This week, I listened in on a conversation between a group of instructors who were discussing their hourly rate. One of them had recently increased their rate to £35 per hour; a concept that was met in some quarters with a gasp, and in others by a raised eyebrow. I’m unsure if it was incredulity or jealousy that yielded such a reaction, but it was clear that everyone found the revelation difficult to comprehend.

Talk the Talk

As I earwigged, it became clear that most had only recently increased their prices to £30, and I could tell there would’ve initially been a sharp intake of air when that happened too. The discourse revealed that a national school operating in the area were now charging £32.50 per hour and so, using this as a guide, the consensus was that perhaps they could possibly raise their rate to £32. The ongoing fundamental and frustrating challenge faced by instructors is how to value their time, and the conversation made me want to stand and say: “If they’re charging £32.50, why not go higher, rather than lower? Are their instructors worth more than you?” I know the answer would’ve been a cautious “No”, but without any real belief in their answer. This is because they had little confidence that they could command it and, what’s more, that people would pay it. And yet, whenever I have asked: “Did you experience a reduction in new customers the last time you raised your prices?”, the instructor always shakes their head.

Walk the Walk

Personally, I would always honour the price you agree at the start of your training with each student, but there is no harm in regularly increasing your prices for new students, even if they are a referral from an existing customer. Costs/demand will have usually increased since you started teaching the referrer, so the price should reflect this, just as with any other product or service on the open market. Given that they’re a referral, they’re even more likely to accept this and sign up with you! Clearly, if you double your price over night, there is likely to be a negative response from the market, and your phone won’t ring. That is, unless you can demonstrate the value that makes the cost worth it. However, regularly increasing your price by a few pounds will undoubtedly have a positive effect on your bottom line, without so much as a ripple in the pool of new drivers requiring your service.

Here are five elements that help dictate business success:

1. Market forces – the market will decide how much you’re worth; you don’t have to. You’re supplying a service that people are demanding, and the more people demand it, the more you can (and should) charge for supplying it. If you find that the enquiries are drying up, reduce your price again until the phone begins to ring. Remember, potential customers are buying the service – not you. If others are charging more than you for that service, then you’re simply losing out on potential profit. Supply and demand: currently there are not enough ADIs to meet the demand, making this the perfect time to increase your rates for supply.

2. Price check – regularly check what other ADIs and schools are charging in your area. You need to decide how you compare to those instructors: are you more reliable, drive a nicer car, get better recommendations etc? Lower rates tell the market that you don’t value yourself as highly, and that doesn’t fill customers with confidence.

3. Your investors – who has a vested interest in your business, the student or you and your family? Whilst it’s great to offer superb customer service, to care for your students and even to become a friend or confidant, you’re ultimately responsible for your family and the opportunities you can create by earning more. You’re a business, you’re not a charity.

4. One to many – there seems to be a psychological barrier surrounding price increases. But while it may mean hundreds, if not thousands more per year for you, the increase per pupil is actually unremarkably small. Remember, if a new customer pays £3 more per hour, the new price is all they’ve ever known. It’s insignificant to most. To you, with 30 hours to sell, that’s an extra £90 per week; £4,000 per year, so it seems like a bigger deal to you than it really is.

5. Rising costs – don’t think for a moment that fuel suppliers, car manufacturers or advertisers will think twice about extracting every last penny they can from you. The constantly rising fuel prices we’re witnessing will have an impact on your profit margin, so relieve that pressure by increasing your price accordingly.

Because You’re Worth It

It’s vital that, as a business, you not only protect your livelihood in response to increased costs, but that you maximise the income you can generate with every hour you work. You never know when an issue may arise that prevents you from earning, so make hay while the sun shines and don’t think twice about it. Again, people are buying your skills, not you, so set your prices based on business reasoning, not based on your perceived self-worth as an individual. What’s more, if you charge low prices, then you are only encouraging others to follow suit and, soon enough, the whole industry is undervalued for the service it provides. Driver training is a life skill, an education in safety, giving people freedom and independence, while also keeping the wheels of the whole country’s economy moving. Now, become your area’s top earner and go reap the rewards of your valuable hard work!


Dan hill –