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News from ISC Research - August 2020
News from ISC Research - August 2020

What is the future of international school development in China?

53 new international school campuses were scheduled to open in China this September 2020. Now, according to a new report from ISC Research, 52% are likely to open as planned, 22% have delayed opening for 12 months, and 22% have postponed plans.

There are several reasons for these delays or changes in plans, reports ISC Research. Most are unrelated to COVID-19 and instead focus around China's reforms to regulate private education.

COVID-19 has, however, influenced the way that some parents are now judging and selecting international schools. Some parents are now seeking guarantees that a school is well prepared to deliver meaningful distance learning, and others want reassurance of some level of reimbursement for any significant change to a school's offer before making their selection.

COVID-19 has not made it easy for schools that are preparing to open for the first time this September to market themselves. For some new schools where construction is complete, online tours or virtual 'meet the head' sessions have been the solution. For other schools, construction delays as a result of the pandemic meant that some school leaders have not had a completed campus to show to prospective parents. However, capacity of the construction workforce in China means that the doors of new schools planned for September will realistically open. Such tight turn-around is not easy for school admissions. One school leader compared it with buying a new property "off-plan". In such cases, September 2020 will likely see small student cohorts, although for most new schools in China, enrolment targets are expected to be achieved by 2021.

More schools are likely to open in China in forthcoming years. According to the new International Schools Market Intelligence Report for China from ISC Research, China's current international schools market is worth USD 7.5 billion in total annual tuition fee income. 200 new schools have opened in the last 5 years and student enrolment has increased from 270,400 to 395,600; a compound annual growth rate of 7.9%. Almost all growth during this time has been for the schools that are accessible to local Chinese children; the Chinese-owned private schools. Several of these have a service agreement with a foreign independent school brand in order to introduce some Western approaches to learning, such as critical thinking, entrepreneurship, analytical thinking, creativity, and a stronger focus on wellbeing and pastoral care. These qualities within education are now valued by many parents in China and other countries throughout Asia. The schools that deliver other international elements, such as some learning in English and international exit exams, are also considered a reliable preparation for global higher education and careers.

As independent schools around the world look to alternative sources of revenue to redress financial challenges resulting from COVID-19, so the number of brands considering international development opportunities could increase. This is particularly likely for independent and private school brands from the UK, US, Canada, and Australia.

Opening a brand campus in a country where demand for a Western style of education is high, is increasingly appealing to independent schools that have an educational heritage or reputation that will appeal to aspirational families. However, the international private school market in some Asian cities is becoming increasingly competitive. As a result, new schools will need to demonstrate their qualities and values, and find unique selling points to differentiate themselves.

Details of future international school growth and development in China are included in the new China International School Market Intelligence Report from ISC Research. It is one of 16 detailed International School Market Intelligence Reports for purchase from ISC Research for countries that have most demand for new international school development around the world. For schools and investors considering best location options, the new Global Opportunities Report from ISC Research, which will be released in September, provides key market comparisons for informed decision-making and is available to order now. For more information contact will.bedford@iscresearch.com

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