Macro Environmental forces that affect the survival and growth of child education center in Singapore
2.1.1 Baby boom (population increase)
According to our research, it can be seen that Singapore’s population is increasing slowly from 4 million in year 2000 to about 4.5 million in year 2007. Also, Singapore’s crude birth rate has been fluctuating from 10 to 10.3 per 1000 population. Assuming that Singapore’s crude birth rate will stay around that range in 2008, this would mean that there will be a steady number of babies being born in 2008. And with babies this would mean that there will be demand for an educational centre.
Furthermore, with the Singapore government implementing new policies (e.g. baby bonus schemes) in order to encourage newly weds to produce more babies, this would definitely help our business as there will always be a demand for such educational centre.
2.1.2 Income level
Base on our research, the income level of Singaporeans have been increasing over the past few years. Our group has actually found a document on the internet which shows the average household income from work per household member, and from that document we can see that there is a significant increase from the earnings in 2005 to 2007. (E.g. yr 2005 – 1820, yr 2006 – 1950, yr 2007 – 2140) Thus with a higher income level, their spending power/disposable income will increase. And this would mean that parents are able to spend more money on their child’s education.
Chart 1: Annual Change in Average Monthly Household Income from Work
2.1.3 Government Policies
The government has implemented a few policies in order to encourage Singaporeans to give birth to more children. Policies such as the “Baby Bonus Scheme” and longer maternity leave for pregnant woman, Infant Care Subsidy and the setting up of the WoW! (Work-life Works!) Fund. With these policies, more people will be enticed to have babies in order to receive the benefits that the government has laid out for the public.
2.2.1 HFMD/Sars/Bird Flu (Communicable Diseases within Children)
In the event of a breakout of HFMD/SARS/Bird Flu, all children related places will have to exercise caution and if there is a student who has any of the above illness, then our enrichment centre will be forced to shutdown for a period of time. This will be a disadvantage to us because it would mean a loss of profit due to the closure.
2.2.2 Culture of Singapore
Many people in Singapore are obsessed with trying to earn as much money as possible. This leaves little or no time to have babies. Even if they do have babies, they will probably have only 1 child in the family. This will have an adverse effect on our business because if they are too obsessed with earning money or just having one child, there will be a lesser demand for educational centers’ targeted at kids.
There are many children education centres (E.g. Mindchamp, Super Kids, Tony Buzan Learning Centre), that have the same target market as us. Over the years, there has been an increase in the number of children education centres in Singapore. This has a negative effect on us because parents will now have more choices to choose from and decide which best fits their child.
.2.4 Rise of prices
According to our research, it can be seen that food prices will increase and this would mean that Singaporeans will have to put aside a larger portion of their disposable income for their grocery shopping. Which in turn means that there will be lesser money spent on sending a child to an educational centre. Resulting in the parent settling for a cheaper educational centre.