Models and Budget Forecasting

Case Example

A small private school was concerned that its tuition and enrollment model needed refinement. Specifically, they wanted to understand if net revenue gains were possible through increased tuition or was their only solution increasing enrollment through new programs? NACUBO Consulting was asked to create a predictive model of the current pricing strategy and simulate increased tuition on yield and enrollment numbers, including program-specific tuition or fee increases. The school had worked with another enrollment firm prior to their engagement with NACUBO, but senior leaders wanted a deeper dive.

Among other findings, the model found that increasing student headcount by more than 125 additional students would require a significant increase in discounting and also result in decreased net revenue and unnecessary increased expense to support these additional students. As a result, the institution is now focused on modest enrollment growth with no growth in their discount rate, plus a greater emphasis on retention. The model also identified two groups of students who failed to attend despite expectations and, more importantly, a demographic profile of these students. Moving forward, these subpopulations will now be targeted with specific outreach and individualized need-based aid allocations.

By testing and recalibrating predictions, NACUBO consultants were able to advise senior leaders on their strategic enrollment goals, narrowing their focus to the most effective practices in a difficult time.