Let's Japan.org Debunking Eikaiwa and Ramblings in Japan

When the largest English conversation school goes under, it has a ripple effect.

The Japan Times

Revenues in the foreign-language school industry fell more than 40 percent in September from the previous year because of the downfall of industry leader Nova Corp., government data indicated Thursday.

Total revenues at the schools, which mainly teach English, slid 43.3 percent to ¥7.32 billion, falling for the ninth consecutive month, the Ministry of Economy, Trade and Industry said in a monthly services industry survey report.

Granted, these figures are for all foreign language schools, but since Nova was such a dominate player, as Nova goes, so goes the market. The METI statistics say revenue has fallen for the past nine months.

All of the pertinent statistics can be downloaded from here [the data is in Excel files and has notes in English. Scroll down to 外国語会話教室, the fourth item from the bottom of the list]. Let's start from September 2006 and work our way to the present.

September 2006: ¥12, 898,000,000, a year-on-year decline of 8.7%

October 2006: ¥9,021,000,000, a YOY drop of 4.9%

November 2006: ¥12,195,000,000, a YOY increase of 46%

December 2006: ¥10,488,000,000, a YOY increase of 16.6%

January 2007: ¥10,271,000,000, a YOY decline of 22.7%

February 2007: ¥10,751,000,000, a YOY decline of 37.7%

March 2007: ¥13,742,000,000, a YOY decline of 5.9%

April 2007: ¥6,656,000,000, a YOY decline of 35%

May 2007: ¥6,627,000,000, a YOY decline of 24.5%

June 2007: ¥7,508,000,000, a YOY decline of 18.4%

July 2007: ¥7,168,000,000, a YOY decline of 20.6%

August 2007: ¥7,485,000,000, a YOY decline of 28.6%

September 2007: ¥7,317,000,000, a YOY decline of 43.3%

We know what did Nova in: a poor business model and Sahashi running the show by himself. Trans-Pacific Radio's latest BizCast fleshes out the problems with Nova and eikaiwa in general, in some more depth.

Some of the ground they cover: loss of consumer confidence, Nova's broken business model, poor quality control, and questionable management. Discussion of the eikaiwa market takes place in the last 20 minutes of the podcast and starts at around the 38-minutes mark. It's definitely worth a listen.