Child care is an important service in today's economy and is a matter that many parents think about. Opening an affordable and reliable daycare will meet that important need because it means you can ease the worries of the parents. At the same time, child care is sometimes so expensive that it makes more sense for only one parent to work and the other to stay at home. Sometimes, child care costs even more than tuition. If you make the decision to open a home daycare, you will earn extra income while taking care of your own children.
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Part 1 of 3: Drawing up a Business Plan
Step 1. Understand the need
There are many reasons why child care businesses are so economically reliable. Are you the right person to help families adjust to the realities below?
- The majority of today's families do not consist of working fathers and mothers taking care of children. This means that both parents work together.
- The new type of economy demands a lot of shift work. This means that more people work at night and on weekends.
- Sometimes, one parent works during the day, and the other works at night.
- People delay retirement, and that means grandparents can't take care of grandchildren.
Step 2. Evaluate your strengths and weaknesses
If you are planning to open a daycare center, you may like children and understand that taking care of children takes a lot of energy and commitment, but that is not enough to support a successful business. There are several other qualities you need:
- Professionalism and business ability
- Willingness to take risks
- Ability to manage staff
- Access to sources of funds
- Organizational and administrative skills
Step 3. Think about the situation in your community
After determining that there is a need for child care in your area, think about the specific types of services you would like to provide. You've decided to open a home daycare instead of a commercial location, but there are many other considerations to consider.
- Study demographic data. How many toddlers are in your area? This information can be obtained from the Central Bureau of Statistics or local government offices. Also, consider holding a meeting with parents to get this information.
- How many daycare centers are there to serve these children? You can find this information from your local government office, child care association association, or telephone/internet book. Once you have a comprehensive list, contact each of these places to find out what fees they charge.
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Is there a need that is not being served by the day care center? There may be an age or time range that is not accommodated. If yes, that's your chance. Consider the following service options:
- Custody on weekdays
- Care before or after school hours
- Night care, overnight or weekend
- Care for specific age groups
Step 4. Prepare initial funds
How much money is needed, and how long can you collect it? Or, if you take out a loan, how long will it take you to pay it off? Costs and revenues must be calculated to determine the financial viability of this plan.
- What equipment to buy? Remember that this is not a one-time fee. You should update your equipment regularly. Children's equipment includes toys, games, books, arts and crafts materials, outdoor play equipment, and others.
- What changes, if any, are needed to make your home safe for children?
- How much do permits and insurance cost in your area?
- How much does it cost to provide meals and snacks for the children in your care?
- How many children can you care for at home?
- Do you need to hire additional staff, and if so, what are their salaries?
- How much will you charge the parents? Is the fee sufficient to cover all expenses? Or, is the cost big enough to keep parents away?
Step 5. Choose a name and business entity
The name of the daycare should be simple, catchy, and easy to remember. The business entity depends on the type of child care you want to run.
- Most home-based daycares are sole proprietorship. While this structure is the easiest and cheapest, you have to pay both business and personal taxes together.
- Consider the form of the corporation if you are hiring someone else. You may need to pay higher legal advisory fees and taxes, but your property will be protected. Another option is a Limited Liability Company, but the parts of your home, furniture, materials, etc. that you use for child care services will not be protected.
- Choose a form of partnership if you and a trusted partner have complementary skills and are willing to share the work. While this means that you and your partner both participate in business decisions and receive an equal share of profits, you are also equally liable for losses.
Step 6. Find a source of funds
The government provides affordable funds and loans for people who want to set up child care businesses. See if you qualify for the program to ease the establishment and operating funds.
Part 2 of 3: Getting Permission
Step 1. Find out the requirements for obtaining a home daycare permit
This process may vary in different regions, but has many common elements. The Local Government Office will assist you and provide the requirements for obtaining a permit.
Step 2. Follow the required orientation
Some regions specify that you cannot apply for a permit if you have not attended orientation. Orientation is usually free and sometimes available via the internet. Orientation aims to:
- Helping you decide if you want to open a daycare
- Determine if you are eligible to open a daycare
- Informs what you must fulfill before opening a daycare
- Understand security regulations and requirements
- Provides information on adult-to-child ratio and staffing issues
- Introducing best practices in parenting
Step 3. Fill in and submit your application
The requirements application will tell you where you can submit the application although it usually has to be submitted at the Local Government Office. Along with identifying and residential information, you will also need to provide some or all of the following:
- Letter of reference or recommendation
- Medical information, including tuberculosis screening
- Information free from criminal records, namely SKCK
- A background check letter for everyone living in your home (including staff) over the age of 14.
- Cost
Step 4. Get training
There are a few things you need to know to run a daycare successfully. Before obtaining permission, you must demonstrate an understanding of the following:
- First aid, CPR and emergency preparedness
- Discipline and activities that are appropriate for the child's age
- Health, nutrition and child development.
- Your home is safe for children
- Communication with parents
Step 5. Get the required insurance
Home-based daycare must have fire, theft, and liability insurance. You should also make sure that homeowners insurance covers the materials you buy for this new venture.
Step 6. Receive a home inspection
Before a child care business can open, your home must be inspected to ensure the safety and health of the children and that you have taken into account the child's needs for education, entertainment and discipline.
Part 3 of 3: Running a Business
Step 1. Have detailed records
This is where your administrative skills will come into play. You must record all expenses and income, both personal and tax.
Step 2. Charge an affordable price
In some cities, baby and child care costs more than tuition. This situation forces parents to really consider whether they can afford to put their child in day care, or whether it makes more sense for one parent to stay at home.
- Funds and loans allow you to lower prices.
- Maybe you qualify for a tax credit.
Step 3. Stay informed about the latest developments in psychology, educational theory, and child health and safety
Even with the most stringent permit requirements, there is no guarantee that daycare provides high-quality care. Differentiate your services by becoming an expert in children's development, education and nutritional needs. Consider taking courses at your local campus, which are usually relatively affordable.
Step 4. Communicate with parents
They don't know the specialty of your place if you don't tell them. Consider distributing weekly or bi-weekly newsletters highlighting their children's activities. It would be better if you attach a photo.
Step 5. Don't neglect marketing
There are many daycare centers that say the demand for services is so high that they have a waiting list despite not doing any marketing. However, if your business is just starting out, establish a reputation as a professional business.
- Look for professional graphic designers and writers in your area.
- If you work with people who have children, you may be able to trade babysitting services for their services.
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When developing a marketing plan, think about the same questions you considered when deciding on the type of service to provide (and make sure your materials describe those services accurately to avoid confusion).
- What target audience do you want to reach?
- How do your services differ from those they are currently using or considering?
- What characteristics would you like to emphasize? Attention? Flexibility? Affordable cost? Choose the most important characteristics, and use them to form a consistent and attractive image.
