--- title: Minimum Enrollment To Meet Break Even Point description: Is it better for the image of the department to cancel the class OR do think it is acceptable to implement any methods that will allow in a reduction of expenses to meet the break even point if enrollment isn't met. --- [LERN Club Sign-In](http://beta.lern.org/club/) [![lern-logo.png](https://blog.lern.com/hubfs/June-folder/lern-logo.png "lern-logo.png")](http://lern.org) ** # Questions # Minimum Enrollment To Meet Break Even Point Feb 14, 2019 4:17:37 AM by Jordan Kivley | **Q: **If a class is slightly short of minimum enrollment needed to break even, do you think it is better for the image of the department to cancel the class OR do think it is acceptable to implement any of the following methods that will allow a reduction in expenses to meet that break-even point? ·         Reducing instructor wage ·         Reducing the number of weeks offered ·         Reducing the number of hours held ·         Asking the students to pay a higher fee Our previous philosophy has been to retain the students whenever possible by allowing them options (to which they can decline and choose cancellation as an option).  If this were to occur frequently with the same class, obviously we would be taking a hard look at the need for the program and future decisions on offering it again. In classes where the minimum is 10 and we achieve 8 or 9 enrollments, we felt it was too many students to disappoint and potentially lose. A concern has been stated that modifying the class from its original format makes us look as though we’re offering a sub-standard program and that it might be better for our image to cancel.   **A: **First, you should know that “Break Even” is not the same as “Go No-Go.” With break-even, you are covering your direct costs (brochure, instructor) but not staff or overhead (your salary, for instance). With Go No-Go, you are covering only your production costs (instructor), not your promotion costs,and of course not overhead. The reason financially you Should run a class or event at the Go No-Go point is that you’ve already spent (and lost) promotion costs. So if you can recoup your instructor costs, then you can run the class. Now, you obviously are still losing money, and maybe you don’t run the class the Next time, but at the Go No-Go point you would run the class. When you run a class at the Go No-Go point, you are “saving” a registration (and more importantly customer) and you stand a better chance of getting that customer back for a more profitable class. Whenever you cancel and turn people away, you run a greater risk of them not coming back. So you want to cancel as few activities and classes as possible.  Non-financially speaking, or aside from financial considerations, some programs do run classes and activities even if losing money, even if not at break even, even if not at Go No-Go, simply to keep more customers, to avoid having people tell others a class was cancelled, for image both with customers, and with the community.  One program ran a class with just 3 people, at a loss, for that reason. A couple of years later one of the 3 people donated a zillion dollars to the organization. There are some things that are acceptable and recommended, and some items you listed that we would not recommend you do. Recommended: -Three days to one week before a class that might be cancelled is supposed to start, email the existing participants and ask them to email and recruit a friend to the class so you have enough people to run it. -Ask the instructor to take less pay.  Less is better than nothing. Not Recommended:   We would not suggest you do these things you listed: -Reduce number of weeks -Reduce number of hours -Increase the fee (this time). All of these things you have put in writing in a brochure and/or on your web site. All of them you are obligated to do.  This is not legal advice, but before doing any of them you should seek legal advice. Now raising the price the NEXT time the class is offered is a terrific strategy.  IF there are only 5 people out there for any given offering, and IF they value it, let them demonstrate that and let them financially “decide” whether it’s worth it.  Many times, especially in recreation programming, classes and activities are underpriced anyway. 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