China's Junior English Training

China’s junior English language training businesses, which mainly targets teaching children aged three to nine, have been hit by the COVID-19 outbreak due to the close of offline learning centers. Training providers had tried to shift the offline courses online, but that was not well received by students or their parents.

According to Oliver Wyman, the broader English language training market for learners aged three to 18 reached RMB 90 billion in 2019, achieving a compound annual growth rate of about 40 percent over the past four years. Even though the training businesses segment is expected to suffer a serious economic blow in 2020, we estimate the segment will maintain considerable growth in the long run, driven by the increase in penetration rates.

In this paper, we discussed the past growth of junior English language training market in China and shared our thoughts on its development after the epidemic subsides. We expect that the main model will remain offline, while leading players have made attempts to combine online and offline teaching to enhance market penetration. On the other hand, as the epidemic will likely overwhelm some small and medium-sized institutions, the environment is ripe for market integration, and leading players will probably actively pursue acquisition and merger opportunities to expand their market share this year.