Parents are increasingly having to work more jobs or longer hours to make ends meet — that means there’s never been a greater need for reliable daycare organizations that can take care of the little ones. If you have experience looking after children, then starting a daycare business could be a great idea.
You’ll need a combination of childcare experience, people management and administrative skills. The right daycare marketing and a solid business plan will give you a great launching pad to appeal to parents.
We want to help you get your daycare business off the ground. Since 2004, we’ve helped over 100,000 people to become entrepreneurs, starting exciting businesses and bringing their ideas to life. We’ll give you the support, guidance and advice you need to create a daycare business and make it into a success.
From validating your childcare business and doing the research to filing your paperwork and running your business, this guide will help you out. We’ll talk you through the main things you need to do to get your daycare business off of the ground.
Read on for some insight into creating your own childcare organization and becoming an entrepreneur.
Although it can be exciting to form a daycare business, there will be significant demands on you as a small business owner. Here are some of the things you can expect.
Here are some of the typical tasks you’ll be performing for your daycare business on a daily basis:
The following skills will be very useful in your role as a daycare small business owner:
Your daycare customers are going to be parents who are juggling kids, work and other responsibilities. They're looking for a daycare organization they can trust to provide safe, affordable childcare to their children, while keeping them engaged and entertained. If you can meet those needs while managing the administration of your business, your daycare will thrive.
There are several different types of daycare business that you can start. Here are some of the more popular options:
Many large employers provide daycare services to their employees, either onsite or remotely. Understanding the services that employers need and getting in touch with their HR departments could be a great way to get a foot in the door.
You might consider running a specialized daycare center for particular children. For example, you might offer daycare for children with special dietary needs like being gluten-intolerant or vegetarian. You could also offer daycare services for children with mild learning or physical disabilities, if you have the right training.
Some large daycare businesses have franchise opportunities. In these circumstances, you pay a franchise fee but get brand recognition, support and advice on how to set up and manage your daycare business.
The areas we’ve listed above are just starting points — there are many different types of daycare businesses. Once you’ve identified specific daycare areas you might like to go into, you need to validate your daycare business idea.
Remember too that every daycare business will have many competitors. You will need to stand out and offer superior childcare to excel as a daycare business owner.
Not every idea you have will make it through to becoming a daycare business. There are all sorts of reasons to say “yes” or “no” to specific ideas and approaches — think about what your strengths and weaknesses are so you can choose a type of daycare business that you’d be great at.
You might think your daycare business doesn’t need a business plan, but you’d be wrong. You will need to clearly understand and capture how you’re going to run your daycare business, market yourself, get sales, make a profit and grow. This can only come about through creating a watertight daycare business plan.
Business plans do vary slightly, but they should all cover the following areas:
There are five main business structures you can have in the U.S., and it’s important to choose the right one. We’ve shared your options below. They are:
If you don’t choose to form a legal business entity for your daycare business, you will be a sole proprietor by default. This won’t give you the legal protections you need, so we do not recommend this.
This is a type of business that is formed when two or more people work together without creating a more formal business entity. Like a sole proprietorship, it may not give you all the protections your daycare business may need.
The most common type of business entity. An LLC is fast, simple and inexpensive to set up and maintain. It protects your personal finances and assets and is a great way to start your daycare business.
This is a more complex type of business and isn't generally recommended for smaller organizations, like a daycare business.
These are the largest and most complex types of businesses and are typically far more than the average entrepreneur or daycare business owner will need.
Once you've legally created your daycare business, you’ll need to get some other things in place.
The location of your business will be critical. You want somewhere with a good amount of potential customers, but also with the right pricing so you don’t spend all your money on rent. You will need to make sure that the location is childproof to reduce the risk of injuries or incidents. Some people open daycares in their own homes, which allows you to save on rent.
In addition to the computer equipment you will need to manage your business, you will also need toys, games, art supplies and more to keep the children occupied and entertained. This could include both inside and outside activities, so plan for both.
Marketing will be a huge part of your daycare business. Naturally, you will need an awesome website, but you'll also need to get branding, newsletters, digital ads, social media accounts and other channels in place. Make sure that you clearly explain the unique approach you take with childcare to build reassurance and trust with parents.
The right software and processes will make running your daycare business much easier. See our list of the best apps and software at the end of this guide.
Many daycare business owners don’t employ anyone else to begin with. Once your business gets off the ground you can look into hiring other qualified childcare professionals.
You will need a separate business bank account for your construction business. You might also want to consider a business credit card. Additionally, you will also need to keep careful bookkeeping records and file business and personal taxes. Here at Incfile we can even help you file your taxes.
