Perpetual programs vs term-based programs in your class-based business

If you run a lesson-based business, such as a swim school or tennis club, you may already be familiar with perpetual and term-based schedules. But if you’re new to the business or are wondering what the difference is and how to decide between the two, then this resource is a great place to start.

Let’s start by differentiating the two.

What is perpetual?

Perpetual programs run throughout the year - once a customer is booked in, they will remain in the class until they tell you otherwise. For these ongoing programs, fees are usually raised weekly, fortnightly or monthly.

What is term-based?

A term-based program has a start date and an end date, usually following the school term. Fees are raised for the period of the term; most businesses will then roll over the term and include the sessions and bookings so that customers remain booked in for the following term.

Perpetual and term-based comparison

Now that you’re familiar with the terminology, let’s dive deeper into the benefits and drawbacks of each.

Perpetual program pros and cons

Pros

• Ideal for schools and clubs that run classes all year round
• Fees are paid throughout the entire year, promoting a healthy cash flow
• Easier for parents as there are no scheduled breaks they need to be aware of
• No breaks between programs which help students maintain progression
• Can still run holiday intensives alongside your regular schedule (e.g. after morning classes have finished)

Cons

• Need a year-round team of staff to maintain classes
• Can be hard to set goals/milestones as there are no program end dates
  

Term-based program pros and cons

Pros

• Good for those that follow the school term schedule
• Easy to set progression-based goals as there is an end date to the program
• Easy for parents to follow as classes run alongside the school term
• Can set up school holiday programs to increase revenue and fast-track student progression
• Ability to update timetable at the end of each term if something needs to change

Cons

• Fees are only paid per term, disrupting your cash flow during holidays
• Disrupts students’ progress and routine as they have breaks between programs
• Potentially harder to find staff if they won’t be working (and therefore paid) during the holidays
• If your business does not rollover bookings from the previous term, this is extra admin work and requires customers to rebook (potentially leading to drop-offs)

If you're still unsure about whether to go perpetual or term-based, speak to our team of experts who will be able to further explain the pros and cons of each in relation to your specific business model.