VietNamNet Bridge - Higher education is not always a guarantee of success, but many people are willing to spend a lot of money to gain an advanced degree, making the education sector a highly profitable business field for investors.

The education sector is a highly profitable business field for investors.

Reports show that the number of state-owned and non-state owned universities increased sharply from 2000 to 2013. In 2000, Vietnam only had 178 schools, while in 2013, it had 427, an annual growth rate of 6.5 percent. 

The increase in the number of universities and junior colleges was even higher than the increase in the number of students in that period, 6.5 percent vs 6.1 percent.

The major difference between state-owned and non-state owned schools is their sources of revenue. While tuition just accounts for 45 percent of revenue of state-owned schools, it is the biggest source of revenue for non-state owned schools. 

While state-owned schools can operate well with funding from the state, private schools have to think carefully before they spend money.

Private schools and training establishments have been increasing as a result of the state’s open policy which encourages investment in the educational sector. RMIT Vietnam, VUS (Vietnam USA Society English Centers), FPT Education and Apollo English Centers are the best known names.

Of the ‘big four’, RMIT is not the earliest established school (it opened in 2000), but is the school with the most impressive revenue – over VND1.1 trillion. However, this is the only non-profit organization of the four schools. 

While tuition just accounts for 45 percent of revenue of state-owned schools, it is the biggest source of revenue for non-state owned schools.

All the profits of RMIT will be put into re-investment, while the school’s shareholders cannot expect dividends or other benefits. This explains why RMIT has the lowest profit margin, 5.5 percent, despite the high revenue.

Though VUS and Apollo are both English centers, their business performance is quite different. VUS opened later than Apollo (in 1998). VUS only has English centers in HCM City, but its revenue is three times higher than Apollo’s.

While Apollo has 19 centers located throughout cities in Vietnam, VUS only has 15 centers in HCM City.

Apollo’s profit margin is also lower than VUS’s, 7.1 percent vs 22.36 percent.

However, it is FPT Education which has gained the most impressive results in performance. This can be shown in its profit and revenue.

The school of FPT, Vietnam’s largest information technology group, received revenue of VND590 billion in 2014, but the profit was VND171 billion, a profit margin of 29 percent.


NCDT