teaching and assessing
These two often go hand in hand. Pre 2013 you could just hold a teaching qualification and you would need a separate person to assess your learners at the end of the course. You still need someone to assess, however the requirement for it to be a separate person is no longer there and you can assess as well as teach. It makes sense, therefore, that if you are starting from scratch that you look at gaining a qualification that covers teaching and assessing.
GEIS3 from the HSE includes a list of recognised teaching and/or assessing qualifications
Contains public sector information published by the Health and Safety Executive and licensed under the Open Government Licence.
The most common route for those without any qualifications is the Level 3 Award in Education and Training. It takes about a week and will qualify you for teaching and assessing and it is widely recognised. There are many ‘train the trainer’ providers out there that can get you through this qualificaton. See our list of some of them here.
Occupational competency
You need Occupational competency to be able to deliver First Aid training. As a minimum this could be the 3-day First Aid at Work course (FAW). Some Certifying / Awarding Organisations allow this to be a springboard to teaching a range of qualifications, however many will need to you get additional training. For instance, to teach Paediatric First Aid you may need a Paediatric First Aid qualification as well, since the FAW does not cover paediatric topics. Note the following:
The FAW needs to be renewed every three years so that you remain competent. Additional qualifications often only need taking once to give you a lifetime of competence.
A FAW qualification will allow you to teach FAW. Some subjects may require you to be qualified to the level above. For instance, Awarding Organisation QNUK will allow you to teach Outdoor First Aid with an Outdoor First Aid qualification, whereas ITC First will only allow you to teach it if you hold an Advanced Outdoor First Aid qualification.
Make sure that your FAW qualification is a Regulated qualification if you wish to work through an Awarding Organisation (AO). Because of the difficulty ensuring that non-Regulated courses meet the required standards, AOs often insist on a Regulated Certificate as it is easier for them to accept.
Most Awarding Organisations also need Annual evidence of Continuing Professional Development (CPD). It is not onerous – about 6 hours a year, but it demonstrates that you are keeping your skills up and expanding your knowledge. It could be as simple as taking an online course or attending a seminar.
Real life skills
As you can see from the above, you don’t actually need any real-life experience to become a First Aid trainer – the FAW is a qualification based on simulated casualties. In practice (and I appreciate that it is a generalisation) you tend to be a better trainer if you have some real-world experience – such as being an Event First Aider, or with a (military) medical background.
Some people with medical backgrounds don’t make very good teachers (they are not effective at communicating or their higher level of experience makes it hard to teach basic First Aid principles) and there are also very good communicators with minimal ‘real life’ experience. So yes, in some ways it is a sweeping generalisation but usually you will be a better Trainer with actual medical experience. If you have none, spend some time as a First Aider or a Community Responder. It will help you deliver your courses more effectively.
What do I need to do to become a First Aid Trainer?
Since the HSE deregulated First Aid Training in 2013 it has become very easy to set up as a Trainer. The obvious advantage is that it is a lot easier for you to start Training; the obvious disadvantage is that since anyone can start, the barriers to entry are low and there are a lot of Trainers competing for the same clients.
As a minimum you need the following:
A Level 3 or higher Teaching qualification
A Level 3 or higher Assessing qualification
A First Aid qualification – as a minimum a 3-day First Aid at work qualification
By having a teaching and an assessing qualification you can teach the courses and also asses the learners’ competencies. If you don’t have an assessing qualification you would need to buy in an assessor for each course that you delivered.
A First Aid qualification ensures that you have competency in the subject that you are teaching.
Is that really it?
Well, yes, however you will be restricted in what you teach and you may not make a very good trainer – which means repeat courses and recommendations may not follow. Whilst it is not always the case, generally speaking, to be a good trainer some form of First Aid experience with real patients / casualties is highly recommended. I totally accept that even the highest qualified medical staff can make terrible trainers, if you have dealt with casualties; with severe bleeds, medical problems and Cardiac Arrests you will be able to talk about the subjects from an experience point of view, not just something read from a First Aid manual.
Not only that, a First Aid at work qualification does not even give you the theoretical knowledge for teaching paediatric and outdoor courses – you should look to be gaining these additional qualifications. If you are looking to be a Freelancer then the more qualifications that you are qualified to deliver the more desirable you will become to prospective employers.
There is no point reinventing the wheel a lot of the time. Are you stuck on the Freelancer treadmill and want to break free? You can earn more and have more control of your destiny.
Lead generation – I can send you enquiries
It’s tough getting out there and finding new Clients. I’ve done that work for you. My websites regularly appear on Search Engines in front of people looking for First Aid courses. Subscribe to my Lead Generation package and warm enquiries will drop into your email inbox almost every day. Quote, win the Business and they are yours for life!
Business Development package – I can make sure you are visible and legal
I already own or co-own a couple of First Aid Training Companies. I have been running my own Businesses since 1997. If you are a starter or current Freelancer and want to take control of your destiny I can help you build yourself into a successful Business, where you are no longer tied to Freelancer rates and obligations. Run your own Training Company and get to keep all the profit in the Business. Subscribe to my monthly mentoring package and receive the following:
Benefits of working with me
Earn more, working directly with clients
At least one Guaranteed warm lead every month or your next month will be free. That will more than cover the cost of the monthly fee & if you get more than one lead, Happy Days.
Free Annual Monitoring visit. These normally cost about £150 to £200 if you pay someone to monitor you and you need one to maintain your status with Awarding Organisations.
Help getting your Business Website high up on the Google Search pages – the free bit, not the Google ads!
Help with a website if you don’t have one!
A friendly ear and advice at the end of the phone or email.
There are some great sources of inspiration from a variety of Podcasts. Here are some that I have been listening to.
Do feel free to send in your recommendations for either First Aid, Personal development or business development Podcasts. I’ll give them a try and if I like what I hear I’ll add them!
We currently use Podfollow to link to Podcasts as it will automatically redirect to the correct player. Please send us a Podfollow link when recommending.
The Apprentice runner-up, Saira Khan talks to some of the biggest names in British business, asking them about the challenges they have faced and how they overcame them. Each guest will provide listeners with guidance, insight and inspiration to help them develop the skills needed to grow a business.
Newly launched (4/2022) with a couple of podcasts. It would be better if Saira lets the guests speak more – it turns into ‘The Saira Khan’ show from time to time.
Whatever form your Business takes you need to keep records of your transactions and be able to file them at the end of the Year with the Inland Revenue. If you are self-employed the Year End will probably be 5th April in line with the Tax Year. If you have formed a Limited Company it will (usually) be 1 year from the end of the month of formation – which also makes the first set of Accounts filed more complicated as two sets need to be filed – one partial year and one complete year, with everything prorated.
I have tried a few packages in my time, so here are a few unbiased comments about packages.
Spreadsheets – Excel (Windows) / Open Office Calc (Windows / Linux / OSX) / Numbers (Mac OS)
Pretty much everyone starts here as it’s the obvious (and free, since most people will have a spreadsheet tool of some sort) place. There are plenty of free and paid-for templates for managing your Accounts and, of course, you can create your own. Literally all you need is a sheet with income, outgoings and Bank Balances then you can go. It does, however, get more complicated especially when you get to year end and you are trying to reconcile everything. When I started out I used one. I was also VAT registered from day 1 and it took two weeks to reconcile my first VAT return. It got quicker, but honestly the cost saving in not subscribing to a commercial package was far, far outweighed by my time in managing the spreadsheet. Spreadsheets have nasty habits of hiding errors and throwing hissy fits if you try and insert or delete cells and rows.
Unless your Business is really simple (and I mean a couple of transactions a week at most), don’t bother.
Standalone Accounts Packages
After my spreadsheet I bought a standalone copy of a popular package (Sage) following a recommendation by my Accountant. This was in the 1990s and the User Experience has improved since then but it was really hard work for a non-accountant. This was followed by another Brand, Quickbooks. Still standalone, but easier to use. I ran with that for about 15 years, well past its use by date but I was familiar with it.
I now use a variety of cloud-based packages. You can still get standalone, downloadable packages that run on your computer of choice, but I wouldn’t recommend them. Lack of versatility, irregular updates and inability to access remotely are some of the reasons. A cloud-based package is really the only solution. You are always working with the latest version, you can connect to it from anywhere in the world and can grant access to others, such as team members or a third-party Accountant.
Cloud-based packages
There are quite a few of these, each with advantages and disadvantages. Most have a limited functionality trial trying to draw you in. They work on the basis that if you have gone to the effort of typing data in you will be reluctant to sacrifice that effort. Don’t be taken in. Yes, it is an effort to duplicate but if you are not comfortable with a package don’t be afraid to abandon it. You have to use it for the next few years and need to have it work for you, not fight it. I’ve chopped and changed several times.
Making Tax Digital (MTD). This is coming. It is already here if you are Registered for VAT. You have to file your VAT returns digitally from now onwards – and that will come to Corporate Accounts at some point I am sure. Make sure that whatever package you use, it supports MTD. The only exception is if you use an Accountant and they can use their system instead.
Here is a potted review of some of the better known packages out there. All opinions are my own and features and prices correct as of June 2022.
Brief summary. I am in the process of moving all my Accounts to Quickfile as it is great value and uncomplicated.
X Payroll is an add-on, not available with the starter package
Very clean product. I have been using it for a couple of Businesses without issue. The only reason that I have changed for one Business is that at the transaction volume of the Business, the free version of Quickfile is better value for money. No other negatives.
✓ £ – starter package Free – up to 1000 Ledger entries per rolling 12 months, £45 + vat / year after that
✓ no limit to free trial as long as ledger entries stay under 1000 on a rolling 12 month basis
✓ No invoice limit (subject to above)
✓ Supports online VAT submission. Super simple to use once set up
X Payroll is not supported, but it integrates with The Payroll Site (£6.50 + vat / month)
X Sometimes you have to fill in fields where they could be left blank and the error message is not clear when this happens
I have moved two businesses to Quickfile, one because it was from a packages that did not support Making Tax Digital and I needed to submit VAT returns online. The other because Quickfile does all I need, but for free at the level of transactions being carried out compared to a monthly subscription.
This has been my ‘go to’ package for about 7 years, however as a standalone version. As packages are now online and Making Tax Digital requires online access I was forced to upgrade and Quickfile was my personal choice compared to the online version of Quickbooks.
✓ £ – starter package £12 + vat / month
✓ £ – 3 month 90% off trial – starter package £1.20 + vat / month for 3 months. £12 + vat / month after that
Turnover is vanity, profit is sanity, and cash is reality
anon
One of the commonest questions asked by new Trainers on discussion forums is “How much do I charge?”. The answer is not completely straightforward and those asking the question usually get several answers back.
The simple answer is “work out all your costs, add on how much profit you want to make and then charge that”. That is what you should be doing, irrespective what others are charging. If you don’t charge enough to make a profit then there is no point considering it.
Many people make the mistake of thinking “Well, I won’t charge much as I am starting out, then I’ll raise my prices once I am established. The problems with this approach are
When do I become established – at what point can I raise prices? By how much?
What will my existing clients think if I raise prices? Will I lose them, will they lose their trust in me as a value provider?
Have I dragged down the average price in the area – others may reduce prices to compete with you and a vicious spiral starts.
If you are too cheap, people will wonder why. That could be put people off.
Working out your costs
How do you work out your costs? Generally there are two, possibly three types of cost.
1. Fixed costs. For instance if you are running a public course, this would be the cost of hiring the venue. It is also the minimum you are willing to accept as income.
2. Variable costs. These are costs that vary according to numbers – e.g. Certification and manual costs, consumables such as bandages and wipes.
3. Hidden costs. Each time that you use your equipment it becomes a little bit more worn. It only has a finite lifespan and will need replacing. If you spent £200 on a manikin and it was worse for wear after 50 courses then it has cost you £4 a course. Multiply that by the number of manikins you use per course (say 3 for a full course) then that is £12 a course you need to put aside from the profit to replace them.
Having a mixture of fixed and variable costs, therefore, makes it really hard to work out the cost of running a course. The fewer that you have on a course, the higher the cost per learner. You may budget for 12 on a course but if 6 turn up, can you still make a profit? Do you run the course anyway so as to not let people down and give you a bad reputation or do you pull the plug?
What are my costs?
Here is a suggested list – it is by no means comprehensive but will give you an idea of what to consider. You may disagree with how I have categorised some items, that is fine as it shows you are thinking about it. Some items could conceivably be in more than one category. A printer could be viewed as a fixed cost for example as its cost will be spread over many students. There is, however, a small wear and tear cost per learner.
Fixed costs
Venue hire
Your minimum income
Fuel
Advertising
Variable costs – costs that vary per learner
Certificates
First Aid manual
First Aid consumables – dressings, bandages, cleaning materials, manikin lungs, faceshields
Hidden costs – could be fixed or variable but they all need to be factored in.
Depreciation / wear and tear
Holiday and sick time. You are not earning so the days that you are earning also need to cover non-earning days
Compliance, insurance, qualification renewal, quality assurance, CPD (Continuing Professional Development – courses and other learning to keep your skills up)
Dealing with queries, emails, ‘phone calls, missing certificates, misprints. Admin costs are still costs and take time, dragging down your average hourly rate.
From this, if you can estimate the number of courses you can teach per year you can calculate your cost per student and therefore how much you should be charging. Don’t forget to add 10% for contingency. Stuff breaks, gets lost / stolen. A course may not happen because of a misunderstanding, a vehicle breakdown, unexpected traffic. You need to factor all of this in. Plan for the worst and hope for the best.
example of first aid course costs
I recommend that you compile a list of costs (as above) then feed them into a spreadsheet, along with an estimate of the number of courses you can be expected to run each year. Then you can see in black and white how much you should be charging. You can create a spreadsheet yourself or you can use my template. The full version of this spreadsheet, where you can adjust the variables yourself is available in the Premium section.
Keep an eye on costs
It is so easy to get carried away. You may end up with money in the bank, but that can be an illusion. Don’t forget some of that is needed to pay tax at some point in the future, or to replace equipment.
On the other hand, having cash can give you the freedom to leap on a special offer, or get a bulk discount. My First Aid manuals for my Emergency First Aid at Work courses currently cost £1.95 each. I like the Personalised ones as that is advertising for me. If I buy 200 books at once, I get the personalisation for free (so free advertising) and the price drops to £1.50. Win, win. Recently my supplier gave notice of an imminent price rise, so I was able to buy ahead. I took advantage of a price break at 1,000, which mean they cost me £1.15 each and I see that my new x200 price is now actually £1.70. My 1000 books, cost me £1,150 this month, whereas buying 5 lots of 200 at the new price would cost £1,700 so I have just added £550 to my bottom line.
I could only do that because I had the cash in the bank (and also confidence that I will have that many students in the next 12 months or so).
Always be looking at costs and how to drive them down. There are always deals to be have. I upgraded my manikins in 2020. Nine were bought brand new at between 10 and 12% off List after a bit of haggling. Another 3 were bought from someone that bought them new, then had a career change. He had not even opened the packaging. He advertised on a Facebook Group. I happened to be online. I made an offer there & then, paid cash and completed my collection. Everything is negotiable.
A lot of people, when they get a bit of cash in think “Ooh, I’ll buy a few bits and pieces, maybe treat myself, upgrade my ‘phone” … and suddenly that cash is gone. No chance of grabbing a bargain and they struggle with the cashflow when the tax bill arrives. As it will. Install strict financial discipline from day one and you will get into good habits that will help your business grow further down the line.
The other thing that can happen over time is that stuff accumulates. Old equipment. Items you bought that seemed a good idea at the time. Anything that still has some monetary value that you don’t use should be sold off. Not only is that cash that is tied up, you may also be paying rent to store it somewhere. Get rid of it, put the cash in your bank instead.
Finally, take a look at “Managing my clients” for more tips on becoming more profitable.
