Starting a Child Care Center

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It can be easy to feel lost or overwhelmed when starting a child care center. You have a dream but your are not sure how to realize it. Here is just a partial list of things you need to consider and some resources and information to get you on your way.

How do make start a child care program that meets all legal requirements?

  • The very first step is to check the State Licensing Requirements & Regulations site. Local licensing regulations will outline many requirements of your business from what equipment you will need to how many staff members you should hire.
  • Check to be sure that you have appropriate zoning approval.
  • Make sure you are compliance with local codes and ordinances. These may include an occupancy permit, along with fire healthy and safety inspections.
  • Be sure you have appropriate liability insurance
  • Other steps may include establishing a fictitious name, getting a federal identification number and determine what type of business entity you are; sole proprietor, partnership, or corporate institution.

What will it cost?

Here is just a partial list of expenses you are likely to incur for a starting a child care program.

  • Equipment
  • Furnishings
  • Supplies
  • Licenses & Permits
  • Health Insurance
  • Employee absences; sick leave, vacation, professional days
  • Taxes
  • Accountant and/or legal fees
  • Advertising
  • Rent
  • Garbage removal
  • Utility bills
  • Maintenance & Repairs
  • Insurance
  • Food
  • Phone
  • Fire alarm system

How will I build enrollment?

  • Before you go to far in planning a center, you need to make sure that your business will be successful. Is there a need for you program?
  • It is wise to do your homework here. Do some market research and learn what type of service or program is most needed in your community. State Profiles give a summary of key information about child care in your state
  • Choose you location carefully. Consider neighboring businesses, parking, et., Your local chamber of commerce may be helpful here.
  • Find some useful marketing and promotion ideas.

How should I determine tuition?

  • Of course this will vary. It will depend on the size of your program, the age ranges you care for and other services you provide. As a rule, infant care is the most expensive. This is not known as a business to get rich in. Many programs report not seeing a profit for the first 6 months to a year. Even then average profit margins are only 10-15%.
  • In establishing your rates, it is best to learn what the going rates are for similar programs in your town.

What policies and procedures should I establish?

  • You will want to have a written contract of services with the families. Find some pointers on drafting a contract.
  • Establish a mission statement or philosophy, it helps guide future decision making on curriculum, hiring of staff and other polices.
  • Most of your health and safety policies will be governed by the state licensing regulations.
  • You will need to set up a system for bookkeeping and recording keeping.

Who else will need to be involved?

  • It is often recommend that you hire an attorney, and an accountant. Most people that start a daycare center know child-care and psychology; not tax laws or liability issues.
  • Ultimately, the heart of your program will be the staff. Those who are with the children day in and day out. Qualifications and training requirements are usually outlined by state regulations. It is worthwhile to hire the highest quality staff you can.

How can I find funds?