While the strong demand will always be there for private education, that demand comes from less than 5% of the parents of schooled children based on Stats SA metrics. In the big picture, SA's population growth rate has been in a downtrend from 2.48% in 2011 to 1.18% in 2012. Birth rate per 1000 people halved in the past 40 years. The population, which includes immigrants, is positive but slowing. The population segment who can afford private education also has the lower birth rate when compared to the lower-income groups. So the private education "market" is not growing from a long-term perspective. So it stands to reason that to sustain growth and profits, providers can only do two things: reduce costs and increase the share in the existing market. Reducing fees will increase market share over time, but greatly reduce profits on already-tight margins.
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