How to Start a Childcare Business

Every city, town, and village needs childcare centers. They’re crucial parts of local communities, enabling parents to work and creating healthy, happy experiences for kids to learn and bond with others. If you’re thinking about how to start a childcare business, there are several things you should be aware of.

In this article, we’ll cover everything you need to know to start a childcare business that lasts.

Choose a Location

The first thing you need to decide when considering how to start a childcare business is whether it’s going to be an at-home center or a daycare facility.

Many small but mighty childcare businesses are run by one professional in their home. It’s a flexible option where even your own young children can be present with you while you run the childcare business. However, the cost of this startup can be difficult without ample preparation or support. You need the right amount of space dedicated to the daily activities of your business, meaning a smaller living situation isn’t ideal. 

Running a childcare center at a facility can be easier if you have enough money to rent or buy a dedicated space. Renting out a childcare space is convenient, as you get the entire space to run your business. But if you’re committed to operating a facility, there are often more regulations you need to follow.

Learn the Regulations and Get Licensed 

One of the most crucial parts of starting a childcare business is obtaining the right licenses and abiding by regulations. It’s wise to get yourself covered early so you don’t run into any conflict with the law and so you can start operating your business smoothly.

Look into everything you need at a federal and state level. Some cities and counties have different regulations you’ll need to be aware of, too. Do your research and contact local education boards to find out exactly what you need to get legitimately licensed.

Establish Your Finances 

Get clear on the financial requirements of your new childcare business before getting too far into launching into the business. Create a forecast that makes clear how many children you’ll need to enroll, and at what prices. This means knowing your budget, the cost of any overheads you’ll have, and any fees due for licensing. It should also include clear financial goals so you can work your way up toward success in your business.

Learn how to create a childcare center business plan which will help you have a clear direction in your business, especially for the first several years. If you need assistance with the finances during startup, look into government grants and tax credits available to you.  

Set Up Bookkeeping and Accounting

Along with getting clear on the financial details of your business, you need to plan what type of bookkeeping you’ll use. This includes the details of:

  • Enrollment and tuition costs
  • Financial tracking
  • Parent billing
  • Childcare software 
  • Tax details
  • Organizing write-offs and school supplies

If you set good accounting practices in place before your business gets up and running, it will make it much easier for you long-term. Don’t try to do it alone — consider investing in a digital platform geared specifically for childcare providers. This will save you a lot of time, money, and energy for years to come.

Create the Curriculum

What’s a childcare center without a curriculum? Come up with the learning plan for your daycare center. Tie in your childcare center’s core philosophy and modes of operation in your schedules and methods. 

Consult the Early Childhood Education (ECE) standards in your state and implement a balance of play, hands-on learning, and structured lessons daily. Make it unique— your childcare center stands out somehow, so include it in your teaching model.

Hire Staff to Join Your Team

If you’re planning to run a childcare business with the help of others, you’ll need to think about your hiring process. Here are some key questions to consider when getting ready to hire employees for your team:

  • What qualifications are you looking for?
  • What are the childcare center’s values, principles, and philosophies?
  • What level of experience do you expect each staff member to have before hire?
  • What curriculum will you direct the teachers and staff to implement?
  • What will you include in the employee handbook?
  • How will staff communicate with each other on-site during work hours?
  • What will be the clear expectations for each level of staff?
  • How will the onboarding process work?

Every childcare center is different, so choosing employees that reflect the standards of your business is essential.

Marketing and Promotion

You’ll need a strategic marketing plan to ensure that families can easily find you and enroll their kids in your new daycare center. It’s helpful to have an online presence, whether with a custom website, social media accounts, or online listings on sites like Angie’s List or

Know which demographic you serve in the area your childcare center will be in. Target your marketing plan toward the niche you serve and you’ll have better luck converting leads into sign-ups. Leverage local outreach opportunities, such as public bulletins, family planning centers, neighborhood parks, and local babysitting services.

Write Your Policies and Contracts

When it’s time to finally set your business in stone, finalizing it beyond licensure is a milestone worth celebrating. Create your school’s policies, guidelines, and contacts for:

  • Parent and teacher agreements 
  • Health and safety standards
  • Food and allergy protocols
  • Staff files
  • Legal documentation
  • Emergency plans
  • Field trip liabilities
  • And more

If you need help, hiring a lawyer might be a good idea so you can make sure all your bases are covered and nothing is left out. 

Invest in a Childcare Software

When you’re finally welcoming kids to your new childcare center, run your business smoothly by using a childcare management software. These digital tools help you organize your business in every way possible. 

From payment processing to ongoing parental communication, childcare software apps like Daily Connect provide you with the streamlined processes you need to run your business. 

Features of childcare software include: 

  • Shared event calendars
  • Parent-teacher communication 
  • Center-wide communication tools
  • Health and COVID-19 protocols 
  • Staff communication and attendance tracking
  • Contactless sign-in and sign-out
  • Billing and payment management
  • Documentation and authorization file management
  • Learning and assessment tools
  • And more

If you’re starting a childcare center, the process can seem overwhelming. Having all the tools you need in one versatile platform gives you quick and easy access to the most important information you can always refer back to. 

Whether you’re just beginning to think about how to start a childcare business or you’re learning how to improve your new daycare business for long-term success, contact Daily Connect today to see how our platform can guide your everyday operation. 

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