How to Start an In-Home Daycare Business

how to start an in-home daycare business

Starting a home daycare business can be an extremely rewarding career move. If you love taking care of children and have the space to run a daycare from your home, there’s a good chance your business will be in high demand. Independent daycare jobs can pay well, especially if you know how to set up the business side of things correctly.

Whether you want to start a small in-home daycare, a scalable childcare business, or a Montessori daycare within your home, keep reading. Here’s how to start an in-home daycare business.

1. Create a Plan

In a perfect world, you’d be able to open your doors to the families in your community and start making a living doing what you love right away. But it takes time and lots of planning to effectively open up a home daycare center

To start, you’ll need to form a plan for every major aspect of your daycare business. Here’s what that entails. 

Daycare Name

You’ll need to establish a business name. Ideally, choose a name that stands out, is easy to remember, and describes a little bit of your unique childcare approach. 

Cost of Services

How much will you charge for daycare? If you have no idea where to start gauging your prices, take a look at some local childcare centers and compare pricing. Ask families and friends what they’d pay for at-home daycare. Read up on the industry. And, of course, factor in your business finance needs for operating a daycare.

Daycare Budget

There are legitimate business costs involved in starting a home daycare. Before you offer childcare to the public, you need to know your daycare budget. This includes operating costs, projected revenue, expenses, emergency funds, and more. How will you fund your home daycare? Are you prepared for the financial obligations? 

Work-Life Balance

Lastly, be honest about your ability to maintain a healthy balance between work and life. You need to prepare some clear boundaries and stick to them. Is there a designated area of your home for daycare? Will your own kids be present during work hours? How will you manage organizing, meal preparation, and cleaning for both work and home? There’s a lot to consider.

2. Know the Requirements 

As with any other childcare business, there are federal, state, and county at-home daycare requirements you must follow. Unless you’re simply nannying or babysitting, you legally cannot operate a daycare without a license.

There are important licensure requirements that childcare providers must obtain and renew. A license holds you (the owner) and employees accountable for the children in your care. It also prevents irresponsible action and protects you from legal trouble. Similarly, daycare insurance protects you from potential crime, liability issues, and property damage.

Another requirement to know about is capacity. How many children can you care for at one time? More importantly, what are the local and state laws regarding at-home childcare numbers? Look into resources from and select your state to learn about the legal requirements and limitations. It’s also wise to contact a legal expert directly. 

3. Prepare Your Home for Daycare

You’ll need to gather everything you need to set up your home as a daycare. This includes equipment, supplies, and learning materials. It also includes safety, family-friendly decor, and a welcoming atmosphere.

Make sure everyone in your home is in support of you running a daycare business from the home. The last thing you need is conflict from the people you share a living space and home workspace with. Use common sense. If there are roommates or family members who might not accommodate a safe space for children, consider other childcare business options

Additionally, make sure you childproof your home to protect the young children who will be in your care. It’s also suggested that you have enough space for a designated childcare area so children can focus on learning free of distractions.

4. Legitimize Your Daycare Business

There are a few things to cover when it comes to the business side of childcare:

  • Pricing
  • Marketing
  • Parent communication
  • Billing and invoicing

Once you know the cost of your services, you can decide on what type of business model you want to run. This includes the daycare schedule, billing methods, payment due dates, and childcare curriculum. It also includes your teaching philosophy, childcare niche, and customer turnover processes. 

Are you going to publicly market your daycare? If so, how? Most home daycare providers start gaining customers through word-of-mouth referrals or through families they know in the community. Later on, you can consider childcare marketing, local promotion, and SEO.

Another important aspect of the business is professional communication with your customers. Parent communication can make or break a successful daycare business, so set yourself up for the best outcome by getting clear on these expectations. Many childcare providers use a secure daycare management app that includes parent-teacher messaging. 

5. Don’t Overcomplicate Your Home Daycare Business

There are a lot of steps to starting a home daycare business. It can sometimes get overwhelming. But one thing you don’t want to do is overcomplicate the business so much that you fail to start. 

You absolutely need the right licensing, funding, equipment, and supplies to start offering childcare. However, you don’t need extra fancy details to officially open and run a successful daycare. Don’t worry about having an expensive childcare website, social media following, or perfect five-year goal in order. Start with the foundations. You can always grow and improve.

6. Stay Organized and Grow Your At-Home Daycare

Once you start a daycare business from home, you might be surprised at how fulfilling the entrepreneurial side of it is. With the right environment, a solid plan, and a wholehearted commitment to serving your customers, it’s likely that you’ll attract more business over time.

Whether you scale your daycare business or simply need help staying organized, a childcare management platform is an ideal solution. It helps you manage the important things:

  • Daily activities
  • Parent communication
  • Parent billing
  • Health and safety logs
  • Learning assessments
  • Sign-in and attendance

Daily Connect, the most comprehensive childcare software on the market, helps new daycare providers set themselves up for success. Recognized by Capterra as the Best Value Childcare Software 2022, it’s the most affordable and accessible solution on the market today.

Start your free trial of Daily Connect in-home daycare software today to see how it can help you organize and scale your business.

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