Here is an email we got from a tutor the other day. I thought it was worth re-printing in case others have a similar question:

I am a tutor at universitytutor.com. I really love your website and the recent innovations you have made including client rating and profile updates.

I just saw an email in regards to you setting up a new system with clients paying a markup on tutoring. I don’t know how efficiently this will work.

I work as a tutor and I am also currently going to school. It seems like a lot of money to pay by students just for getting tutored, they might also go to other websites or go to school learning centers to get the necessary aid.

Does this sound logical? I am just sending my thoughts and concerns because I really love your website.

Sincerely,
[name removed]

Hi [name removed],

Thanks for the email, I really appreciate your feedback! I think you’re right that the markup could cause a problem for some students. You may want to keep any existing clients you already have at your old rate so they don’t get an unexpected price bump. This tends to upset people more in my experience – unexpected changes – whereas if if a student knows the price up front then its unlikely to be an issue.

As for future clients, I don’t think it will be as a big of an issue as you might think. I know that when I first started tutoring, I “went out on a limb” and decided to charge $35 per hour which sounded like a lot to me. People paid and things went fine. I started meeting other tutors who claimed to be charging as much as $60 or $80 per hour, and I didn’t really believe it, but as I got busier I decided to raise my prices from $35 to $45. I figured I’d lose a good chunk of people but it was ok because I was getting busy. Remarkably, of the 30 or so clients I had setup with a bunch of tutors (it wasn’t just me at this point) I think only one expressed concern and decided to stop. There was zero drop in new business.

A few years later I had a “real job” and decided I wouldn’t have time for tutoring, but just as an experiment I’d put my rate at $65/hr just in case someone was really desperate. Incredibly, I saw no drop in business and new clients kept coming in at this rate. By the way, my “real job” was paying $25/hr so that tells you something.

Of course, by this time I had quite a lot of experience tutoring, but part of it was just that I didn’t realize how valuable it was to some people. In some professions (accounting, medicine, etc) it’s not uncommon to charge $500 per hour and up. Is it worth it? Well, if you REALLY need the IRS to get off your back or REALLY need your new kidney to work correctly, then yes it might be worth it. Similarly, if you REALLY need to pass biology this year, it might be worth it if you are the best biology tutor in town.

While there is occasionally free tutoring to be found (of dubious quality), keep in mind that your main competition comes from big tutoring companies like Kaplan and Silvan who have million dollar marketing budgets. These companies often sell their tutoring in “blocks” or “classes” which hide the true dollar per hour figures, but if you price it out it’s not uncommon for these classes to cost upwards of $85 per hour (and the markup on that is about 50% so the tutor is getting half). By these standards, the tutors on UniversityTutor.com are a steal.

I’ve actually been surprised by the prices that most tutors are putting on the website around $20 or $30 per hour. Every market is different, but in general I think most of the tutors on the site are pricing themselves too low. I don’t blame them because when I was a college student and the best jobs on campus paid $10 per hour, I didn’t believe it was possible either. But tutoring is not a commodity like a gallon of gasoline where the only way to compete is on price. Some tutors are much better than others and can command a much higher price. For better or worse, price is often used as an indicator of quality when people shop so it’s even possible that putting a higher price could actually result in MORE inquires from students who are looking to hire the best.

Anyway, I hope this helps and thanks for the feedback! We always like to hear from our users.

Thank you,
Brian Armstrong
www.UniversityTutor.com

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