business plan for a daycare center

How to Write a Business Plan for Daycare and Preschool

brightwheel
Running a business

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Writing a daycare or preschool business plan is a big task, but due diligence and hard work will help you understand what you’ll need to launch and run a daycare or preschool successfully.

people sitting around a table reviewing a business graph

What do daycare investors want?

Your local government will have rules and regulations you’ll need to follow as a small business owner and childcare provider. Start by reviewing the childcare licensing guidelines for your state and city. Once you’re clear on licensing guidelines, you’re ready to start writing your childcare business plan.

The purpose of a business plan is to help secure funding. You’ll likely need financing to launch your preschool or daycare, especially if you want to avoid the monthly repayment of a loan.

Investors provide businesses with money in exchange for partial ownership. As a result, they expect a larger return on their initial investment. Because many investors work in business, they prefer to invest in an established company.

Most investors look for:

Industry background and experience

Financial performance and promise.

Investors want to make money. Therefore, they are more inclined to work with experienced entrepreneurs and business owners to guarantee a return on their investment.

This might sound discouraging for those with little experience or without a business management background, but the opportunity doesn’t end there. You could consider bringing on a partner with a business background. Additionally, many investors act as a source of business advice.

You need to demonstrate that your business will make money. Investors will likely want to see signs of business growth before they give you money.

Additionally, investors will want to know about your financial stability. Questions an investor might ask are:

What do you plan to do with the money?
Has your business been up or down in recent years?
Is your company losing money? Are there signs of growth for the future?
How do you plan to repay your investment?

Of course, every investor is different, so they’ll consider various factors. While experience and financial promise are at the top of the list for most investors, they might also look for uniqueness, business readiness, an effective business model, and more.

A women using a calculating and holding cash

Writing a daycare business plan

We’ve discussed licensing and investors. Now, you’re ready to begin the framework of your business plan for daycares and preschools. Here’s what you’ll need to get started:

Business description

Needs assessment, insurance policies, operating policies and procedures, marketing strategy.

Start with the basics: what does your daycare do? Detailing the service you’re offering will help you create a clear business plan. Next, you might want to write some goals or even a mission statement outlining your purpose and motivation.

Start by looking at general daycare or preschool industry trends, then narrow your scope to the preschools or daycares in your local area. Next, you’ll need to figure out who your target customers are and confirm that there is a need for a business like yours in your community.

Are there a lot of young families in your neighborhood? Are you located somewhere convenient for commuting parents? Does your business offer a specific service that your competitors don’t, like early check-in or extended hours?

Also, check out the competition. Research the existing daycare or preschool options in your community. Look at current preschool or daycare business plan samples. What makes your daycare or preschool unique?

Developing detailed budgets will help you run your small business. You’ll need to compare your current cash flow and expenditures to determine whether you’ll make a profit.

Build a budget for unexpected costs. For example, how many children do you need to serve to be able to pay your bills and stay afloat? Child Care Aware of America offers some terrific budgeting resources for this process.

Depending on the type and size of your preschool, you’ll need insurance policies of several different types, including liability, property, workers’ compensation, and business insurance. Check the licensing requirements for guidance in building this part of your preschool business plan.

Create a comprehensive handbook for families and staff that includes you center's policies and procedures. For instance, you'll need to develop an emergency plan , daycare sick policy , and other safety protocols according to your local childcare licensing requirements.

Your staff handbook will be a helpful resource your employees can reference and include all your employment policies including work and pay schedules, benefits, and information about professional growth and development. You can also include information on your center's philosophy and curriculum, classroom procedures, and expectations for working with children and families.

Your marketing strategy is the key to attracting customers. Decide what type of advertising you will use in front of potential customers. For example, list your school in local directories and participate in parenting and kid-friendly community events. Run a social media campaign focusing on your target population.

Another big part of childcare business marketing is differentiating yourself from other preschools. These days adopting daycare software is a surefire way to attract families with young children. A tool like brightwheel's center management feature will streamline your center's admission process, record keeping, and reporting, saving you up to 20 hours per month.

You can also use brightwheel for recording and tracking daily events and activities, and sending real-time updates to families throughout the day. It also offers secure, digital check-in/check-out and a paperless billing system. This is a great way to keep your families looped in on daily activities and handle all of your administrative tasks in one place.

Your business is ready!

Writing a business plan can be stressful, but it doesn’t have to be. Once you secure the proper licensing, use the information in this article to guide you through creating a solid daycare business plan that drives investors and financing to your business.

These are just the basics to get you started. For further information, the U.S. Small Business Administration’s website has detailed instructions on creating each necessary part of a successful business plan.

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A list of everything you need to start an early education program.

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The Daycare Business Plan Blueprint (Examples + Template)

April 14, 2022

Adam Hoeksema

Starting a daycare business can be a daunting task. There are so many things to think about and plan for. You need to find the perfect location, get the right licenses and permits, hire qualified staff, and, most importantly, create a daycare business plan.

Creating a daycare business plan is one of the most important steps in starting your business. A well-thought-out business plan will help you get funding, attract investors, and operate your business effectively.

The bad news is that there is a lot of advice out there on writing a business plan. With so much information and tons of daycare business plan examples to choose from, it can be overwhelming to know where to start.

The good news is, we've got you covered. In this article, we'll give you a comprehensive guide on how to write a daycare business plan. We will also provide some examples and a free daycare business plan template to get you started.

But First...Is a Daycare a Good Business to Start?

Before we talk about how to create a daycare business plan, let's first answer the question: is starting a daycare a good business to get into?

The answer is a resounding yes! The daycare industry is growing rapidly. It is one of the few businesses that are not only recession-proof but also thrives in uncertain economic times.

According to the National Association of Child Care Resource & Referral Agencies (NACCRRA), the demand for child care services has increased by 26% over the last decade. This demand is only expected to grow in the coming years.

When it comes to profitability, the daycare industry is very attractive. According to IBISWorld , the average profit margin for a daycare business is around 15%. That's higher than the average for most other industries!

If you're thinking about starting a daycare business, know that you are getting into a very profitable and in-demand industry. Now let's talk about how to write a daycare business plan that will help you start and grow your business successfully.

How to Create a Daycare Business Plan

A daycare business plan is as simple as a word document with the following sections:

Business Description
Market Analysis

Business Model

Location and Facility
Marketing Plan
Financial Plan

Executive Summary

This article will provide context of what to include in each section of your daycare business plan. As you work on writing your business plan, you will want to grab our daycare financial projection template as well in order to complete the financial plan section.

Your daycare business plan should be an elevator pitch in itself. It should be attractive to potential partners and investors. Basically, it should give them a clear idea of your business, where it is located, what services you offer, who your target market is, and how you plan to make money.

Creating a daycare business plan doesn't have to be complicated. In fact, the cheapest and easiest approach is to simply start with a blank word document and work through each of the above sections, it can be pretty easy. Here is a step-by-step guide on how to create a daycare business plan:

Create a Compelling Business Description

Your daycare business's unique selling point (USP) should be the first thing you include in your business plan. What is it that makes your daycare center different from all the others?

This description should be the foundation of your marketing efforts as well.

There are a few questions you should answer in your company description. They include:

What's your Curriculum Based On?

Potential investors, partners, and even customers will be interested in knowing what your curriculum is based on. This will help them understand the environment children will be in a while under your care.

When describing your curriculum, make sure to include:

What age ranges do you cater for?
The type of care you offer (full-time, part-time, drop-in)
Your educational philosophy
The activities and programs you offer

For example, if your daycare is unique by offering a Montessori curriculum, you will want to highlight that. In fact, you can learn more about how to start a Montessori program here .

How Big is Your Facility?

The size of your facility will say a lot about the type of operation you're running. Are you a small, home-based daycare or a large center with multiple classrooms?

This section of your business plan may include:

A floor plan of your facility
The capacity of your facility
The number of employees you have
Type of equipment and furniture you have

Who Is Your Target Market?

You can't market to everyone, so you must identify your target market. This will help you focus your marketing efforts and ensure that you're reaching the right people.

Below is a daycare business plan example that shows how your business description should be:

“ABC Daycare is a small, home-based daycare located in San Francisco, CA. We cater to children aged 0-12 years old and offer full-time, part-time, and drop-in care.

Our curriculum is based on the Reggio Emilia approach, emphasizing hands-on learning and collaboration. Activities and programs include arts and crafts, music, and outdoor play.

Our facility can accommodate up to 12 children at a time. We have a staff of four employees who are all CPR and First Aid certified.

Our target market is working parents in the city who need quality child care but can't afford the rates of larger daycare centers. We've created an affordable subscription-based pricing model for our target market to fulfill the demand. We generate revenue through monthly subscriptions and have low operating costs due to our small size.

Our suppliers are local businesses that provide us with food, toys, and other supplies.”

Do a Thorough Market Analysis

After writing a compelling description of your business, you need to do a thorough marketing analysis. This analysis will help you determine your target market, what type of advertising and promotion will work best, and how to price your services.

You should also research the competition and see what they are doing right and wrong. This information will be invaluable as you create your daycare business plan.

Keep these things in mind when doing a market analysis:

The Size of Your Market

This is determined by the number of potential customers in your area who need or want your services.

For example, if you live in a small town with only a few thousand people, there may not be enough demand to support a large daycare facility.

On the other hand, if you live in a city with hundreds of thousands of people, there may be room for multiple daycare facilities.

Your target market is the segment of the population that is most likely to use your services. This includes factors like age, income, education, and location.

After you've identified your target market, you need to show how you plan on fulfilling the demand. This is where your business model comes in.

Your business model is a detailed description of how your daycare will operate daily. It should include:

How do you plan on acquiring customers?
What are your pricing strategies?
How will you generate revenue?
What are your operating costs?
Who are your suppliers?

Your business model should be detailed and easy to understand. It should also be realistic and achievable.

Here is a daycare business plan example of a business model for a small daycare center:

“The daycare will be open Monday through Friday from six in the morning to six at night. We will offer care for children ages six weeks to twelve years old.

Our rates will be $50 per week for one child and $40 per week for each additional child from the same family. We will offer a discount of $20 per week for families who enroll their children for an entire year.

We will generate revenue by charging weekly rates for our services. Our operating costs will include rent, utilities, supplies, and salaries for our employees. Also, we will acquire customers through online advertising and word-of-mouth.”

As you can see, a business model is a detailed description of how your business will operate. It's essential to have one in place before promoting and selling your services.

One thing you should not forget to include in your daycare business plan is the location of your business and your rental agreement. If you are renting a space, including the terms of your agreement and how long you have the space. If you are purchasing a property, include information on the property, such as square footage and any special features that will help your business stand out.

This daycare business plan example shows you how to include this vital information:

“The daycare will be located at 123 Main Street in a commercial space currently leased by the owner. The lease agreement is for three years with an option to renew for an additional three years. The monthly rent is $2000, and the security deposit is $3000.

The daycare will have exclusive use of the main floor, including a large open play area, a small kitchen, two bathrooms, and four classrooms. The daycare will also have access to the outdoor playground.

80% of our space will be used for childcare, with the other 20% used for our administrative offices and staff lounge.

We have chosen this location because it is close to several residential neighborhoods and has easy access to public transportation. The space is also large enough to accommodate our future growth.”

There are many daycare business plan templates you can use to help you get started. This is a basic outline of what should be included.

Daycare Marketing Plan

Most daycare business plan templates will include a section for your marketing plan. Most people overlook the marketing aspect of their business, but it is one of the most important pieces of your puzzle.

In your business plan, you need to outline your target market, your marketing strategies, and how you plan on executing those strategies.

You also need to set aside a budget for your marketing efforts. Many people make the mistake of thinking that they don't need to spend money on marketing, but that couldn't be further from the truth.

The following daycare business plan example shows you how you should describe your marketing efforts:

"Our target market is working for families with children between six weeks and five years old. We will reach our target market through online and offline marketing efforts.

Some of the offline marketing strategies we will use include print advertising, flyers, and word-of-mouth referrals. We will use a mix of SEO, content marketing, and social media for online marketing.

We have set aside a budget of $500 per month for our marketing efforts."

As you can see from the example above, your marketing plan should be clear, concise, and to the point. Don't forget to include a budget!

Daycare Financial Plan

Your business plan should include a financial plan section. This is where you'll lay out how much money you need to start or grow your business. Be specific and include dollar amounts. If you're seeking a loan, including information on how much you're requesting and how you'll use the funds.

You should also include a detailed budget in your business plan. Your budget should include all of your projected income and expenses for at least the first year of operation. Creating a budget will help you get a clear picture of what it will cost to start and operate your business.

This section should include projected costs for:

Rent or mortgage payments
Advertising and marketing
Operating expenses such as utilities, supplies, and more.

Startup costs are another vital item to include in your business plan. This is the money you need to purchase equipment, furniture, or any other items to get your business up and running.

If you plan to secure a loan, your lender will want to see a detailed business plan with information on how you plan to use the loan funds. Ensure you include this information in your business plan to increase your chances of securing funding.

If you're seeking funding from investors, you'll need to include information on how they will be compensated. This is typically done through equity, a percentage ownership stake in your business.

For example, if you seek $100,000 in funding and offer a 20% equity stake, the investor will own 20% of your business.

Make sure you use a daycare business plan template that includes a section on funding to ensure you include all the necessary information. If you’re planning to get a loan or seek investment, you’re going to need full financial projections. Our daycare financial model will provide up to 5 years of projected income statements, cash flow and balance sheet forecasts.

Next I want to answer some key financial questions for you as you consider how to forecast your daycare financials. I am going to hit on:

Daycare Startup Costs
Daycare Revenue
Daycare Facility Operating Expenses
Daycare Profitability

Let’s dive into some key questions.

How much does it cost to start a daycare?

It costs between $10,000 and $50,000 to start an in-home daycare business according to Bizfluent .

It costs between $59,000 and $3 million dollars to start a daycare facility according to Bizfluent .

So obviously this is a huge range in startup costs. The main thing that will determine your startup costs is your daycare facility. Depending on how large your daycare is, whether you are buying, building, or leasing the space, and how much renovation needs to be done, your startup costs can vary drastically.

Some tips to help you estimate a cost of a daycare facility:

A daycare facility should have 35 square feet of open floor space indoors per child.
So if you wanted a facility that could care for 100 children you would need 3,500 square feet of indoor space for children, plus additional space for offices, kitchen, bathrooms, etc. Let’s assume that you would need at least 5,000 square feet of space for a daycare facility that served 100 children.
A daycare center would cost at least $295 per square foot to construct in the U.S. based on data from Levelset .
Constructing a new 5,000 square foot daycare center would likely cost at least $1,475,000 based on $295 per square foot.
Now you might not be constructing new, rather you might rent an existing facility which could require renovations. You will need to get a specific quote for the specific renovations that you need for your space.

How much revenue can a daycare business make?

A daycare facility can generate $17,680 in revenue per year per child according to Zippia .

A daycare business with 100 children can generate over $1.75 million per year in annual revenue based on our average revenue per child of $17,680.

How much does daycare cost?

The average cost of daycare is $17,680 per year, per child in the U.S. according to Zippia .

This means that the average monthly cost of daycare in the U.S. is roughly $1,475.

What is the typical child to staff ratio for a daycare?

The typical child to staff ratios for a daycare are:

1 adult staff for every 4 infants (age 0 to 12 months)
1 adult staff for every 6 toddlers (age 1 to 3 years)
1 adult staff for every 10 pre schoolers (age 3 to 5 years)
1 adult staff for every 12 school aged children (5+ years old)

Source - Childcare.gov

These ratios will help you estimate how many staff members you will need. Our financial projection template makes this easy. Just enter in your ratios and the number of children you expect to have in each age group and the model will automatically calculate the number of staff required to maintain your ratios. See the input daycare staffing table below:

What are the typical operating costs for a daycare?

Your largest operating expense for a daycare facility is likely to be your rent.

It should cost between $20 and $30 per square foot to rent a daycare center space based on available spaces on Loopnet .

Other operating costs for a daycare center include:

You can see how you can enter in your operating costs into our financial model below:

How much profit can a daycare make?

The average daycare profit margin is 6.5% according to Daycare Business Boss .

Once you complete your projections you will want to take a look at our At a Glance tab to make sure that your projected profit margins aren’t way out of line with the industry norms. You can find projected profit margins for your daycare below:

This is an important aspect that you may not find in most daycare business plan templates, but it's still essential. An appendix includes any additional information to help you understand your business plan. This might include things like your:

Business licenses
Insurance policy
Lease agreement
Sample contracts
Staff bios

This section adds credibility to your daycare business plan and shows that you've done your homework. Including all of the necessary details in your appendix will give investors peace of mind and show that you're serious about starting a daycare center.

An executive summary is a brief overview of your business plan and is often considered the most important section. It should be two pages long, with a clear description of your business, your goals, and why you will achieve them.

There are several key elements to include in your executive summary:

Business Name: This is the name you have chosen for your business.
Location: Include the city, state, and country where your business will be located.
Business description: Describe what type of business you will be operating.
Target market : This is the group of people you will be targeting as customers.
Competition: Who are your competitors, and how will you compete with them?
Product or service : What product or service will you be offering?
Sales and marketing: How will you generate sales?
Financials: Include a five-year income statement, balance sheet, and cash flow statement.
Management team: Introduce your management team and their experience.
Exit strategy : This is the plan for how you will eventually sell or otherwise exit the business in case you decide to retire or move on to other projects.

The executive summary is the most crucial section of your business plan because it gives investors and lenders a quick overview of your company and its prospects. Be sure to include all of the key elements listed above, and keep it under two pages in length.

What Are The Benefits of Creating a Daycare Business Plan?

Research shows that a business plan helps business owners make better decisions, turn abstract goals into tangible objectives, and track progress over time. But what does this mean for those who want to open a daycare?

Creating a business plan forces you to think through every step of starting your company. It's a valuable exercise that can save you time and money in the long run. Even if you don't end up following your business plan to a tee, the process of writing it will help you better understand your business and what needs to be done to make it successful.

There are many benefits to creating a daycare business plan, including:

Gives You a Roadmap to Follow

As with any journey, it's always helpful to have a map. A business plan is that map for your daycare business. It will give you a clear idea of where you want to go and how you can get there.

Helps You Secure Funding

A business plan is essential if you're looking for investors or loans. It will show potential lenders and investors that you've put thought into your business and have a solid strategy for making it successful.

Ensures Your Daycare Business is Feasible

When you're starting a business, it's easy to get caught up in the excitement and overlook potential problems. A business plan forces you to take a step back and assess whether your business is truly viable. It also helps you identify any areas where additional research is needed.

Final Thoughts

A daycare business plan is a valuable tool to help you make your business successful.

It is worth noting that your business plan is not a one-time exercise but should be updated regularly as your business grows and changes. This document is meant to be a living document that evolves as your business does.

If you're unsure where to start, there are plenty of resources available to help you, including daycare business plan examples online, books, and daycare business plan templates.

You can also use our daycare projection template to get your financial plan ironed out and ready for your business plan.

The most important thing is just to get started. The sooner you create your business plan, the better prepared you will be for success.

You can get the Daycare Facility financial projection template here!

The template is simple to use and will save you loads of time while still producing professional looking daycare projections. ProjectionHub has helped more than 50,000 businesses create financial projections so you can be confident that you can do it too.

The daycare business projection template includes:

5 Year Daycare Facility Pro Forma Financial Statements

CPA Developed & Completely Customizable

Free Support & Projections Review

Compatible with Google Sheets

Free expert review of your completed projections

The template is easy to use and you do not need to be an excel wizard to fill it out. Editable cells are highlighted in blue, a video guide is included, and our team is available to answer any questions you have.

You can see the complete walkthrough and demonstration of the daycare business forecast template here:

Get the template today for just $79

If you have any questions before purchasing, please feel free to begin a live chat or email us at [email protected]

100% money back guarantee in accordance with our terms and conditions

‍ Photo by Pixabay

About the Author

Adam is the Co-founder of ProjectionHub which helps entrepreneurs create financial projections for potential investors, lenders and internal business planning. Since 2012, over 40,000 entrepreneurs from around the world have used ProjectionHub to help create financial projections.

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If you’re a teacher, former teacher, or simply have years of experience caring for children — and an entrepreneurial streak — you might have considered starting your own day care center, either from home or in a dedicated facility. And at an expected job growth of 7% over the next decade, working in child care is a stable career choice. So, if you’re seriously wondering how to start a day care center, you’ve come to the right place.

As is the case starting a business in any industry, however, your passion for your craft alone — or, in this case, your students — isn’t quite enough to ensure that your day care business is copacetic, either financially or legally. You’ll need to do a good amount of due diligence when looking into how to start a day care business, paying special attention to licensing requirements, and ensuring that your facility and program aligns with your state’s health and safety codes.

If you’re a pro at educating, training, supporting and generally corralling large groups of small children, you should be pretty unperturbed by the work it takes to start a day care business. Here’s what you need to know.

How to start a day care business

Although every path toward starting a business looks different for every business owner, there are a few steps that every aspiring day care owner needs to think about when it comes to how to best start a day care.

1. Decide what kind of day care business you want to start

Before you can even get to writing a business plan for your day care business, you need to decide what kind you want to open. Look into whether you want to start a day care business at home, or whether you want a more commercial facility — there might be different permits required in your municipality depending on which you choose. You also need to decide what age groups you want to focus on.

Next up, you'll have to decide on a business entity, which will have huge effects on the way you're taxed and how you operate your day care business. Will you have partners or open your business on your own? Additionally, you'll want to consider whether you want a business entity that offers you some protection. Making your day care center a limited liability company might be a good move, since the business will take on liability should anything go wrong.

You might also decide to buy into a day care franchise opportunity. This option will significantly streamline the steps you need to take in opening your day care.

Once you narrow down these details about your business, you can move on to the next step in starting a day care business: writing a business plan.

How much do you need?

with Fundera by NerdWallet

We’ll start with a brief questionnaire to better understand the unique needs of your business.

Once we uncover your personalized matches, our team will consult you on the process moving forward.

2. Write a day care business plan

This is a step you have to take when starting any business and it can be quite a bit of work, especially for anyone looking to get moving quickly on their business. When you start writing a business plan, start with an outline of all the things you want to include.

Your plan should include a summary, an overview of the company, a market analysis that includes an assessment of the need for a business like yours, a marketing and sales plan, and a financial plan along with financial projections. Don't worry, though, you can always add to it as your business grows.

One thing you should include, though, is market research. The last thing you want to do is go through all of these "how to start a day care business" steps, only to find that there isn't a market for one or that there are already too many day cares in that area to make it a viable business.

Your business plan should also include a budget. The costs associated with opening and running your day care center can never be accurately totaled, but nailing down a budget will give you some parameters to work within (and some peace of mind).

In your budget plan, don’t forget to factor in:

Your startup costs, including day care equipment, food, toys and educational tools, wages, insurance and licensing.

How much tuition you’ll charge.

Your predicted revenue over the next two to three years.

When you’ll break even.

Also know that day care centers can claim certain tax deductions, which can ease your annual financial burden.

You'll also want to include a marketing plan. If you’re seriously researching how to start a day care business, it’s likely that you’ve already been caring for children in your area for some time and have built up a network of local parents. That’s one valuable method of attracting customers (aka word of mouth) covered. Still, implementing even a basic marketing plan can help define and legitimize your business — and if you need to implement a waitlist as a result, that’s great too!

Your marketing efforts can be relatively simple and low-cost. You can start by creating a Facebook page for your day care center and building a business website, making sure to include your contact information and a little bit about your business. If possible, plan to include pictures of your facilities and testimonials from happy customers.

If you’re a fan of social media, it also can’t hurt to create an Instagram, LinkedIn and/or Twitter account to keep both current and prospective customers updated on your business. Just be sure that once you do, you receive permission from parents or guardians before posting pictures of their children, of course.

Analog marketing techniques would work well here, too. If possible, consider distributing flyers or brochures to nearby libraries, schools, places of worship or any other local gathering spots.

3. Obtain the necessary certification and licenses

You may not need a master’s degree in education to become a day care teacher, but each state does require some combination of licensing and certification when it comes to how to start a day care. Visit your state’s Division of Child Care Services (or its equivalent) to find out the training, experience and credentials you need to legally operate a day care facility.

In New York State, for instance, the head of the day care facility must have one of the following:

An associate degree in early childhood education or an equivalent.

A CDA credential (child development associate) and at least two years of experience caring for children.

A high school diploma and at least three years’ experience caring for children.

You'll probably find that there are some other requirements that usually come up when you're looking up how to start a day care business at home or in another facility. Your state may require that you and any staff you hire are CPR-certified, for one. Another point of safety to remember is that you should be trained in at least basic first aid for children. You and your staff might also need to be fingerprinted and undergo background checks before being cleared for work.

Even if your state doesn’t require that you obtain a license, you should consider doing so, as your licensing course will go over all the boxes you need to check to operate your day care in your state — including health and safety regulations, proper food preparation and the required child-to-adult ratio.

4. Find a (safe) day care facility

In certain states, in order to obtain the proper licenses or registration to start your day care business, you’ll first need to show that your day care facility meets your state’s health and safety requirements.

So whether you choose to open your day care facility in your own home, or buy or lease a new property, you’ll need to make sure your facility meets zoning, fire, and health and safety laws. When it comes to how to start a day care at home, you may need to make alterations to your house to comply with day care requirements in your state, so be sure to factor them into your budget.

5. Get insured

Another requirement for obtaining your license? Getting insured. In certain states, you’ll need to be licensed by the Department of Health and Human Services to run your day care center, but to do so, you’ll first need liability insurance.

The exception is home-based day care centers, which don’t need insurance to be licensed by the DHHS. Still, those opening day care centers at home should seriously consider obtaining small business insurance. You always run the risk of a lawsuit when you’re running your own business, but that risk increases when caring for other people’s children — so protect yourself whenever possible.

There are several types of insurance that cover day care businesses — general liability insurance, workers’ compensation, property insurance, abuse and molestation insurance and others — so contact an insurance broker to help you decide which coverage is best for your business.

6. Get a business checking account and credit card

Get a business credit card and a business checking account early on to help you keep your business expenses separate from your personal expenses when first starting a day care.

It’s crucial to separate your personal and business expenses for many reasons, not the least of which is to reduce your (or your accountant’s) burden come tax season. It’s simply the most professional way to conduct your business, too. Set yourself up for success now by signing up for a business credit card and opening a business bank account, and be diligent about using both solely for your day care’s finances.

Having a business credit card can help you increase your business credit score, too. By paying the card off on time — or early if you can — you can boost your score, which will help you late on when you need a loan or other financing for your day care business.

7. Get financing

Most entrepreneurs bootstrap their businesses at the beginning, as it’s difficult for brand-new businesses with limited credit history to secure a business loan, either from a bank or from an alternative lender.

Your financing options aren’t limited to your own purse strings (or your friends’ and family’s). Here are a few other ways to get funding and loans for a child care business:

SBA microloan

Although most SBA loans are available only to businesses with a few years of experience under their belts, SBA microloans are actually designed to help startups get off the ground. They’re especially accessible to women, veterans, minorities and business owners in low-income areas. And unlike most other SBA loan programs, SBA microloans are disbursed by nonprofit lenders, rather than banks.

As the name suggests, SBA microloans tend to be on the smaller side, with amounts capped at $50,000, but they may be as low as $500. (For more context, the average microloan amount was $14,000 in 2017.) And because microloans are designed for new businesses, business owners with average or even challenged credit may still be accepted, as long as other aspects of their SBA loan applications are in good shape.

SBA community advantage

These loans from the SBA have all of the advantages that come with SBA microloans but the community advantage loans are specifically for businesses that are serving traditionally underserved communities. These loans are generally for a higher dollar amount than the microloans and can go a bit further for your business.

Government grants

You might be able to obtain financial assistance to start and run your day care through state or federal funding programs for early childhood education providers. For instance, you can contact your state’s Child Care and Development Fund Plan to look into startup funds, or your state’s school meal contacts to seek funding for your day care center’s meals.

Take a look at the Administration for Children and Families Office of Child Care’s list for a more comprehensive overview of federal and state financing programs for child care centers .

Business credit card

It’s important to use a business credit card to keep your day care’s expenses separate from your own. Of course, using a credit card is also the most convenient way to pay for your daily expenses. And since credit limits for business credit cards tend to exceed those of consumer cards, you can spend more liberally without worrying about maxing out your card.

Another bonus? Using your business card responsibly (by which we mostly mean paying off your balance in full and on time, every month) can help you build business credit. And with a healthy business credit score, you’re in a better position to secure business loans with great terms down the line.

If you opt for a card with a long 0% intro APR period, you can essentially use that introductory grace period as an interest-free loan. Look into the American Express Blue Business Plus card, which, at 12 months, carries one of the longest interest-free introductory periods in a business credit card right now.

After your 12 interest-free months are up, though, a variable APR kicks in at a rate depending on your creditworthiness and the market. Check the issuer's terms and conditions for the latest APR information.

8. Hire staff

You may be planning on running your day care facility solo, but depending on your state and the number of children you’re looking after, that might not be an option — every state sets a required ratio of staff to children to ensure that every child receives adequate care. They also dictate the maximum number of children permitted in a group.

Adult-to-child ratios and class sizes depend on the age of the children, but they might also depend on the size of the day care facility, or face further restrictions based on municipality. For a day care center in New York state, for example, the state requires one adult for six children under school age. However, in New York City, there must be two teachers or one teacher and one assistant to every six children aged 2 to 3, with a maximum of 12 students allowed in a single group. Your own children may or may not be included in that count, too.

So, while hiring really depends upon your state’s requirements, it makes sense to leave room for hiring staff in your business budget. That way, you’ll be prepared for growth, without worrying about your operation shutting down because you’re not properly prepared for it. (Just keep in mind that any staff you hire needs to be appropriately licensed or trained for it, and potentially undergo a background check.)

Start Your Dream Business

9. Write your day care contract and policies

To further legally protect your business, it’s crucial that you draw up a contract, write out your day care policies, and require that potential clients (or, more likely, the parents of potential clients) review and sign both documents before accepting their patronage.

If you're just starting to read up on how to start a day care business, you might not be clear on the distinction between these two documents. To clarify, your contract is the document stating that you’ll provide child care, be compensated for providing care according to the payment terms you specify, and have the right to terminate providing care.

Your policies, on the other hand, provide parents with important logistical information regarding how you’ll run your day care center. There, you can outline protocol regarding vacation, illness, inclement weather, drop-off and pickup times, curriculum, field trips, and anything else you believe is important for your clients to understand and agree to about your day care center.

On a similar note...

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Daycare Business Plan

What is a Daycare Business Plan?

A daycare business plan is an equivalent of a roadmap in your business journey. A plan helps you understand what you’re getting yourself into.

It helps you understand the market, figure out where you stand in it, know your target audience better, and formulate better marketing and financial strategies.

Overall, it makes your decision-making process faster and more effective and prevents you from feeling clueless at any point in your business journey.

Moreover, it also helps you get investors and helps your employees and partners understand what your business stands for. It gives the people in your business a feeling that you have a vision and know what you are doing with your business.

Also, you get to set clear goals that give you a direction to work and put your efforts in.

Why is a Daycare Business Plan Important?

Everything you do for your business should add value to it. And here’s how a daycare business plan can add value to your business:

It gives you a sense of direction

There are several ways you can go with each business decision. A business plan helps you understand what would work best for your business then.

Also, it gives a set of tangible goals to look forward to when you work on your business.

It helps you understand your target audience better

Planning your business gives a better form and structure to your research. Which at the end of the day helps you understand your customers better. It also helps you analyze what it means for your business.

Making and upgrading your product or service for your customers serves the biggest purpose at the end of the day.

It helps you understand your competition better

Imagine there’s a popular daycare center in your city and several parents swear by it. Now, this could mean several things for your business.

You’ll have to pick a different location, know the daycare service’s weaknesses and offer better services by working on that area for your business.

You can also pick the things they are doing right, and inculcate the same in your strategies.

A business plan can help you do all of the above and more through a competitive analysis.

It helps you convince your investors

Though making the right prediction is difficult, having a rough idea of your business’s sales and financial potential is important to get investors on board.

Investors want to know the scalability of your business before they invest in it. A good and realistic prediction of returns makes it easier to convince investors.

And a business plan can help you make realistic financial predictions.

It keeps you updated with the latest business trends

A business plan is a living document that grows alongside your business. It also helps you have a foresight of changing trends and act on time for getting the best results for your business.

This also makes it important for you to keep updating your plan as your business grows.

What does a Daycare Business Plan Look Like?

If you are planning to start a new auto or car repair shop, the first thing you will need is a business plan. Use our sample Daycare Business Plan created using Upmetrics business plan software to start writing your business plan in no time.

Before you start writing your business plan for your new auto repairing shop, spend as much time as you can reading through some examples of Children’s & Pet business plans .

Moreover, business plans come in different forms to fit the current state of your business.

Apart from that, there are a few major sections that should be included in every business plan.

Daycare Business Plan Outline

This is the standard business plan outline which will cover all important sections that you should include in your business plan.

Executive Summary
Keys to Success
Company Summary
Timothy Bernard Kilpatrick
Start-up Summary
Locations and Facilities
Service Description
Competitive Comparison
Sales Literature
Fulfillment
Future Services
Industry Analysis
Market Segmentation
Market Analysis
Market Needs
Market Trends
Market Growth
Business Participants
Competition and Buying Patterns
Main Competitors
Strategy and Implementation Summary
Value Proposition
Competitive Edge
Positioning Statement
Pricing Strategy
Promotion Strategy
Marketing Programs
Sales Forecast
Sales Programs
Strategic Alliances
Web Plan Summary
Website Marketing Strategy
Development Requirements
Management Summary
Organizational Structure
Timothy B. Kilpatrick
Carolyn Steverson
Candice Harris
Management Team Gaps
Personnel Plan
Projected Profit and Loss
Projected Cash Flow
Projected Balance Sheet

What to Include in Your Daycare Business Plan?

A good daycare business plan consists of a certain number of well-defined sections, the following sections can help you in writing an excellent business plan.

1. Executive Summary

The executive summary section is one of the most important sections of your business plan because it not only forms the first section of your business plan but also acts as a pitch for potential investors who can provide you with funds for your daycare business.

It consists of your company’s vision and mission, its USP, objectives, and also expected revenues.

Writing the executive summary section of your plan at the very end, so you can sum up your plan properly is a good tip to remember.

2. Services

In this section, you should give out a clear idea of what your services are and whom it caters to. You should define your target market, your niche, the area your services will be extended to, etc.

As a daycare center, you should have a clear idea of the age group you will cater to, what is the preferred location of your target audience, how you come off as a service to your customers, and so on.

3. Market Analysis

Market analysis can be of great help to any business, it can help you understand what you are getting yourself into, who your competitors are, what your client base expects out of you, and where you stand in the current market situation.

Hence, market analysis immensely improves your understanding of the industry you are getting into. In the case of a daycare center knowing the best practices of childcare that exist in the market can be of great help.

4. Web Plan

In today’s internet-based world, most busy parents looking for a daycare center online. Hence, having a strong and reliable web presence is crucial to the success of your daycare business. Thus, including a web strategy in your business plan is necessary.

Always remember, as a daycare service coming off as a trustworthy and reliable institution is crucial for your business to work.

5. Management and Organizational Structure

Having a well-structured management system is especially crucial for a daycare service. It not only helps your business run smoother, but it also makes you look more responsible and reliable in front of the parents or the primary caregivers.

In this section, you should include the structure of your organization, details about people on various levels in your company, a solid system for tracking everyone’s work and progress, the areas your team is excelling at, and the areas your team is lagging in.

6. Financial Plan

One of the chief reasons for several daycare services running out of business is poorly managed finances or running out of funds to keep going.

Planning your finances in the early stages of your business saves you from encountering such a problem later on.

Hence, planning your finances is mandatory while writing a business plan.

Download a sample daycare business plan

Need help writing your business plan from scratch? Here you go; download our free daycare business plan pdf to start.

It’s a modern business plan template specifically designed for your daycare business. Use the example business plan as a guide for writing your own.

The Quickest Way to turn a Business Idea into a Business Plan

Fill-in-the-blanks and automatic financials make it easy.

Daycare Business Plan Summary

In conclusion, apart from having a good image as an organization, a well-managed team, a clearly defined niche, thorough research of the market and an excellent financial plan is crucial to the success of a daycare business.

After getting started with Upmetrics , you can copy this sample daycare business plan into your business plan and modify the required information and download your daycare business plan pdf or doc file.

It’s the fastest and easiest way to start writing your business plan.

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Upmetrics is the #1 business planning software that helps entrepreneurs and business owners create investment-ready business plans using AI. We regularly share business planning insights on our blog. Check out the Upmetrics blog for such interesting reads. Read more

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How to Start a Daycare Business Plan

A Step-by-Step Guide for Childcare Planning with Tips to Help Entrepreneurs Start Their Daycare Business

What is daycare and why should i start one.

Types of Daycare Providers
Before Starting Your Daycare Business Essential Planning Steps
Decision Journey Map Definitions

Assess the Competition

How to start your daycare business.

The Importance of an Execution Plan
Execution Plan: Marketing and Sales
Form Your Daycare Business

Get Familiar with Daycare Licensing Requirements

Choose Your Insurance and Liability
How to Gain Enrollment at Your Daycare
Invest In Childcare Experience Software to Build Your Daycare with Less Work

Build an Expert-Level Business Plan for Daycare

The childcare industry is full of passionate, hard-working individuals. Entrepreneurs just like you are starting a daycare from the ground up. In this guide, we'll give you guidance and provide templates to build a solid daycare business plan.

According to Forbes , daycare businesses were projected to have some of the fastest employment growth of all industries through 2020. Starting a daycare is a great opportunity for aspiring business owners who have a passion for early childhood education and child development.

‘Daycare’ is an umbrella term for various childcare options (such as Montessori, head start programs, preschool, and many more) where parents and guardians drop their children off and leave them in your care to...

Socialize with other children in their age group
Learn basic fundamentals for future academic success
Reach important developmental milestones

Is Starting a Daycare Business Worth It?

Starting a childcare business or franchise is profitable, emotionally rewarding, and sustainable – the need for committed childcare entrepreneurs has never been greater.

As of 2021, there were 856,238 childcare centers in the United States. The growing popularity of childcare centers comes from the demand. Parents will always need a form of care for their kids. Plus, there’s a necessity, especially beyond COVID-19, to socialize children in an environment that fosters development.

Types of Daycare Providers

In-home daycare
Relative care
Preschool
Independently-owned daycare
Daycare franchises

The Difference Between Individual Centers and Franchises

An independently-owned daycare often has an individual owner, a center director, and possibly a few other administrative staff members – along with teachers, cooks, bus drivers, etc. The owner is typically an individual who puts their own money and savings into opening the daycare, so all business rights (name, branding, etc.) belong to them.

Alternatively, a daycare franchise falls under a corporate brand that has made an agreement with an individual to legally establish a business – using the company’s brand or trademark. In this scenario, the franchisee usually pays an initial fee, as well as ongoing royalties to the corporate franchisor. In return, the franchisee gains the use of a trademark, support from the franchisor, and the right to use the franchisor's system of doing business (including unique business policies and procedures, such as their method for advertising or enrollment). This model can be particularly beneficial for individuals who are passionate about early childhood education but don’t know how to get started on their own.

For example, Kids R Kids and Kiddie Academy are both successful daycare business plans in the United States. Each center operates similarly, has the same name (aside from a unique location number or city/county name), and the same branding as all locations fall under the franchisee umbrella.

Daycare Franchise Terms

A franchisor is a daycare company that provides its services, brand, and business operations to the individual. This may also be known as a ‘ franchise system ’.
A franchisee is an individual owner that is being supported by the company (franchisor). Buying into a daycare franchise makes you the franchisee.
The franchise refers to the legal agreement between the company and the franchisee.
The franchise disclosure document is the legally binding contract between the company and the individual.

Essential Planning Steps Before Starting Your Daycare Business

1) conduct market research.

When it comes to starting your childcare center, relying on assumptions about your customers and competitors leads to wasted time, money, and effort. In contrast, businesses that conduct regular market research improve customer retention and are 76% more likely to see an increase in revenue.

Market research is a data collection process that evaluates both consumer behavior, competitor habits, and industry trends to determine the viability of your center and build a foundation for future business operations.

Prepare for success upfront by conducting thorough market research to understand your competition, improve communication with your target audience, and identify new market opportunities. This research should result in actual data that you can use to drive your business and marketing strategies as you launch your center.

There are a variety of tools available to help you conduct market research - all from the comfort of your own office. Gone are the days of hiring team members with clipboards to approach consumers face-to-face. Survey Monkey, Attest, and Sprinklr all offer digital market research tools to help guide you through the process of understanding your audience, your competitors, and your industry.

2) Determine Your Target Market

A market segment is a group of consumers that could potentially enroll at your childcare center. First, identify your daycare target market segments and determine how big each segment is.

Be careful not to fall into the trap of defining your market as “everyone in your community.” This often leads to a ‘spray and pray’ approach to your marketing and as we know, a message for everyone really speaks to no one. When you generalize your advertising in favor of not isolating a potential consumer, you aren’t able to effectively communicate with your ideal customers – forgetting to recognize how your childcare center can appeal to them and their needs.

A classic example is a shoe manufacturer. While it would be tempting for a shoe company to say that their target market is anyone who has feet, realistically they need to target a specific segment of the market in order to be successful. If they sell adult athletic shoes, they should be building their message to target athletes or individuals who enjoy staying active and exercising. Likewise, if you offer programs for children aged 6 months to 4 years old, you should prioritize advertising toward young adults in their 20s and 30s.

A common strategy when identifying target markets is to use the TAM, SAM, and SOM approaches to look at market sizes from a top-down approach as well as a bottom-up approach.

Target Market Terms

This should include everyone you wish to reach.

Example: Your entire local community.

SAM: Your Segmented Addressable Market or Served Available Market

This is a portion of the TAM you will specifically target because they align with your offerings.

Example: Families with young children.

SOM: Your Share of the Market

This is the group of your SAM that you will realistically reach—particularly in the first few years of your center’s opening, as you may expand and grow your service over time.

Example: Families with young children who make at least $65,000 each year in household income.

For childcare organizations with multiple brands, schools, or programs - increasing revenue and keeping families happy is vital for growth. Your Millennial parents need a uniform, high-quality experience, regardless of location.

Standardizing business processes has a significant impact on time savings, costs, and most notably quality. In fact, standardization improves quality by 61.9% , on average. Create consistent enrollment processes across all your franchise locations to ensure every family has a great experience and a positive association with your brand – leading to higher conversion success and profitability.

To achieve consistency, your franchisees’ marketing approach and advertising material must follow all your corporate brand guidelines. Your organization should have a lead management system that supports your childcare franchise staff as they guide families through the decision-making journey while also ensuring each location is delivering a consistent parent experience.

3) Develop Your Buyer Personas

Before you begin writing your daycare marketing plan, make sure you’ve defined your market and buyer personas. Without a deep understanding of whom you’re speaking to, a daycare marketing plan will have little value.

Audience personas allow you to dive even deeper into your target market and help you understand more than just who your customer is. These identities inform you how to communicate with your customers in a way that relates to their pain points and needs.

Building a daycare business plan is no joke! Check out childcare business tips at a glance .

When you understand your customer’s motivations, you can uniquely address their concerns and questions in your marketing materials - leading to increased tours, enrollments, and revenue.

Start by listing out the various kinds of programs and classes you’d like to offer at your center.

Then, determine who the primary decision-maker is and who the primary influencers might be in each scenario.

Primary decision-maker : typically the individual(s) taking financial responsibility and remitting payment at your center.

Primary influencers : are also crucial in the purchasing process as they often have the ability to sway decision-makers.

For example, imagine you’re promoting availability for Summer camp programs at your center. In this instance, the primary decision-maker might be the parent(s) or guardian(s) whereas the primary influencer would likely be the child who’s deciding what kind of activities they want to do this Summer.

Audience Overview

List the audiences, personas, or segments that you want your center’s marketing and messaging efforts to reach.

Select one audience from above and describe it to the best of your knowledge. Go beyond the traditional persona to consider motivations & behavior.

Identify the key stages in your audience’s enrollment journey from beginning to end, knowing there may be multi-dimensional steps within a stage. Complete the table for each journey at the individual stages from the specific audience’s point of view.

Decision Journey Map Terms & Definitions

Stage : This refers to each stage of the enrollment journey - awareness, consideration, action, and advocacy.

Awareness : This is when a family is first learning of your center and your brand. They are researching multiple daycare centers and eventually send an inquiry to tour your facility or learn more.

Consideration : During this stage, a family is touring your center and may be deciding between you and 1-2 other providers. Tip: Proactively equip your staff with key talking points so they can highlight your unique center features.

Action : This is when a parent decides to register their child for care, pay fees, and is either placed on your waitlist or enrolls.

Advocacy : After a successful, happy experience, this parent or guardian has become an advocate for your business. They’re telling friends and family about your center. This is vital for your word-of-mouth marketing strategy.

Emotion : Identify what the persona is feeling at each stage of the customer’s journey. They may be anxious, curious, excited, or satisfied at various points. Put yourself in their shoes.

Key Actions : What actions would a consumer take at each stage? For example, during the awareness stage, they may see your ad on Facebook, look you up on Google, or visit your website. In the consideration stage, they may call your center to get more information, look at your services online, or read reviews.

Questions : What questions is the consumer asking in each stage? These are the questions you need to be answering for them in your advertising and marketing efforts.

Competitive research helps you understand why customers choose your center over other alternative care options. This information provides you with insight into how your competition is marketing their services and over time, this can help you improve your own marketing campaigns and business offerings.

Look up similar daycare centers in your area, and see what programs they offer, the type of facilities, their capacity, and their curriculum. Then, highlight the features that make your center stand out. Showcase your selling points in all marketing and advertising efforts. Get started with these key questions...

Who are my direct competitors and what do they offer?
Who are my indirect competitors
What does my competition's pricing look like?
Do they offer promotional pricing or payment plans?
What do they do best?
What do they do poorly?

Download the guide to stay up to date on the latest industry news, trends and best practices for growing and managing your childcare business.

Download the Guide

Build a Daycare Business Plan

A good business plan will guide you through each stage of starting and managing your childcare organization- including how to structure, run, and grow your new business.

There’s no correct or incorrect way to write your business plan. What’s most important is that you identify your business objectives and use this document as a roadmap for how to achieve these goals.

A strong business plan can help you recruit business investors, gain funding, or find new partners. Prospective investors want to feel confident they’ll see a return on their investment and your center’s business plan is the perfect tool to assure potentials that working with you — or investing in your business— is a smart and profitable decision.

Write a Day Care Executive Summary (Daycare Business Plan Outline)

Although this section is the first thing people will read, it’s advised that you write it last, once you know the details of your business inside and out. At this stage, you will be able to articulate your business more clearly and summarize all the information in a succinct, concise manner.

Ideally, your executive summary will be able to act as a stand-alone document that covers the key highlights of your detailed business plan. In fact, it’s common for investors or loan providers to ask for just the executive summary when they start evaluating your business. If they like what they see in the executive summary, they’ll often follow up with a request for a complete plan, a pitch presentation, and more in-depth daycare business plan financials.

As your executive summary is such a critical component of your business plan, you’ll want to make sure that it’s as clear and concise as possible. Cover only the essential components of your daycare, ensuring your executive summary is one to two pages maximum. This section is intended to be a quick read that hooks your potential investors’ interest and excites them to learn more.

The executive summary is a tell-all first paragraph that details...

The city and state of your center (you can decide on the exact location later)
A potential open date
A projected enrollment count (number of full-time enrollments)
Programs you plan to offer
Ages you hope to serve
A quick financial summary (based on grants, funding, and potential revenue from projected enrollments)

This may seem like a lot of information upfront, but it’s simply a high-level overview of your plan.

Conduct an Opportunity Analysis

The opportunity section of your business plan includes information about:

The problem that you’re solving within your community
P rograms and classrooms do you plan to market your center(s) to
How your daycare facility fits into the existing competitive landscape

Opportunity Analysis: An Example

The opportunity analysis portion of your business plan is important for outlining what distinguishes your daycare from your direct and indirect competitors. It details how you can continue to expand and grow your center in the future.

Use your previous competitive research to determine your daycare business’s competitive advantage and position. Analyze potential strengths, weaknesses, opportunities, and threats.

Problem and Solution

Describe the problem that you are solving for your customers. Childcare centers are need-oriented, meaning your consumers have tangible pain points that you must resolve to be successful.

So, what is the primary pain point for them? Maybe it’s that busy, working parents need a caring, safe place for their child during the day, or perhaps families are seeking after-school care options for their elementary-aged children, or maybe parents need 24-hour childcare options when they’re traveling or working odd hours.

Now, assess how they are solving their problems currently and where there’s room for improvement. If there's only one childcare center in your community and it has no open seats, you could be the solution. Or maybe there are lots of existing care providers in your city but they’re expensive or have rigid pickup and drop-off times that working parents have trouble meeting. Or perhaps there aren’t any existing childcare businesses within a reasonable driving distance of where you’d like to place yours.

Defining the problem you are solving for your customers is by far the most critical element of your business plan and is crucial for your daycare business’ success. If you can’t pinpoint a problem that your potential customers have, then you might not have a viable business concept.

To ensure that you are solving a real problem, try conducting your own survey with potential customers to get a better understanding of their needs and validate that they have the problem you assume they have. Then, take the next step and pitch your potential solution to their problem.

Do they agree that it’s a good fit or does it seem to fall flat? See how to come up with a strategic plan for your business.

The Importance of Creating an Execution Plan

The execution chapter outlines how you’re actually going to make your childcare center work . You’l l address your marketing and enrollment plans, operations, success metrics, and any key milestones that you expect to achieve.

Execution Plan: Marketing and Sales

The marketing and sales plan section of your business plan details how you propose to reach your target market segments, how you plan on converting those target markets, what your pricing model looks like, and what partnerships you may need to make your center a success.

Your Positioning Statement

Once you understand your audience, the first part of your marketing and sales plan is your positioning statement. Refer back to your value proposition to create a simple, straightforward sentiment, explaining where your company sits within the competitive landscape and what differentiates your venue from the alternatives that a customer might consider. This statement should be written for an investor or loan provider, rather than for your customer.

One daycare business plan example - a positioning statement for a 24-hour childcare center in Austin, Texas may look like this:

“For the Austin-based family who is seeking childcare around the clock, Jenny’s 24-Hour Daycare is a safe option for young children with nutritional meals, best-in-industry sleeping arrangements, a clean outdoor play area, and highly trained care professionals. Jenny’s 24-Hour Daycare is the first center of its kind within 30 miles of the Austin metroplex and offers competitive pricing and tuition payment plans.”

Use this formula to develop a positioning statement for your center:

Your Mission Statement

Your mission statement is a scaled-down version of your positioning statement. This should be just one or two sentences that are geared toward your target consumer and describe what your business plans to accomplish. This statement usually includes company core values that explain your daycare’s purpose and how you serve your audience.

For example, Cadence Education is a leading early childhood education provider with the mission of “providing parents with peace of mind by giving children an exceptional education every fun-filled day in a place as nurturing as a home .”

Pricing

Your positioning strategy will typically determine how you price your memberships and packages. There are some basic rules that you should follow when deciding on your price point:

Cost-plus pricing : For the most part, you should be charging your customers more than it costs you to host them at your center to ensure your venue is profitable and appealing to investors.
Market-based pricing : Look at what your competitors are charging and then price based on what your audience is expecting.

Strategic Alliances

As part of your marketing plan, you may wish to collaborate with other organizations such as local camps, after-school programs, pediatricians, or even other childcare centers that don’t offer the same activities that you do.

This partnership should benefit both of you – it may help provide access to a target market segment for your venue while allowing your partner to offer a helpful recommendation to their customers. If you’ve already established an alliance, it’s important to detail that in your business plan.

The operations section is all about how your business works. This portion details the essential logistics such as staffing and sourcing and fulfillment. But remember, your goal is to keep your business plan as short as possible, so too much detail here could easily make your plan much too long.

Milestones and Metrics

It’s critical that you take the time to look forward and schedule the next critical steps for your business. Investors will want to see that you understand what needs to happen to make your plans a reality and that you are working on a realistic schedule.

Then, determine how you will measure the success of each milestone by listing out the key performance indicators and metrics needed to see progress. These will be the numbers you monitor on a regular basis to evaluate the trajectory of your business. For example, you may look at how many families tour your center each week, how many children you enroll each month, or the amount of revenue you bring in per quarter.

Company and Management Summary

The structure of your staff and teams sets your daycare up for success. In a new daycare center, there’s typically an owner (or franchisee), a center director, staff members, an enrollment or marketing team, accounting/administration, teachers, assistants, cooks, bus drivers, and janitorial staff. For example, the average small daycare business plan includes 8-10 fully licensed and/or certified early education teachers.

Financial Forecasts

A typical financial plan will have monthly sales and revenue forecasts for the first 12 months, and then annual projections for the remaining three to five years. Break your sales forecast down into several rows, focusing on just high-level buckets at this point.

Knowing how much your daycare will cost to open ahead of time can save you money, stress, and time. Daycare business plan start-up expenses vary by size, enrollment capacity, and miscellaneous needs.

Keep in mind that you can save on staffing costs and cut down on overhead with technology that helps to streamline your center’s operations. After all, 40% of Millennials prefer self-service over human contact when interacting with businesses.

It’s essential that you find ways to enable families to book tours and enroll online without ever having to make a phone call to the center- reducing time spent on necessary-but-manual tasks for both your staff and inquiring families.

Finally, articulate your profits and losses based on the data from your sales forecast and your personnel plan plus a list of all your other ongoing expenses associated with running your childcare center.

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See this Formula for Financial Forecasts

Step 1 : Average cost of tuition per child x your expected enrollments x 12 (annual revenue – assuming each family enrolls their child in one of your summer programs).

Step 2 : Daycare businesses make around 16% profit from their overall revenue, after daycare expenses. Multiply your number from step 1 by .16 to get your predicted profit.

Example : Let’s say you plan to charge families an average of $315 per week for childcare. With that, your goal is to enroll 60 students by the time your daycare center opens. Multiply $315 x 60 x 12 (annual revenue). This should come out to $226,800. Lastly, multiply your revenue of $226,800 by .16, which equals a net profit of $36,288 per year.

Consider Various Funding Sources

Depending on your situation, there’s both loan and grant funding in childcare. Between state tax credits, loans, and grants – there are financing options for a variety of situations.

Review Your Tax Deduction Options

Collecting tax credits is one way to receive an annual deduction on daycare costs. Based on your state, you can claim tax credits for...

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Collect Daycare Grants for Your Business

Often, startup costs for opening a daycare are high. Certain states and counties offer grants for new daycare businesses. There are several grant options, depending on your child and family details.

For example, there’s a Preschool Development Grant Program and a Head Start/Early Head Start grant to provide funding that expands early childhood centers and developmental programs.

Know Which Loans Are Available to Daycare Business Owners

While grants are a wonderful option for freshly opened daycare businesses, loans are occasionally easier to come by. They’re offered widely and often have fewer requirements to qualify. Check out a few loan examples for your daycare center.

SBA Loans , otherwise known as Small Business Administration loans, have exceptional rates, low interest, and flexible repayment options.
SBA 7(a) Loans are beneficial for covering pricier equipment funds and real estate. Loans of up to $5 million are available to daycares.
SBA 504 Loans – these are wonderful for business expansions and involve a loan for 50% of the project cost.

Take Actionable Steps to Bring Your Daycare Business to Life

Both Limited Liability Companies and Incorporations offer the significant legal advantage of helping to protect assets from creditors and provide an extra layer of protection against legal liability.

The main difference between an LLC and a corporation is that an LLC is owned by one or more individuals, and a corporation is owned by its shareholders. In general, the creation and management of an LLC are considered simpler and more flexible than that of a corporation.

Find the Right Vendors

Choosing the right suppliers for your business is essential. If your vendors aren’t reliable or don’t deliver quality products, your new center will struggle to attract families. As a childcare provider, you will likely need the following vendors at one point or another:

Electrician
Plumber
Food and Beverage Supplier
Educational Materials Supplier
Substitute Staffing Provider
Accountant
Childcare Licensing Consultant
Cleaning & Maintenance
Childcare Management System (CMS)
Customer Relationship Management (CRM) Software
Digital Payments Provider
Online Forms Software
Childcare Experience Software

All states have different daycare licensing requirements. Generally, you'll follow the steps below.

1) Take a Course

Attend and complete a pre-application course (you’ll receive a certificate at the end – remember to save it).

2) Submit Your Application

Submit your online licensing application. It'll ask for details about your business that were outlined in the executive summary.

3) Pay Fees

Pay your application fees. The fee depends on your center's capacity or the number of children you plan to enroll.

4) Complete Inspections

An inspection of your business property must be conducted.

5) Submit Your Service Payment

6) Conduct Background Checks

Submit background checks (this may also be an additional charge).

For More Information on How to Operate In Licensing Excellence, Listen to the Podcast Below

Choose Your Insurance and Liability

Provide general liability – stay covered if your center has any property damage or injuries to third parties (children).
Abuse coverage protects your childcare business or franchise. If employees turn out to be abusive towards children, this policy covers defense costs and defends you against financial losses.
Professional liability insurance provides coverage for your business and workers if there is a neglect claim.
Hired and non-owned auto liability ensures everyone is covered if there is a pick-up/drop-off vehicle accident.

*Liability requirements may vary by state.

How to Gain Enrollment at Your Daycare

From a business owner's perspective, the next step after successfully starting your daycare is to grow your center and gain enrollments.

Begin by building a strong company culture, actively marketing your daycare center, and finding the right childcare technology to optimize your enrollment process and save time.

See how to elevate your business plan for daycare with better waitlist management.

Create a Culture Where Staff Want to Work

A daycare center that stands out from the rest has happy staff members that want to work hard. Create a diverse employee culture that feels comfortable openly talking about situations. Provide support, patience, and room for growth. See more tips for creating a healthy and positive culture for your daycare staff .

Market Your Center

A daycare marketing strategy starts with an achievable goal. Do you want to fill your enrollment spots? Do you want to build a waitlist? Should you focus on scheduling more tours or gaining new leads ?

Choose a goal with measurable results. That way, you can track and analyze your marketing performance. When it comes to how to promote daycare business, marketing helps families realize you're the best childcare center on the block. Promote your centers through...

Social media (especially Facebook – 83% of Millennials have a Facebook account).
Landing pages and contact forms on your website
Listing directories
Email and text marketing campaigns
Referrals
Digital advertisements
Flyers
Word-of-mouth marketing

Tip: childcare experience software that automates the reports you need helps you to save time and improve your return on investment (ROI). For example, a Source of Families report shows you where your leads are coming from to optimize your efforts.

Invest In Childcare Experience Software to Build Your Daycare with Less Work

LineLeader is revolutionary childcare software that automates lead capture, follow-up, scheduling tours, and reports. Craft beautiful, personalized marketing campaigns to continually grow your business. Plus, easily manage your curriculum, attendance, and billing with automated center management

Get more from your marketing while saving franchisees 10 hours every week with LineLeader. Automate everything from lead capture and reporting to center management—all from one place.

Download Your Guide

Resources to help you run your childcare business.

5 Ways Your Childcare Center is Losing Money and Opportunities

childcare franchise business owner in childcare daycare center

5 Ways Your Childcare Franchise is Leaving Money and Opportunities on the...

ECE, childcare executives, early childhood education, CRM, CMS, center management, multi-site childcare

Disrupting the Status Quo in ECE: Business Ops’ Quest for Financial &...

Additional resources.

For more information on specific childcare resources regarding marketing tools, campaigns, tips, and best practices - see below.

1. Learn hidden secrets no one tells you about starting a childcare business .

2. See how to operate in childcare licensing excellence to boost enrollment.

3. Beth Fiori of Tiny Treasures provides expert tips. check out ways to improve your business plan for daycare with enhanced waitlist management.

4. Discover tips to maintain the best childcare center on the block.

5. Gain advice for strengthening your daycare staff culture.

6. Learn the benefits of building a daycare business plan , at a glance.

LineLeader Video Resources

BUSINESS STRATEGIES

How to create a daycare business plan

Nirit Braun
Sep 11, 2023

When you're getting ready to launch your daycare business, one of the first things you'll want to do is create a solid business plan. Think of it as your roadmap for success. This document spells out your goals, strategies and financial projections within the childcare industry.

It serves as your trusty guidebook, helping you navigate the path to success and providing solutions for any challenges that come your way. Keep reading to learn more about the specific elements of a strong daycare business plan, and use the template at the end to get started.

Ready to launch your daycare business? Create a business website today with Wix.

Top benefits of creating a daycare business plan

Starting a daycare business demands careful planning, and a well-structured business plan offers numerous benefits that can significantly contribute to its success:

Helps raise money for your business : Experts estimate that for a home-based daycare serving four to six children, startup costs can exceed $36,000 . A comprehensive business plan is essential when seeking investors or financial support. It showcases your clear vision, market research and growth strategies, demonstrating your commitment and knowledge about the daycare industry. Potential investors are more likely to provide funding when they see a thoughtfully crafted plan that outlines potential returns on their investment.

Helps allocate resources : Writing a business plan forces you to conduct thorough research on what resources, supplies and staff are needed to launch and run your daycare center successfully. From facilities and equipment to educational materials and safety protocols, this detailed analysis ensures that you're fully aware of the startup and operational costs, preventing any unexpected surprises down the road.

Provides operational clarity : A well-constructed business plan outlines your daycare center's daily operations, including schedules, curriculum and staffing requirements. This clarity not only helps you understand the practical aspects of starting a business but also provides a structured approach to managing day-to-day activities effectively.

Highlights market insights : Through the process of writing your business plan, you delve into market research, identifying your target demographic, understanding their needs and analyzing your competitors. According to Zippia, 58% of working parents depend on childcare centers, which means you have a very large market to work with. This information is invaluable in tailoring your services to stand out in a crowded niche, creating a unique selling proposition that attracts parents and caregivers.

Helps with risk management : Starting a daycare business involves addressing potential challenges and risks. A business plan encourages you to identify these risks upfront and develop contingency plans to mitigate them. This proactive approach increases your preparedness and helps you navigate unexpected obstacles with more confidence.

Creates a profitability timeline : Financial projections included in your business plan offer insights into the revenue and expenses expected in the early stages of your daycare business. This information is crucial for determining when your business will become profitable and ensuring that you have a sustainable financial strategy.

Learn more: How to start a service business

How to create a successful daycare business plan in 6 steps

Now we’ll walk through the six essential steps for crafting a daycare business plan tailored to your company's unique needs.

Executive summary

Business and domain names

Market analysis and research

Operations plan, marketing and advertising plan, financial plan.

Thinking of developing another type of business? Check out more service business examples .

01. Executive summary

The executive summary is a concise overview of your entire daycare business plan. It provides a snapshot of your business concept, key strategies, goals and financial projections. While it appears at the beginning of your plan, it's often written last, after you've fully developed the other sections. A well-written executive summary should capture the reader's attention and convey the essence of your daycare business in a compelling and clear manner.

To write a clear executive summary for a daycare business, incorporate the following details:

Overview : Introduce your daycare business and highlight its unique features. Mention the age groups you'll serve, the educational approach you'll adopt and any specific services or benefits that set your daycare apart.

Demand : Describe the demand for daycare services in your target area. Mention any growth trends in working parents, shifting demographics or changes in government policies that could impact your business.

Operations : Briefly outline your strategies for attracting and retaining customers, managing operations efficiently and achieving growth. Touch on your marketing, staffing, curriculum and safety plans.

Staff : Highlight key members of your management team and their relevant experience in the daycare or education sector.

Financials : Provide a high-level overview of your projected revenue, expenses and profitability. Mention the timeframe you expect to break even and showcase your potential for generating returns for investors. You can also mention the amount of initial investment you're seeking and how you plan to use the funds.

Example executive summary for a daycare business

“ABC Sunshine Daycare is a premium childcare center dedicated to providing a nurturing and educational environment for children aged six months to five years. Our play-based curriculum, experienced educators and commitment to child safety make us the ideal partner for parents seeking top-tier care. With a projected 15% annual growth in working parents in our area, we are poised to tap into a significant market opportunity.

Our key strategies include partnering with local businesses to offer exclusive discounts to their employees, implementing a comprehensive child development curriculum and maintaining a low student-to-teacher ratio for personalized attention. We anticipate achieving profitability within the first 18 months, with a projected revenue of $350,000 by the end of Year 2.

We seek $150,000 in funding to secure a prime location, equip our state-of-the-art facility and launch targeted marketing campaigns. Our leadership team comprises experienced educators and childcare professionals, ensuring the highest quality of care for our young learners.”

02. Business and domain names

Knowing how to name a business is crucial for a daycare center and a key step before you register your business . It will be the foundation of your brand identity, influencing how parents perceive your services and creating trust. When choosing a name, consider its relevance to child care, its uniqueness and its ease of pronunciation and memorability.

Using a business name generator like one from Wix can spark creativity and offer unique suggestions that align with your daycare's values and mission. Once you've settled on a name, securing a matching domain name is essential for establishing an online presence. A domain name that reflects your business name makes it easier for potential clients to find you online.

You’ll want to first conduct a domain name search to ensure that the name you want isn't already in use.

Some best practices for choosing a domain name are to keep it short and memorable, which means avoiding complex spellings or special characters. Be sure to make it relevant to your specific services and values. The recommendation is to choose a domain extension (.com, .net, .org) that's familiar and commonly used.

03. Market analysis and research

Strong market analysis is vital for understanding the competitive landscape for this type of business and identifying opportunities where you can thrive. Research the demographics and psychographics of your target audience, their needs, preferences and pain points. Analyze your competitors—both other daycare centers and alternative childcare options—to identify gaps in the market that your business can address.

Incorporate this analysis into your business plan to develop a more robust marketing strategy . Highlight how your daycare's unique value proposition will resonate with parents and differentiate you from the competition. Include plans for pricing, branding, promotions and customer retention strategies to attract and retain families.

04. Operations plan

Your operations plan outlines the practical aspects of running your daycare business. This includes details such as:

Location: Explain the rationale behind your chosen location, considering factors like accessibility, safety and proximity to potential clients.

Premises: Describe the layout and design of your facility, including play areas, classrooms, restrooms and any outdoor spaces.

Equipment: List the equipment and supplies required for daily operations, from educational materials to furniture and safety equipment.

Staffing: Outline your staffing needs, including teachers, assistants and administrative personnel. Detail their qualifications, roles and responsibilities.

Healthy and safety: Highlight your health and safety protocols, emergency procedures and compliance with relevant regulations.

By including these details in your operations plan, you demonstrate a clear understanding of how your daycare business will function and meet the needs of both children and parents.

05. Marketing and advertising plan

To get started with marketing, you’ll need to develop a suite of brand assets, starting with a company logo. You can use a free logo maker to get a professional design in minutes.

Learn more: How to make a website

Your marketing and advertising plan outlines the strategies and campaigns you'll employ to promote your daycare business. Consider a mix of both traditional and digital marketing methods, such as social media. Utilize online platforms like Facebook, Instagram and Pinterest to share engaging content, showcase your facility and connect with parents. You can also use your social media accounts to collaborate with local businesses, pediatricians and schools to build a referral network and increase visibility.

Use your business website for targeted online ads to reach parents in your area who are actively searching for childcare options. Additionally, you could publish a blog on your website that offers parenting tips, educational insights and other valuable content that positions your daycare as an authority in child development.

You can also organize open houses, workshops, or parent-child events to give families a firsthand experience of your daycare's offerings.

06. Financial plan

The financial plan is a critical component of your daycare business plan, outlining your initial funding requirements, revenue projections and profitability timeline. Specify the sources of funding you're seeking—whether through personal investment, loans or investors—and detail how the funds will be allocated.

Provide a breakdown of your startup costs, including cost to start an LLC if relevant, expenses for facility setup, equipment purchase, staffing, marketing and any administrative costs. Present projected revenue based on enrollment estimates, pricing strategies and the competitive landscape.

Create a cash flow forecast that outlines your expected inflows and outflows over a specific timeframe. This projection will help you identify potential financial challenges and plan for adequate cash reserves.

Include a profitability analysis that showcases when you anticipate reaching break-even and becoming profitable. This information is crucial for both potential investors and your own financial planning.

By including a well-structured financial plan, you demonstrate your business' financial viability and your understanding of the financial aspects of running a daycare center.

Template for a daycare business plan

Note that this template is meant to serve as a starting point for your daycare business and you should customize it to reflect your specific business concept and goals.

A brief introduction to the daycare business concept

Market opportunity and growth potential

Key strategies for curriculum, staffing and marketing

Financial projections: revenue, profitability, funding needs

Company and domain name

Name: [Your Daycare Name]

Domain: www.[YourDaycareName].com

Demographics and psychographics of target audience

Competitive landscape analysis

How your daycare addresses market needs

Location details

Facility layout, safety features, outdoor spaces, etc.

Equipment, inventory and setup

Staff roles, qualifications and responsibilities

Health and safety protocols and compliance

Social media strategy

Local partnerships, collaborations with local businesses

Open houses and events

Online advertising plan and ad types

SEO and content marketing strategy

Initial investment requirement

Startup costs including facility setup, equipment, staffing and marketing

Projected revenue based on enrollment estimates and pricing

Cash flow forecast over the first year

Profitability and break-even point analysis

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The ultimate guide to starting a daycare business.

Why Start a Daycare?

Advantages to starting a daycare, can you start a daycare from home, how much does it cost to start a daycare, 15 steps to starting a daycare center, resources for daycare owners, bottom line.

Since most parents work outside the home, most preschool aged children receive some form of child care. While many are cared for by nannies, babysitters or other family members, nearly one-quarter (23.4%) of children under age five attend an organized daycare center.

This presents a world of opportunity for those looking to take the next step and start a child care business of their own. Starting a daycare center can be both personally fulfilling and financially rewarding.

Do you want to open your own daycare center in the U.S.? Follow along with this guide as we reveal the step-by-step process for opening a successful child care business.

Opening a daycare can be intimidating, but it can also be incredibly rewarding. While there is no blueprint for success, many child care business owners find joy in the journey. So whether it’s your passion for kids or desire to serve parents in your community, there are many valid reasons to open a daycare.

What’s important is that you also need to consider your own unique reasons for wanting to open a daycare, as these reasons will then motivate you to follow through on your dream. Even though you will face obstacles along the way, the payoff of opening a daycare is certainly worth the struggles.

Starting your own daycare business can be advantageous on multiple levels. For one, you’ll have the personal satisfaction of starting your own care center from scratch. Then, there’s the joy of spending time with children and learning life-changing lessons along the way.

If you’re still on the fence about starting your own daycare, consider these likely advantages:

Emotionally rewarding: Working with kids teaches you to be patient and enjoy the simple things in life. You’ll also have the flexibility of having your own business versus being confined to a traditional day job.
Financial freedom: By opening a daycare, you’re in control of your income rather than reliant on a typical paycheck. You can maximize your earning potential and make investments back into your own business.
Personal child care: If you have your own child, you can care for them while you’re running your daycare. This will save you money and give your offspring opportunities to make friends with other kids.
Continued education: Opening a daycare can open the door to new opportunities in the field of child care. You may be presented with another job position or choose to pursue additional education of your own accord.
Extra money: Rather than stay home and care for your own children for free (assuming the original plan was to be a stay-at-home parent), why not make some extra money by caring for other children at the same time?
Tax deductions: As a business owner, you can write of certain expenses as business expenses, saving you money on your taxes. These expenses can include a portion of your housing payment (if you have an in-home daycare), your cell phone bill, your vehicle, child care supplies and more. See Tax Deductions .

These are just a few of the many advantages of starting your own daycare center. Now let’s address some common questions you may have about being a daycare business owner.

Yes, starting a care center from your home is an option and may even be the more affordable option. This is because there are different options at the local, state and federal level that provide grants and funding to in-home daycare centers.

If you already have the space to run a child care business out of your home, it’s worth looking into Small Business Administration (SBA) loans to help you fund your endeavor. Remember, at the end of the day, you may be eligible for tax cuts and other benefits.

According to small business website bizfluent.com , the average startup cost for a daycare center is $10,000 to $50,000. This can vary widely depending on whether you’re opening a home-based daycare or leasing a separate facility for your care center.

If you don’t have $10,000+ in your bank account, don’t worry. There are many grants and loans available to child care businesses. In fact, some local businesses will offer financial incentives to support budding child care centers. Consider reaching out to your community for support.

Now, let’s get to the good stuff: how to start your own daycare business from start to finish!

Starting a small business in general is always a journey. While we’ve outlined a few steps to getting your business up and running, know that there is no one “right” way to achieve success. You’ll learn many lessons along the way and are likely to pave your own path.

That said, here are 15 steps to starting your daycare center, even if you have zero experience.

1. Learn About Daycare Licensing Requirements

You might have started off as a babysitter or a nanny, but in order to start a full-on daycare business, you need to meet the proper licensing requirements in order to be legal . That way, your daycare will be legitimate and you won’t run into any legal trouble accepting children into your care.

A good first step is to contact your state’s Department of Children and Family Services (DCFS) to learn about their specific regulations for child care providers. Another option is your local area’s child care licensing agency. You can usually find this information online.

To obtain a license to start a daycare center, you’ll also need a current CPR certification, a clean driving record and additional documents that prove your commitment to providing quality child care. Don’t be afraid to ask your local agency questions to ensure you’re satisfying all requirements.

2. Consider Taking Early Childhood Education Classes

While you don’t need to have professional child care experience to start a daycare business, having some understanding of early childhood development is strongly encouraged. You’ll be caring for young lives, so you need to know how to provide the right kind of support and care.

Getting a degree is early childhood education is a good place to start. You can typically find classes in-person at your local community college or online. Through this degree, you’ll gain a greater understanding of how children think and behave, and what they need in order to be properly cared for.

Beyond that, you’ll have the skills to set your business apart from your competition. You’ll be better prepared to offer the services parents are looking for and keep them coming back time and time again.

3. Create a Daycare Business Plan

In starting any type of small business, it helps to have a business plan. Having a business plan helps you set tangible goals for your business, organize your business structure, outline your services and so much more.

In your daycare business plan, you’ll define your daycare’s mission statement, operations and procedures, staffing and budget. This business plan works to keep you on track and striving toward success.

Consider how you want your business to be organized for you plan. Will you be solo or hire staff? How will you secure funding? Will you offer services beyond child care (like tutoring)? For help in creating your business plan, check out this detailed guide from the U.S. Small Business Association .

4. Find a Location for Your Daycare

If you plan on running your daycare out of your home, this step should be pretty straightforward. If not, you’ll need to find a location for your child care facility.

Many recreational centers, churches, local businesses and even schools have space available to host a daycare, typically for a monthly fee. Search online, in your local newspaper and within your network to find options in your area.

Once you’ve found a good fit, you need to check your city’s zoning laws and licensing guidelines to make sure your chosen location is compliant. That way you can avoid some legal headaches down the road.

Ideally, you’ll need to find a location that’s centrally located, easily accessible and child-friendly. Consider what children and their parents will be looking for in a child care center. You might not find the perfect option, but you can make it work with a little TLC.

5. Get Insurance

Most daycare centers need several types of insurance in order to keep children (and their businesses) protected. These policies typically include liability coverage, property, workers’ compensation and business insurance.

Not sure what type of insurance you need? You can always check with your local child care provider licensing office for guidance.

6. Seek Out Grants and Funding

As we covered already, there are certainly costs associated with starting a daycare. If you don’t have the money you need to cover your initial startup costs, you’ll need to get creative when it comes to acquiring funding.

There are many grants available to help you cover your startup costs. You might also consider taking out an SBA loan or doing community fundraising. Know that the goal is to use these funds as an investment that will yield profitable returns in your business.

Costs Associated with Starting a Daycare

There are several things you’ll need to buy or lease in order to get your business up and running for day one. These expenses include but are not limited to:

Renting a daycare space
Indoor and outdoor play equipment
Art supplies
Cleaning supplies
Child care supplies (like diapers and wipes)
Business laptop
Licensing fees
Food (for snacks/meals)
Bottles, cups, plates, utensils, etc.
Car or reliable transportation (optional)

You might think of some additional items you’d like to have at your daycare. Over time, you can use the revenue coming in to help cover these expenses and invest in better equipment/supplies. It’s OK to keep things simple and then scale your way up.

7. Prepare Your Daycare Center

Once you have a location secured and the proper materials and equipment in place, it’s time to prepare your daycare center.

First, clean your facility and sanitize with an effective disinfectant. Then, take the needed steps to childproof your daycare according to the ages of the children you will be caring for. Follow this childproofing checklist for help.

Finally, set up play equipment and lay out toys. You might decide to use storage boxes to keep everything organized. You can always rearrange your layout according to your needs.

Is your daycare ready for service? Give it another once-over and you’re ready to open your doors for day one of business!

8. Draft up a Contract

As a small business owner, having a contract is always a good idea. The parents that come to your facility are essentially your clients, and you want to have a solid contract in place to protect yourself from any legal issues.

We recommend seeking out a trusted contract lawyer to draft up a contract according to your needs and unique business requirements. Your contract will then be used to outline your expectations for your clients and their children.

Here are some important questions to consider when creating your contract:

How do you expect to be paid?
How will you handle late payments?
What time should parents pick up their children?
Are there consequences for late pick up?
What services will you provide?
What is your policy when it comes to sick children?
Do you offer refunds? If so, under what conditions?
What happens if a child is injured at your facility?

Whether you seek help from an attorney or write the contract yourself, you should have a contract in place before accepting business. Once signed, you can then send professional daycare invoices to get paid by your clients.

9. Establish Policies and Procedures

Establish policies and procedures for the families that attend your daycare and your staff. These procedures may include an emergency plan, safety procedures, privacy protocols and rules for your facility.

Having these procedures in place will help you keep the children safe and protect yourself from liability (in some instances). In establishing your policies, be sure to review your local child care licensing requirements to ensure compliance.

10. Research Possible Tax Credits

If you’re opening an in-home daycare, you may be eligible for certain tax reductions based on the fact that you’re using your residence for business purposes. This means you can essentially write off a portion of your housing cost. This can be the case even if your daycare space serves as a family room after hours.

11. Hire Staff as Needed

When you’re first getting started, you may just be a company of one, as you might want to save the cost of hiring unnecessary help. But over time, you may need to hire help to take care of the kids during the day.

This is especially true if you find yourself running up against the required ratio of staff to children, as outlined in your local daycare licensing requirements. Be sure to review these to make sure you have enough staff for the number of children you plan on caring for.

Also, make sure all child care staff undergo criminal background checks and provide references to ensure the safety of the children. Make your hiring decisions carefully to keep your facility safe and maintain a stellar reputation.

12. Market Your Daycare

You have your daycare set up and open for business, now how do you get families in the door? As with any small business, you’ll need to market yourself to attract potential clients.

There are many ways to market your daycare. One method is to create flyers and post them around your local community—at businesses, schools and coffee shops. You can also run paid ads on Google or Facebook to draw in families from your local area.

To establish your daycare as a professional business, consider building a website that provides more information about your services. A basic website can cost anywhere from $10 for a WordPress template and set up, to $2,000 or more for a custom design.

With a website, you can then use search engine optimization (SEO) to attract organic traffic from Google. That way, when families search for a daycare near them, your business is likely to show up in the search results.

13. Promote Your Daycare on Social Media

Another effective marketing tool for daycare centers is social media. Platforms like Facebook, Instagram and LinkedIn can be used to promote your business and draw in potential clients.

Create a business Facebook page to post more information about your daycare, collect client testimonials and keep families up-to-date with events at your daycare. You can also post on Instagram and LinkedIn, with targeted hashtags, to attract families in your area.

As your business grows, you might decide to invest in paid marketing services. A digital marketing agency or consultant can help you increase your business’s presence online, outrank your local competitors and attract new clients.

14. Provide Top-Quality Care

The success of your daycare depends on you providing top-quality care to your families. If the kids at your facility are properly cared for, and, even better, enjoy coming to your daycare, you’re likely to attract more referral business.

Positive reviews can work wonders to attract new clients. Ask families to review your business on Facebook, Google, Yelp and other review sites to improve your daycare’s reputation in your community.

Always look for ways to improve your daycare. Ask families for feedback, invest in additional education and hire fantastic staff to make your daycare the obvious choice for families in your area.

15. Manage Your Business Finances

Many small businesses fail due to poor money management. If you want your business to succeed, you’ll need at least a basic understanding of business accounting and how to manage your expenses.

Staying on top of your business finances is more than just tracking revenue in and expenses out. You’ll need to plan for taxes—typically around 30% of your revenue, after expenses—and make informed decisions when it comes to how you’re going to allocate your funds.

Professional daycare accounting software can help you send invoices, track revenue, manage expenses and more. It can even send reminders to parents for late payment and accept credit card payments with ease.

The more you know, the easier it will be to make smart financial decisions. Stay on top of your business finances so your business is not only surviving but thriving .

Congratulations on taking the first step to starting your own daycare business—reading this guide! By now you have a general blueprint for how to start your own business and get up and running.

Need more help getting started? Check out these reliable resources for aspiring daycare business owners:

Child Care Aware of America: licensing guidelines for child care and daycare providers
United States Department of Health and Human Services: childproofing checklist
Early Childhood Training and Technical Assistance System (ECTTAS): child care resource guide
Office of Child Care: list of state licensing agencies
Child Care Resources Inc.: early educator training

Starting a daycare business can be challenging but also incredibly rewarding. The process is made easier by having a general roadmap for how to get started. Hopefully, this guide has provided some guidance on how to get started, plus inspiration for you to finally launch a business of your own.

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Child Care Business Plan

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The Toddler Warehouse

Executive summary executive summary is a brief introduction to your business plan. it describes your business, the problem that it solves, your target market, and financial highlights.">, opportunity.

The education of our children needs to start earlier and earlier. The school system is failing. Those who can hire private teachers and tutors to help with their children’s education should.

The Toddler Warehouse is a full-service child care/development facility that cares for toddlers from age three to five. The Toddler Warehouse will be concentrating on the upper end of the market: double-income professional parents. These personally ambitious parents are typically eager in terms of their children’s development and will be willing to pay to have their children attend the best facilities.

The Toddler Warehouse will be offering child care/development for toddlers age three to five. The Toddler Warehouse will be targeting double income professional families who, because of work obligations, do not have the time during the day to care for their child. The Toddler Warehouse will be targeting families that are interested in something more than simple baby-sitting facilities, they would like the children to be enrolled in a program that offers development of many different skills including: socialization skills, arts and crafts, large muscle group workouts, reading, numbers, etc. Parents who are professionals, who are ambitious by nature themselves, are typically eager for their children to move ahead and are willing to pay for the best development care services for their children.

Competition

The Toddler Warehouse will be competing in the child care industry. This industry is fairly broad and populated, there are companies at all levels, from the basic baby sitter services, to competitors of The Toddler Warehouse. There are service providers that offer standard business hours as well as services that offer night and evening hours. There are scheduled services and no reservation drop off services. Price, quality, and gut feeling drives a lot of parental choices. The Toddler Warehouse believes the secret to success is to 1) concentrate on only a portion of the market, and 2) choose a portion of the market that is growing.

The Toddler Warehouse’s mission is to provide top level child care. We exist to attract and maintain customers. When we adhere to this maxim, everything else will fall into place. Our services will exceed the expectations of our customers.

Expectations

We will be profitable in the first year. By year 3 we will be able to hire more general help which focuses on care since we are all set for teachers

Financial Highlights by Year

Financing needed.

Matt will invest $85,000

Problem & Solution

Problem worth solving.

The education of our children needs to start earlier and earlier. The school system is failing. Those who can hire private teachers and tutors to help with their children’s education should.

Our Solution

Target Market

Market size & segments.

The Toddler Warehouse is targeting one specific customer group, the middle to upper class, two income professional family. This group of families have both parents working, not allowing them time to raise their child during the day. This group has the money for child care, and are willing to spend a little extra to get a higher level of care.

This customer segment has already begun teaching it’s child advanced concepts like reading, singing, socialization, etc. The Toddler Warehouse will continue to develop the children’s skills.

This customer group is typically made up of two professional parents. This would explain why the parents 1) have the money for more sophisticated child care, and 2) are ambitious in terms of their children’s learning and development.

Current Alternatives

There are many different competitors in the child care space. The Toddler Warehouse will only detail the direct, or reasonably direct competitors, and will not detail the myriad of other service providers that offer some sort of child care option. The direct competitors are:

Established, often franchised, child care centers. These are typically larger facilities that offer care to a wide range of ages. The number of children serviced is usually quite large. The child care is adequate, although somewhat impersonal by virtue of its large size.
Small, home based child care. These competitors are people that have a child care facility based out of their house. The quality of these ranges considerably, some are great, some are sub par.
Medium sized companies. These are typically independently owned facilities. Some of theses will handle a wide range of ages, others will specialize with a specific age group.

Our Advantages

The Toddler Warehouse’s competitive edge is two-fold:

Specialized training – The facility can only be as good as the teachers and assistants. With this in mind, The Toddler Warehouse has a specialized training program that all teachers and assistants are put through so they are proficient at teaching the specific programs that The Toddler Warehouse has developed for toddlers age three to five. The employees are put through an intensive week long course and only after they pass the intensive training will they be allowed to work with the children.
Innovative learning programs – Typical learning programs for toddlers this age focus on specific traits and only work on one trait/ skill at once. While this is successful in reinforcing the skill, it is often very difficult for the child to appreciate the interrelationships of the different skills. Consequently, the child can learn the skill, but has difficulty applying the skill when faced with multiple stimuli. When the child is unsure of what to do because of the multiple stimuli and these several skills that they have learned independently, the child tends to shut down out of confusion. Matt’s Master’s thesis was based on Intertwined Learning Systems that teaches skills not in isolation from each other, but taught together. Matt’s research strongly supports the assertion that when the skills are taught together, just as you would expect to encounter them in real life, the children are able to assimilate the new task into their skill set much quicker.

Keys to Success

Our keys to success are:

To create a service based operation whose primary goal is to exceed customer’s expectations.
The utilization of The Toddler Warehouse by at least 40 different families in the first eight months.
To increase the number of client’s served by 20% each year.
To develop a sustainable, profitable, start-up business.

Marketing & Sales

Marketing plan.

The Toddler Warehouse intends to concentrate on the double income working professional families because they are the segment that can most readily afford day care, are the ones who need day care because of their work obligations, appreciate the advanced learning and development The Toddler Warehouse has to offer, and lastly are a growing segment of our society.

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As America continues to be a society of people working long hours, there will always be the need for child care. The trend of longer work weeks is increasing and this drives The Toddler Warehouse’s business.

The Toddler Warehouse’s sales strategy will be targeting double income working professional families. These families have the money to spend on child care and these parents are much more likely to appreciate the advanced learning systems taught at The Toddler Warehouse based on Matt’s thesis.

The sales strategy will be based on a communication effort to explain the virtues of the program and how time at The Toddler Warehouse can speed up the children’s development considerably. In addition to one on one explanations of the program and its merits, the prospective parents will be given tours of the facilities. The tour of the facility will serve two purposes:

The tour will be used as a way to impress the prospect of the facilities that The Toddler Warehouse has. These facilities were custom designed to achieve very specific educational goals and The Toddler Warehouse is immensely proud of the facilities.
The tours typically occur during the day and this becomes a perfect opportunity for the potential customer to view the care as it is occurring. This will serve to build a trust bond between The Toddler Warehouse and the parent who naturally is cautious about leaving the child with strangers to have the child cared for and taught the entire day.

In essence, The Toddler Warehouse is letting the facilities and teacher/student interactions speak for themselves. Because of the high level of service, this is entirely possible.

Locations & Facilities

The Toddler Warehouse, soon to be located in Salem, OR, will offer child care services for kids between the ages of three and five. The Toddler Warehouse will offer services from 6 a.m. to 7 p.m. The children will be exposed to a wide range of activities including arts and crafts, socialization, large muscle group activities, and general learning. The Toddler Warehouse will be priced out of some people’s budget, but will offer a low student to teacher ratio and well trained staff. The Toddler Warehouse will be located in a recently purchased and converted home that now is solely a child care center.

Equipment & Tools

The Toddler Warehouse offers Salem an upper-end child care facility for toddlers age three to five. The Toddler Warehouse offers a low teacher to student ratio, custom facilities, and innovative learning programs. The Toddler Warehouse hours will be a bit wider rage than normal business hours to accommodate the working parents, the target customer.

The two income families have children, yet both parents work. The Toddler Warehouse is an innovative solution that acts as virtual parents, broadening the children’s skills during the day. This is not a baby sitter facility. The children are engaged throughout the day, learning new skills and reinforcing already acquired ones.

Milestones & Metrics

Milestones table, key metrics.

Key metrics are:

The # of families paying fees to breakeven
increase the # families paying fees by 20% year over year
training teachers and assistants
keep on top of the educational tools

Ownership & Structure

The Toddler Warehouse will be an Oregon Corporation, founded and owned by Matt Ernal.

Management Team

Matt Ernal, the founder and owner of The Toddler Warehouse will be running the daily operations. Matt got his undergraduate degree in English from the University of Oregon. Upon graduation, Matt was unsure of what he wanted to do so he travelled to Indonesia and taught English for three years. For the first year, Matt lived with a local family. In exchange for room and board, Matt cared for the family’s two children. Although he had never done any child care before, Matt found this very satisfying.

Upon returning to the US, Matt was contemplating pursuing something with teaching. His experience in Indonesia was quite positive, both the English classes and caring for the young children. Ultimately, it was the experience with the young children that led Matt to consider a career teaching young children. Matt entered Western Oregon University’s nationally recognized Master of Education Program to pursue toddler development. After graduation, Matt was confident of his abilities and decided that he would appreciate the autonomy of running his own business. He purchased a house for the facility has been working hard on this project ever since

Personnel Table

Financial plan investor-ready personnel plan .">, key assumptions.

Our key assumptions:

Kids need to have a place that caters to the way they learn
Kids need somewhere that teaches them life skills
Education starts at a very young age
Parents need somewhere safe and nurturing to leave children while they finish their workday.

Revenue by Month

Expenses by month, net profit (or loss) by year, use of funds.

The Toddler Warehouse’s start-up costs include:

Legal: $1,000
Stationery etc: $100
Brochures: $350
Art supplies: $150
Kitchen supplies: $200
Cleaning supplies: $100
Medicine kits: $100
Matts and pillows: $150

Total $ 2150

Sources of Funds

Our founder will invest $85,000 to get the operation up and running.

Projected Profit & Loss

Projected balance sheet, projected cash flow statement.

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How to write a business plan for your daycare center.

A daycare center is a great way to provide childcare services to families who need it.

It can also be a great source of income for those who run it.

But, before launching anything, make sure you have a business plan in place.

A business plan is essential to ensure the success of any new project, such as a daycare center. It helps to identify goals, resources, and strategies for achieving them.

In short, a good business plan will help ensure the profitability of your daycare center .

What are the necessary elements for a business plan for a daycare center? How do you define the structure? Which performance indicators should be included in the financials? How can I develop an efficient business plan in less time?

Prepare yourself for a satisfying read, as all your questions will find answers in this article!

One last thing, you don't have to start your business plan from scratch.

Instead, you can download our editable business plan for a daycare center and customize it to fit your needs.

How to craft a business plan for a daycare center

Is it necessary to create a business plan for your daycare center.

Yes, you should create a business plan for your daycare center to help ensure its success.

Designing a cohesive business plan will equip you to:

gain knowledge of the daycare center market
stay current with consumer trends and infuse them into your project
uncover profitability factors for a daycare center
understand the childcare needs, educational programs, and safety requirements for children
create a solid value proposition for your child care facility
review competitor customer satisfaction
find competitive advantages for your daycare center
find a business model that will result in financial success
implement a winning strategy on the short and the long-term
evaluate risks associated with operating a daycare center, including child safety, staff training, and adherence to licensing regulations

Our team has drafted a business plan for a daycare center that is designed to make it easier for you to achieve all the elements listed.

How to organize a business plan for a daycare center?

Inside a business plan, you'll find various facts, numbers, and indicators. It should be arranged in a way that makes it simple to read and comprehend.

When we elaborated our business plan for a daycare center , we made sure it had a proper structure.

The content is split into 5 sections (Opportunity, Project, Market Research, Strategy and Finances).

1. Market Opportunity

The section number one is designated as "Market Opportunity."

Discover important data and figures about the daycare center industry in this section, helping you navigate this competitive market and cater to childcare needs and preferences.

The data here is always up to date; we update it biannually.

2. Project Presentation

The "Project" section provides an opportunity to describe your daycare center, outlining the age groups you cater to, educational programs, facilities, safety protocols, qualified staff, daily activities, and the unique value proposition that offers a nurturing and enriching environment for children.

Remember to introduce yourself at the end of this section.

Discuss your passion for childcare and early education, your safe and nurturing environment, and how you plan to provide exceptional daycare services. Highlight your qualified staff, your age-appropriate curriculum, and your dedication to fostering the cognitive, social, and emotional development of children through engaging activities and personalized care at your daycare center.

Our business plan has text for you. Customize it to fit your concept.

3. Market Research

After that, comes the "Market Research" section.

In this section, you will find a detailed market segmentation analysis for your daycare center.

It includes a presentation of other daycare centers in the area that will be competing with you. Your center's competitive advantages are also highlighted. A customized SWOT analysis is included.

4. Strategy

The "Strategy" section outlines a comprehensive 3-year action plan, detailing the initiatives and steps needed to transform your daycare center into a highly profitable endeavor.

Furthermore, you'll discover a marketing strategy, risk management method, and the Business Model Canvas.

5. Finances

Ultimately, the "Finances" section is where you can outline the financial plan and estimations for your project.

How to elaborate an Executive Summary for a daycare center?

The Executive Summary presents a compact overview of the business plan of your daycare center.

Make it concise and not more than 2 pages, highlighting only the essential facts.

When you give your business plan to a bank, this is the part they will read first. It needs to grab their attention and make them want to read the rest of the plan.

In the Executive Summary of your daycare center, answer the following questions: what services does your daycare center offer? who is your target audience? are there other daycare centers in the area? what funding do you require?

How to do the market analysis for a daycare center?

Conducting a market study for your daycare center enables you to grasp external factors like parent demands for childcare services, competition within the daycare industry, and emerging trends in early childhood education.

By conducting a comprehensive market analysis, a daycare center can understand the needs of parents and children, provide a safe and nurturing environment, optimize pricing strategies, and execute targeted marketing campaigns, ultimately leading to a loyal customer base, increased enrollment, and a prominent position in the local childcare industry.

Here is what you will find in the "Market Research" section of our business plan for a daycare center :

important statistics and figures related to the daycare industry, such as enrollment rates, average childcare costs, and safety standards
a list of potential audiences for a daycare center
the competitive analysis
the competitive advantages to build for a daycare center

The key points of the business plan for a daycare center

What's the business model of a daycare center, business model of a daycare center.

A daycare center's business model revolves around providing childcare services for infants, toddlers, and young children. Revenue is generated through enrollment fees, monthly tuition, or hourly rates.

The business model focuses on creating a safe and nurturing environment, hiring qualified staff, designing age-appropriate educational programs, maintaining regulatory compliance, building trust with parents, and offering additional services such as meals or after-school programs.

Success in the industry depends on building a reputation for quality care, securing necessary licenses and certifications, effective marketing to target families, and providing a positive and stimulating experience for children in the center's care.

Business model ≠ Business plan

Do not confuse the terms 'business plan' and 'business model'.

A business model defines how a company creates, delivers, and monetizes its offerings.

In a business plan, you outline your business model using a tool called the Business Model Canvas.

And, of course, there is a Business Model Canvas (already completed) in our business plan for a daycare center .

How do you identify the market segments of a daycare center?

Segmenting the market for your daycare center involves dividing your potential customers into different groups based on their childcare needs, age groups, and working parents.

These categories may include factors such as infant care, toddler care, preschool programs, or parents seeking part-time or full-time daycare services.

By segmenting your market, you can offer a range of daycare programs and facilities that cater to each segment's specific requirements. For example, you might provide specialized infant care programs with a low caregiver-to-child ratio, offer structured learning and play activities for toddlers, create pre-school programs that focus on early childhood education, or offer flexible scheduling options for parents seeking part-time daycare services.

Market segmentation allows you to effectively target your marketing efforts, provide a nurturing and safe environment for children, and build trust with parents by offering tailored daycare solutions that meet the unique needs of each customer segment.

In the business plan for a daycare center , you will find a comprehensive market segmentation that will help you better understand your potential customers.

How to conduct a competitor analysis for a daycare center?

Without surprise, you won't be the only daycare center in your region. There will be other centers offering child care services to parents and guardians.

A successful business plan requires a detailed study of the market and an analysis of your competitors' strengths and weaknesses.

Address their weaknesses (such as high staff turnover, inadequate child supervision, or poor parent communication).

Why should you pay attention to these points? Because these weaknesses can impact the success of daycare centers. By addressing these aspects, you can offer a safe and nurturing environment for children, provide engaging and educational activities, and deliver personalized care and attention, positioning your daycare center as a trusted and preferred choice for parents seeking quality childcare and early childhood development.

It's what we call competitive advantages—cultivate them to set your business apart.

Here are some examples of competitive advantages for a kindergarten: qualified and nurturing teaching staff, stimulating educational activities, safe learning environment.

How to draft a SWOT analysis for a kindergarten?

A SWOT analysis is useful for starting a daycare center as it can help identify strengths, weaknesses, opportunities, and threats which can be used to create a successful business plan.

As you can guess, there is indeed a completed and editable SWOT matrix in our business plan for a daycare center

The strengths for a daycare center

When we use the "S" in SWOT, we're talking about Strengths, which are the project's internal assets or areas of expertise.

For a daycare center, possible strengths could include experienced staff, a safe and clean environment, a variety of activities, and a positive learning atmosphere.

The weaknesses for a daycare center

W stands for Weaknesses, which are the areas or aspects of the project where improvements are necessary.

For a daycare center, potential weaknesses could include inadequate staffing, lack of proper training, inadequate security measures, and poor communication with parents.

The opportunities for a daycare center

O stands for Opportunities in SWOT, representing the external factors or circumstances that can create opportunities for the project.

In the case of a daycare center, potential opportunities could include offering after-school programs, summer camps, weekend activities, and parent-child classes.

The threats for a daycare center

The "T" in SWOT represents Threats, indicating the potential negative factors or risks from the external environment.

How to develop a marketing plan for a kindergarten?

A marketing strategy is an essential building block of a business plan as it outlines how a business will capture customers and achieve revenue targets.

A daycare center can connect with parents in search of a nurturing and educational environment for their children by developing an effective marketing plan that emphasizes the center's experienced staff, engaging activities, and safe facilities.

Parents won't choose your kindergarten without proper promotion; showcasing your nurturing environment, qualified teachers, and educational approach is necessary.

Have you explored marketing approaches to attract parents to your daycare center? Consider offering educational programs or special activities for children, partnering with local parenting groups or community organizations, and utilizing targeted advertising campaigns in family-oriented publications or online platforms.

No worries if you have no knowledge of marketing and communication.

How to build a solid financial plan for a kindergarten?

A successful business plan requires comprehensive financial data in order to accurately forecast future performance.

Obviously, you should estimate the projected revenue for your daycare center.

It's important to include revenue projections in your business plan that potential investors can trust because they are built on realistic and strong assumptions.

Our financial plan for a daycare center is easy to use and includes built-in checks to help you identify and correct any assumptions, ensuring you create reliable projections with confidence.

Of course, you will need to create a preliminary budget for your daycare center . Don't forget any expense (we have listed them all in our financial plan !).

The break-even analysis is an essential component of your financial plan, as it provides an indication of whether your daycare center will be profitable or not.

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Daycare Business Plan Template

Download our template and create a business plan for your daycare!

Updated September 22, 2023 Reviewed by Brooke Davis

When you are ready to start a daycare business, you need an effective plan outlining how to get there. High-quality child care is in high demand, but you must be prepared for the challenges of starting a new business.

A solid business plan will get you off on the right foot before you even open the doors of your new facility.

With these helpful tips, you can learn how to make a business plan for a daycare center. Whether you are looking to watch over young children or even need a dog daycare business plan, Legal Templates is here to help you get started.

Why You Need a Business Plan for Your Daycare Business

How to write a business plan for a daycare.

Management Team

Daycare Business Plan Sample

A business plan sets the stage for how you will operate your business and how you will get it running. A daycare is no different. Opening a daycare requires intensive planning, legal compliance, and understanding of your market.

A daycare business plan template walks you through the steps to build a proper path forward. Every successful business is planned correctly, not as you go along.

A sample daycare business plan pdf or Word document lays it out for you. You can learn how to put it together and what you must include. Many business plans help you understand what you must do to prepare.

Some are designed to recruit potential investors to your cause. Either way, you need a business plan to prepare you for the challenges and successes ahead.

Knowing how to write your daycare business plan can be tricky without some help. You may not have done this before, but a daycare business plan example can help.

Follow these writing tips in each section to create a strong business plan for your future daycare.

1. Executive Summary

The initial section of your business plan is the executive summary. This part of your plan is an introduction for whoever reads it. It is designed to offer an overview of the remaining sections. It should be concise and add only summary details—this is not the section for intensive information or data.

The executive summary will highlight what your daycare business will look like and the most crucial section of your entire plan.

This section may provide information such as:

A business address
Phone number, email address, and other contact information
List of owners
Banking information
Start date for the daycare
Client base
Market niche
Factors for success

The executive summary lets you make a case for why your particular daycare will be successful and competitive. It is also the section that helps you sell yourself and your business to potential investors who may play a critical role in starting your daycare.

Provide a mission statement that reflects your goals for the daycare and your motivation for starting your business.

2. Management Team

Your daycare business plan should include important information about your management team. The first part of this section may address ownership of the business itself. It should outline all essential ownership details, such as:

Legal names of every owner
Each owner’s proportionate share
The format of ownership percentage (i.e., stocks, capital investments, etc.)
The format of the business (Corporation, LLC, etc.)
Contact information for each owner

You want everyone who reads this business plan to know who has a stake and how their interests are represented. These details are a crucial part of business formation and preventing costly legal disputes in the future.

The management team section should also include the profiles of your management staff. These people will run the business daily, and they should be properly vetted before being put in charge.

Your business plan should list the management teams’:

Names and positions
Summary of responsibilities
Credentials and education background
Prior employment or experience
Early childhood education licensing or other credentialing
Management experience
Salary and benefits
Past success in a similar role

This information should demonstrate why these are the right people for the job. Not only does it help you know how your business will run, but it also shows others you have a proper plan in place for your daycare.

3. Products and Services

This section lets you talk about why you are starting this business in the first place. You will outline the services or products you intend to sell to consumers. For a daycare, it should outline the following:

Who is being cared for: Children, elderly adults, or pets?
Business hours
Staff costs and required credentials
Will you offer food, diapers, and other child-care products?
How will you measure sales metrics

Daycare is typically considered a service, but product sales are also often a part of this model. Your plan should adequately account for how you will handle this dual purpose and how it fits into your business model.

4. Customers and Marketing

You must identify your market and how you will get customers into your daycare. This section will focus on your area’s need for daycare services and the types of customers you expect to get.

Identification of customers is a vital part of a business plan and should include details like:

How many parents need childcare services?
What costs can families be expected to pay for your services
The community you will target
Demographic data for potential customers

With your customers in mind, you can focus on your marketing strategies. You want to differentiate yourself from competitors and ensure the community knows your new business. The daycare business plan must outline how you will achieve these goals.

A marketing strategy should combine both traditional and digital marketing methods, including:

Open houses
Word-of-mouth advertising
Advertisements in the paper or yellow pages
Billboards or other ads
Television, radio, or internet advertisements
Social media pages

5. SWOT Analysis

A SWOT analysis will address your daycare’s strengths, weaknesses, opportunities, and potential threats. This analytical method examines your company and how it will operate.

It puts each of the four metrics into a visual matrix to help prospective business owners quickly identify favorable and unfavorable factors that may affect their business venture.

A SWOT analysis should focus on how your daycare services can perform against competitors. It may address factors like:

Any threats the daycare may face
Competitive advantages and why they would be successful
Areas that may be improved over time
Technology or resources the company may use to increase efficiency
Internal factors that may affect economic success

Detailed SWOT sections show investors you have done your homework and give you valuable data to make informed business choices.

6. Financials

A business plan should address the unique financial situation you face. Your daycare business plan should demonstrate your break-even amounts and expected profit margins.

It will also address the costs and the areas of revenue you expect. You will want to address the following:

Enrollment fees
Payment plans
Cost of supplies and materials
Employee costs
Regulatory costs
Additional program offerings and revenue
Necessary loans or capital improvements

A well-developed budget can demonstrate expected cash flows versus expected expenditures. Knowing how to handle these costs will be incredibly helpful in starting your daycare.

7. Operations

Your operational plan should outline specific procedures your business and staff will follow. It will list employees and those in management positions and their responsibilities.

As in your management section, a detailed “chain of command” is essential. Staff are an important part of your operations and should be detailed here.

One of the most important aspects of a daycare operation is its location. It would be best if you addressed the following:

The facility’s address
The type of area it is in (residential, commercial)
The space available and amenities
Why is it a prime location
Accessibility to the community for drop-off

You should also list your business hours and the services you will have available at different times. Child daycare centers differ in when they offer care—whether during the day, evenings, or even on weekends.

If you are doing other forms of daycare, you may even utilize late or overnight hours. You can decide how you run your business, but operations should be clearly outlined in your business plan.

8. Appendix

The appendix section allows you to include other documents that add to your business plan. They may include legal documents like licensing credentials, insurance information, and business formation documents.

Additional documents in this area are meant to support your business plan. The appendix might also include the following:

Reference letters
Photographs of the facility, locations, or general area
Market research data
Compliance Requirements

The appendix is a flexible section that lets you add supporting documents and other relevant information. Only add details that are helpful to your business plan. The appendix does not need to be lengthy or filled with fluff.

Legal Templates has the daycare business plan sample you need to construct your plan. With this sample at your disposal, you can formulate a business plan for your daycare to show to investors or for your purposes.

You may also use a business plan builder template to help you construct your daycare business plan step by step. See the sample below to help you get started.

Lease Agreement
Power of Attorney
Non-Disclosure Agreement
Eviction Notice
Legal Resources
Partner With Us
Terms of Use
Privacy Policy
Do Not Sell My Personal Information

The document above is a sample. Please note that the language you see here may change depending on your answers to the document questionnaire.

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How to Write a Business Plan for Starting a Day Care Center

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Writing a business plan for starting a day care center will serve a few different purposes. First, a business plan may help you organize your ideas for launching your business by identifying the steps you need for business start-up. A day care center business plan will also help you stay on track after you've launched your business and as you move toward meeting your goals. A business plan isn't necessarily set in stone, however, and you can adjust it periodically as your business grows or your plans change.

In addition, a business plan demonstrates you have carefully thought through the operations of your daycare business; it can be used to show lenders why they should help you finance your business.

Create Your Company Description

Create a general overview of your day care business plans. Write a brief summary of your goals and include why you think starting a day care business is a good idea. Include a description of your own experience and qualifications as well as your expectations for staff.

Provide A Market Analysis

Include an analysis of the day care center industry. List information about day care industry tends and estimate day care industry revenue. Include information about the needs of your target market and how its day care needs are currently being addressed. Include information about how you will position your day care center business for success despite the competition.

Detail Your Marketing Plan

Include details about plans for pricing and advertising your business. Plan how you will communicate your day care business' benefits to your target market.

Outline Your Organization and Management

Describe the legal structure you will choose for your business. For example, if you will be the sole owner of the day care center, you may start a sole proprietorship. If you will have a partner, however, you will have to form a partnership. You may even choose to establish your business as a separate entity from yourself by forming a corporation.

Add information about managing your business. Include details about hiring and training employees. Make sure to cover the legal necessities of a daycare business, such as site safety, emergency care, staff qualifications, and other requirements in your area.

Lay Out Your Finances

Your plan should include a statement of how the business will run financially. That is, what you anticipate as your start-up and operational costs and the type of income you anticipate from the daycare's clients or from other sources of funding such as grants, donations or community assistance.

Make Your Funding Request

Determine what you will need in terms of financial assistance to get your business off the ground. Include a description of the location you've chosen for your day care center, and the equipment and furnishings you will need.

Lenders will want to review your day care business plan if you apply for a loan. Use your business plan to demonstrate how your business will stand out among your competitors, why you should run it and why now is the right time to start a day care center.

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Lenders may review your day care business plan if you apply for a loan. Use your business plan to demonstrate how your business will stand out among your competitors, why you should run it and why now is the right time to start a day care center.

Jordan Meyers has been a writer for 13 years, specializing in businesses, educational and health topics. Meyers holds a Bachelor of Science in biology from the University of Maryland and once survived writing 500 health product descriptions in just 24 hours.

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Raising Tomorrow: The Strategic Business Plan for Your Daycare Center

Daycare centers play an important role in providing working parents with a safe and caring environment for their children in today’s fast-paced society. However, to ensure viability and long-term sustainability, the construction and operation of a daycare facility require meticulous planning. One of the most effective ways to achieve this aim is to create a comprehensive business plan that includes a variety of key features.

The most useful approach for establishing a daycare center’s viability and sustainability is to develop a business plan encompassing market research, facility setup, staffing, safety measures, curriculum, pricing, marketing, finances, and compliance.

This article digs into the fundamental components of a thorough business plan for opening a daycare facility, emphasizing how this strategic document lays the road for a thriving and sustainable childcare operation.

Table of Contents

Market Research: A Foundation for Growth

Market research is the essential cornerstone for the growth of any entrepreneurial effort, and this notion applies even to daycare centers. In this setting, a thoroughly developed business plan is critical for unraveling a tapestry of insights necessary for appreciating the local desire for childcare services. This undertaking entails a complex investigation, diving into aspects such as determining the key target demographics, analyzing the subtle contours of the competitive landscape, and decoding the demand and supply dynamics.

Operators can acquire priceless insights regarding the optimal geographical nexus for the center through a complicated process of meticulous investigation, thereby enhancing accessibility and convenience for parents. This empirical approach reveals the specific programmatic features that hold the possibility of increased appeal, guaranteeing that the center’s offers are meticulously matched to the local populace’s goals. This analytical journey also results in the identification of pricing paradigms that resonate with potential customers.

Facility Setup: Creating a Safe and Stimulating Environment

The physical environment of a daycare facility has a significant impact on the overall encounter of not only the children but also the parents involved. A rigorous delineation of the facility’s architecture and design gains critical significance within the outlines of the business strategy, working as the channel via which safety benchmarks, hygiene protocols, and age-tailored facilities effortlessly interlace. The orchestration of spaces that cater to diverse requisites, including realms of play, learning, and relaxation, which serve as foundations for supporting the comprehensive evolution of young minds, is fundamental to this orchestration.

The construction of a safe and exciting atmosphere that encourages exploration while guaranteeing parents their children’s well-being beckons. The parameters of safety and cleanliness are meticulously integrated into the architectural fabric, allowing for unbroken interaction and development.

The thoughtful incorporation of eco-conscious methods strengthens the center’s resonance with contemporary paradigms of responsible entrepreneurship. The use of sustainable materials not only demonstrates a deep dedication to environmental protection but also recognizes the symbiotic relationship between corporate operations and the world at large. By implementing eco-friendly ways, the daycare center not only pioneers conscientious methodologies but also sets a standard for future-conscious interactions, all while nurturing the young brains entrusted to its care.

Staffing: Nurturing with Competence and Care

Raising Tomorrow: The Strategic Business Plan for Your Daycare Center

A daycare center’s spirit is found in the mosaic of its workers. The recruitment and retention of skilled and compassionate caregivers are critical components in creating a nurturing environment. A thorough exposition of the recruitment trip unfolds within the framework of the company strategy, an expedition precisely planned to describe the contours of staff-to-child ratios, immersion training regimens, and strategies for cultivating long-lasting staff ties.

This fabric of care is intricately woven with threads of understanding child psychology, expertly navigating the maze of health and safety rules, and refining the art of nuanced communication with both the patients and their families. This specific knowledge pervades the daycare center’s culture, leaving an enduring stamp on its reputation and trajectory.

By outlining the recruitment process, which includes stringent selection criteria and extensive background checks, the center not only protects the children under its care but also strengthens its reputation in the community as a pillar of trust. Equally important is the calibration of staff-to-child ratios, which ensures an ideal mix of supervision and individualized attention, which is an essential component in the nurturing equation.

The implementation of thorough training programs, with a focus on child-centric psychology and health procedures, strengthens the staff’s ability to provide excellent care. Retention initiatives, which are acknowledged in the business plan, weave a tapestry of supportive measures to keep staff engaged and dedicated, providing an environment in which caregivers grow as important pillars of the center’s continued growth.

Read more about The Childcare Advantage: Online Training Courses for Skill Enhancement

Safety Measures: Prioritizing Child Well-Being

Child safety is an unchanging cornerstone of daycare centers, a value written in stone. A well-crafted business plan should go beyond the surface, weaving an elaborate tapestry of complete safety standards, perceptive emergency response plans, precise health and sanitation regimens, and a meticulous blueprint for routine facility care. This orchestration of safeguarding goes beyond pragmatism and into the domain of trust-building, an intangible assurance to parents that their treasured children are nestled inside the arms of capable care.

Enveloping youngsters in a cocoon of protection demands a collection of factors ranging from the complexities of immaculate hygiene to the complexities of foresight through emergency reaction preparations. By incorporating these precautions into the business plan, the daycare center sends a strong message to concerned parents. This trust-building process, aided by stringent safety measures, serves as a lynchpin in the center’s reputation and long-term viability.

The elements of security extend beyond the physical environment. Background checks for staff members raise the bar of trust, ensuring that the caregivers’ values coincide with the center’s unshakable dedication to children’s well-being. Procedures that govern entrance to the institution reverberate as a vital aspect of this orchestration, establishing virtual sentinels to protect the facility’s young occupants.

Curriculum: Fostering Holistic Development

The scaffolding of a properly crafted curriculum is critical in creating a daycare center’s legitimacy and efficacy. This fundamental feature resonates not only within the educational sanctuary but also throughout the heart of the business plan, demonstrating the center’s commitment to holistic development. The contours of the educational method are masterfully etched inside this strategic plan, intertwining flawlessly with elucidations of learning objectives and a plethora of age-appropriate activities positioned to energize cognitive, physical, social, and emotional growth.

The pedagogical orchestration’s symphony comes to life via the delineation of meticulously planned activities, each thread is woven to stimulate a specific component of a child’s multidimensional journey toward maturity. The activities are infused with an eclectic mix of art, music, language, and outdoor play, with each hue contributing to a rich tapestry that nurtures young minds at every stage.

This curriculum’s fabric goes beyond basic learning; it serves as the framework for championing children’s developmental milestones. The commitment to a well-rounded educational experience becomes an anthem as the business plan grows, resonating with parents and echoing the daycare center’s mission to nurturing not only information but the flowering of well-rounded individuals.

Pricing Strategies: Balancing Affordability and Quality

Navigating the maze of price structures is a delicate ballet, a choreography that balances the need for quality services with the requirement of parent affordability. This sophisticated dance unfolds as a symphony of transparency and strategic consideration within the area of business strategy. The essential point is the thorough presentation of pricing levels, a strategic mosaic that beautifully balances quality and economic accessibility.

The demarcation of many payment plans, each organized to resonate with the varying requirements and preferences of parents, enriches the narrative of the business plan. Potential discounts, carefully stated in the strategy, add a harmonious cadence to this pricing symphony, presenting pathways that recognize not only economic considerations but also loyalty and referrals.

Transparent pricing, as illuminated in the story of the business plan, becomes the prism through which parents see the tangible value inherent within the services delivered. This transparency grows into a foundation of trust, on which parents may be confident of the center’s unwavering dedication to their child’s overall well-being and developmental journey.

Read more about The Daycare Entrepreneur’s Playbook: Starting Strong and Sustaining Growth

Marketing Efforts: Building a Strong Presence

Creating an effective marketing symphony is an essential prelude to luring parents into the embrace of a daycare provider. A wise company plan orchestrates a musical medley of techniques that cross the boundaries of online and offline realms, resonating with the echoes of branding, a captivating social media cadence, and harmonious connections with local institutions and schools.

This strategic dance shines through in the company plan’s blueprint, as the story pulsates with the demarcation of marketing techniques that transcend the limitations of physical presence. Online platforms are expertly manipulated, resonating as portals that draw parents from the digital domain into the core of the center’s offerings. At the same time, the alchemy of offline channels intertwines with the harmony, throwing a broader net that snags individuals who thrive on real contacts.

The center’s unique signature emerges as branding, a tapestry woven with the threads of its ethos, principles, and mission. A deftly cultivated social media presence resonates as a digital hearth where the warmth of the center’s care spreads beyond its boundaries. Collaborations with local businesses and schools, as represented in the business plan’s narrative, create a link that benefits the community and strengthens the center’s presence.

This rigorous planning culminates in the development of a positive reputation, an intangible gem fostered inside the community. Word-of-mouth recommendations, carried by delighted parents, emerge as a potent emissary, capable of sweeping through the childcare sector with resonant impact.

Financial Planning: Securing Long-Term Viability

The complicated dance of effective financial planning serves as the foundation for a daycare center’s long-term viability. This dance emerges as a strategic narrative within the pages of the business plan, interweaving the strands of comprehensive financial forecasts that cover the spectrum from inception to fruition. The prelude includes startup costs in this symphony, the conductor conducts the orchestra of operational expenses, revenue predictions sing their lovely songs, and the painful harmony of break-even analysis paints the canvas of fiscal viability.

This collection of financial projections transcends numbers; it serves as a beacon guiding the center through the maze of fiscal maneuvering. These predictions, which are outlined in the business plan, have a dual purpose: they illuminate the way to acquiring the critical first money required for launch, and they serve as a compass that leads the ship of cash flow management to safer financial shores.

Informed decisions, bolstered by these projections, bloom as prudence’s petals. The center’s profitability and long-term viability thrive within its embrace. This precisely crafted business plan is more than just a document; it is a lifeline that intertwines strategy, foresight, and practicality, ensuring the center’s durability and fostering its ascension.

Regulatory Compliance: Navigating Legal Frameworks

A symphony of operation resonates musically with a critical chorus of rules aimed to guarantee children’s safety and well-being within the sphere of daycare centers. The business strategy serves as the libretto, carefully detailing the center’s overture to comply with this regulatory orchestration. The choreography of compliance with licensing, health, and safety regulations, organized by local and national authorities, is exquisitely revealed inside its pages.

This adherence narrative becomes more than a regulatory checklist; it is a proclamation of commitment to the highest levels of childcare. License requirements are regarded as badges of pride, confirming the center’s dedication to operating within the bounds of legal and ethical norms. Health and safety requirements are more than just regulations; they are the basic foundations upon which the sanctuary of child development and nurturing is built.

The narrative of the business plan morphs into a beacon of credibility as it meanders through the complexities of compliance. Its pages resound with a symphony of responsibility, eliciting trust from parents who leave their most precious beings to the care of the center. The greater community views the center as a model of dedication, an oasis where strict adherence to standards fosters an environment of trust and dependability.

Frequently Asked Questions

What is the importance of market research in a daycare center business plan?

Market research assists daycare center operators in understanding local childcare demand, identifying their target audience, and assessing the competitive landscape. This data-driven approach drives decisions about location, program offerings, and pricing, ensuring that the center’s long-term performance is aligned with community needs.

How does a broad curriculum improve the viability and sustainability of a daycare center?

A well-structured curriculum promotes holistic child development, which attracts parents looking for quality education and care. It outlines age-appropriate activities that promote cognitive, physical, social, and emotional development, distinguishing and increasing the center’s reputation. A strong curriculum displays the center’s dedication to the learning and well-being of children.

How can a business plan for a daycare center ensure regulatory compliance?

Regulatory compliance is critical for the legal and ethical operations of a daycare center. A thorough business strategy should include measures for adhering to licensing, health, and safety regulations imposed by local and national authorities. Compliance commitment not only protects the center’s legality but also creates trust between parents and the community.

To learn more on how to start your own daycare checkout my startup documents here.

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Meet Shawn Chun: Entrepreneur and Childcare Business Fan.

I’m a happy individual who happens to be an entrepreneur. I have owned several types of businesses in my life from a coffee shop to an import and export business to an online review business plus a few more and now I create online daycare business resources for those interested in starting new ventures. It’s demanding work but I love it. I do it for those passionate about their business and their goals. That’s why when I meet a childcare business owner, I see myself. I know how hard the struggle is to retain clients, find good employees and keep the business growing all while trying to stay competitive.

That’s why I created Daycare Business Boss: I want to help childcare business owners like you build a thriving business that brings you endless joy and supports your ideal lifestyle.

Capabilities

How to write a business plan for your daycare center.

Here we have put together a list of key elements to help write a successful business plan for your daycare center.

Do Your Research

The first step to developing a business plan for your daycare center is to do your research. Look at what your competitors are doing – think about what makes them successful and/or their pitfalls.

Do they have a unique mission statement? Does their staff follow a specific teaching philosophy? Realizing other daycares’ competitive advantages will help you identify any gaps that these centers are not filling.

You’ll also want to research the demographics of your area. What does a typical family in your area look like? In some areas it’s typical for both parents to work, but in others it’s not. You may also want to look into things like education level, religion, income level, how many children are in a typical family, as well as grandparent involvement and common values .

Will the values and interests of your daycare center be appealing to the families that surround it? Research is a huge part of creating a daycare business , and it’s something you’ll want to be thorough with before fully diving in.

Develop a Mission Statement

When you think about what you aspire your daycare to be, a lot of things likely come to mind. You have big dreams after all! However, it is important to start with the basics and develop a mission statement.

This should be a relatively simple vision you have for your center that can be shared on marketing collateral and is appealing to prospective parents. Whether it’s a focus on early childhood development or a particular teaching philosophy you believe in, you’ll want to present your mission statement boldly and confidently.

Once you develop a mission statement, it’s time to think about your other goals and objectives. But, what’s the difference between goals and objectives?

Goals are something that is measurable – whether it’s a certain enrollment number or how much revenue you bring in after year one.
Objectives are a little less numerical – they can be the values you hope to instill into your center like teaching children life sills like effective communication, how to share, and creating a nurturing environment.

Creating a clear mission statement and supporting goals and objectives is key to setting yourself up for success. Whenever you feel overwhelmed or unsure of the direction of your daycare center, check back in with your mission statement, goals and objectives to ground yourself

Look at Your Financials

Financials may not be the most fun part of starting a daycare business, but they are certainly important. While you may have the passion and expertise needed to fuel a new business, without the right financial standing, it’s hard to turn your dreams into a reality.

A common question you may ask yourself is, “How much does it cost to start a daycare?” While the number will certainly vary wildly depending on the area you live in and whether you are acquiring an already owned building or starting from scratch, experts say it will cost you anywhere from $10,000 to $50,000. Think about whether it’s realistic to start your daycare now or continue saving up until you’re ready – it’s a big investment!

For those who are just starting out and may not have that much financial experience, daycare software can be a huge help. It helps simplify paying your bills, easily track expenses, and handle budgeting – all from a single platform.

Use daycare software to maintain a record of your expense categories like classroom supplies, maintenance, utilities, and rent, and ensure that nothing gets lost and you’re always on budget. One expense gone wrong can have a huge impact on a new business, so keeping your data and information all in one place is highly recommended.

Develop Policies & Procedures

A successful business plan needs information about the daycare center’s policies and procedures. Policies and procedures are the foundation of a new business, and they are something you’ll want parents to have a firm understanding of.

To start with, think about developing a payment policy . This will entail things like how to handle late payments, billing schedules, and more.

It’s also important to take note of any licensing requirements for staff ratios and teachers’ educational backgrounds. Child care staff are subject to fingerprinting and background checks, so be sure to verify references and education levels.

Learn About Insurance

Insurance is a requirement for opening a licensed child care facility, and having it is essential for protecting both your business and your personal assets. While understanding insurance may not come naturally to everyone, there are a lot of resources on the internet and professionals willing to help.

Talk with a licensed insurance agent who’s familiar with local requirements to review your needs and recommend coverage terms and policies. And, if you plan on offering healthcare benefits to your employees, you’ll want to meet with a healthcare provider who can help with developing a plan.

Create a Marketing Plan

Here comes the fun part. What’s going to make your daycare center stand out among the competition? How are you going to get your name out into the community?

Start by deciding how you’ll raise awareness among potential customers. Maybe it’s participating in family-friendly community events in the area or listing your school in a local directory. You can even think about running a social media campaign to build awareness and reach new parents.

And as far as differentiating yourself from other daycares, consider implementing Procare’s all-in-one daycare solution designed to help manage your daycare and stay connected with parents.

For modern parents who are on the go, joining a daycare with a tech-savvy management system in place can be incredibly appealing. With the ability to make payments online , digitally check in/check out, and read about updates on their child throughout the day, this kind of software will definitely give you a leg up.

Final Thoughts

Creating a business plan for your daycare center is a lot of hard work, but it can also be exciting. You are at the beginning stage of making your dreams a reality and by organizing your ideas, policies, marketing plans, and more in a logical document, you are setting yourself up for success – and for a lot of future happy parents and children.

Ready for next steps? Learn more about how to successfully start a daycare .

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Written by Dave Lavinsky

Senior / Adult Day Care Center Business Plan Template

Over the past 20+ years, we have helped over 1,000 entrepreneurs and business owners create business plans to start and grow their adult day care businesses. On this page, we will first give you some background information with regards to the importance of business planning. We will then go through a senior day care business plan template step-by-step so you can create your plan today.

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What Is a Business Plan?

A business plan provides a snapshot of your adult daycare business as it stands today, and lays out your growth plan for the next five years. It explains your business goals and your strategy for reaching them. It also includes market research to support your plans.

Why You Need a Business Plan

If you’re looking to start an elderly day care business or grow your existing elderly day care business, you need a business plan. A business plan will help you raise funding, if needed, and plan out the growth of your adult daycare business in order to improve your chances of success. Your business plan is a living document that should be updated annually as your company grows and changes.

Sources of Funding for Senior Day Care Businesses

With regards to funding, the main sources of funding for an senior day care business are personal savings, credit cards, bank loans and angel investors. With regards to bank loans, banks will want to review your business plan and gain confidence that you will be able to repay your loan and interest. To acquire this confidence, the lender will not only want to confirm that your financials are reasonable, but they will also want to see a professional plan. Such a plan will give them the confidence that you can successfully and professionally operate a business. Personal savings and bank loans are the most common funding paths for elderly daycare businesses.

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How to write a business plan for a senior / adult day care center.

If you want to start an adult day care business or expand your current one, you need a business plan. Below we detail what you should include in each section of your business plan for a senior day care center:

Executive Summary

Your executive summary provides an introduction to your business plan, but it is normally the last section you write because it provides a summary of each key section of your plan.

The goal of your Executive Summary is to quickly engage the reader. Explain to them the type of adult / senior day care business you are operating and its status. For example, are you a startup, do you have an elderly daycare business that you would like to grow, or are you operating a chain of elderly daycare businesses?

Next, provide an overview of each of the subsequent sections of your plan. For example, give a brief overview of the elderly daycare industry. Discuss the type of elderly daycare business you are operating. Detail your direct competitors. Give an overview of your target customers. Provide a snapshot of your marketing plan. Identify the key members of your team. And offer an overview of your financial plan.

Company Analysis

In your company analysis, you will detail the type of senior day care business you are operating.

For example, you might operate one of the following types of adult day care businesses:

Social model : this type of business provides supervision and socialization through activities such as discussion groups, arts and crafts, games and dancing, or memory stimulation exercises.
Medical model: this type of business serves individuals with medical problems (including dementia) who may require monitoring, nursing care, social work, occupational therapy, physical therapy, nutritional counseling or recreational therapy.
Combination model: this type of daycare uses a combination of the social and medical model to provide supervision and socialization through therapeutic group activities, as well as medical services such as monitoring, nursing care, social work, and a range of therapies.

In addition to explaining the type of adult day care business you will operate, the Company Analysis section needs to provide background on the business.

Include answers to question such as:

When and why did you start the business?
What milestones have you achieved to date? Milestones could include the number of customers served, number of positive reviews, etc.
Your legal structure. Are you incorporated as an S-Corp? An LLC? A sole proprietorship? Explain your legal structure here.

Industry Analysis

In your industry analysis, you need to provide an overview of the elderly daycare industry.

While this may seem unnecessary, it serves multiple purposes.

First, researching the elderly daycare industry educates you. It helps you understand the market in which you are operating.

Secondly, market research can improve your strategy, particularly if your research identifies market trends.

The third reason for market research is to prove to readers that you are an expert in your industry. By conducting the research and presenting it in your plan, you achieve just that.

The following questions should be answered in the industry analysis section of your adult day care business plan:

How big is the elderly daycare industry (in dollars)?
Is the market declining or increasing?
Who are the key competitors in the market?
Who are the key suppliers in the market?
What trends are affecting the industry?
What is the industry’s growth forecast over the next 5 – 10 years?
What is the relevant market size? That is, how big is the potential market for your adult day care business? You can extrapolate such a figure by assessing the size of the market in the entire country and then applying that figure to your local population.

Customer Analysis

The customer analysis section must detail the customers you serve and/or expect to serve.

The following are examples of customer segments: adults with self-care difficulties, adults with Alzheimer’s or other forms of dementia, adults with hearing and/or vision difficulties, and adults with ambulatory difficulties.

As you can imagine, the customer segment(s) you choose will have a great impact on the type of elderly daycare business you operate. Clearly, families of adults with Alzheimer’s would respond to different marketing promotions than families of adults with ambulatory difficulties, for example.

Try to break out your target customers in terms of their demographic and psychographic profiles. With regards to demographics, include a discussion of the ages, genders, locations and income levels of the customers you seek to serve. Because most elderly daycare businesses primarily serve customers living in their same city or town, such demographic information is easy to find on government websites.

Psychographic profiles explain the wants and needs of your target customers. The more you can understand and define these needs, the better you will do in attracting and retaining your customers.

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Competitive Analysis

Your competitive analysis should identify the indirect and direct competitors your business faces and then focus on the latter.

Direct competitors are other senior / adult day care centers.

Indirect competitors are other options that customers have to purchase from that aren’t direct competitors. This includes senior living providers, home healthcare agencies, retirement communities, and convalescent centers.

With regards to direct competition, you want to describe the other elderly daycare businesses with which you compete. Most likely, your direct competitors will be elderly daycare businesses located very close to your location.

For each such competitor, provide an overview of their businesses and document their strengths and weaknesses. Unless you once worked at your competitors’ businesses, it will be impossible to know everything about them. But you should be able to find out key things about them such as:

What types of customers do they serve?
Do they specialize in caring for individuals with specific disabilities / diseases?
What is their pricing (premium, low, etc.)?
What are they good at?
What are their weaknesses?

With regards to the last two questions, think about your answers from the customers’ perspective. And don’t be afraid to ask your competitors’ customers what they like most and least about them.

The final part of your competitive analysis section is to document your areas of competitive advantage. For example:

Will you provide a wider variety of activities?
Will your daycare offer extra services, such as transportation?
Will you provide better customer service?
Will you offer better pricing?

Think about ways you will outperform your competition and document them in this section of your plan.

Marketing Plan

Traditionally, a marketing plan includes the four P’s: Product, Price, Place, and Promotion. For an adult day care business, your marketing plan should include the following:

Product : In the product section, you should reiterate the type of elderly daycare company that you documented in your Company Analysis. Then, detail the specific products you will be offering. For example, in addition to supervision and group activities, will your daycare offer occupational and speech therapy, or other rehabilitation therapies?

Price : Document the prices you will offer and how they compare to your competitors. Essentially in the product and price sub-sections of your marketing plan, you are presenting the adult day care service you offer and the prices.

Place : Place refers to the location of your elderly daycare company. Document your location and mention how the location will impact your success. For example, is your elderly daycare business located near a hospital, or in a residential district? Will you also provide transportation to your daycare? In this section, discuss how your location will provide easy accessibility to your clients.

Promotions : The final part of your elderly daycare marketing plan is the promotions section. Here you will document how you will drive customers to your location(s). The following are some promotional methods you might consider:

Advertising in local papers and magazines
Reaching out to local websites
Signs and billboards
Social media marketing
Local radio advertising

Operations Plan

While the earlier sections explained your goals, your operations plan describes how you will meet them. Your operations plan should have two distinct sections as follows.

Everyday short-term processes include all of the tasks involved in running your elderly daycare business, including marketing, planning and executing activities, overseeing therapies, maintaining licensing requirements, and providing care for customers.

Long-term goals are the milestones you hope to achieve. These could include the dates when you expect to serve your 100th family, or when you hope to reach $X in revenue. It could also be when you expect to open an elderly daycare business in a new location.

Management Team

To demonstrate your elderly daycare business’ ability to succeed, a strong management team is essential. Highlight your key players’ backgrounds, emphasizing those skills and experiences that prove their ability to grow a company.

Ideally you and/or your team members have direct experience in managing elderly daycare businesses. If so, highlight this experience and expertise. But also highlight any experience that you think will help your business succeed.

If your team is lacking, consider assembling an advisory board. An advisory board would include 2 to 8 individuals who would act like mentors to your business. They would help answer questions and provide strategic guidance. If needed, look for advisory board members with experience in nursing care or rehabilitation, or successfully running small businesses.

Financial Plan

Your financial plan should include your 5-year financial statement broken out both monthly or quarterly for the first year and then annually. Your financial statements include your income statement, balance sheet and cash flow statements.

Income Statement : an income statement is more commonly called a Profit and Loss statement or P&L. It shows your revenues and then subtracts your costs to show whether you turned a profit or not.

In developing your income statement, you need to devise assumptions. For example, will you provide care for 10 individuals per day, or 20? And will sales grow by 2% or 10% per year? As you can imagine, your choice of assumptions will greatly impact the financial forecasts for your business. As much as possible, conduct research to try to root your assumptions in reality.

Balance Sheets : Balance sheets show your assets and liabilities. While balance sheets can include much information, try to simplify them to the key items you need to know about. For instance, if you spend $50,000 on building out your elderly daycare business, this will not give you immediate profits. Rather it is an asset that will hopefully help you generate profits for years to come. Likewise, if a bank writes you a check for $50,000, you don’t need to pay it back immediately. Rather, that is a liability you will pay back over time.

Cash Flow Statement : Your cash flow statement will help determine how much money you need to start or grow your business, and make sure you never run out of money. What most entrepreneurs and business owners don’t realize is that you can turn a profit but run out of money and go bankrupt.

In developing your Income Statement and Balance Sheets be sure to include several of the key costs needed in starting or growing an elderly daycare business:

Location build-out including design fees, construction, etc.
Cost of equipment and supplies
Payroll or salaries paid to staff
Business insurance
Taxes and permits
Legal expenses

Attach your full financial projections in the appendix of your plan along with any supporting documents that make your plan more compelling. For example, you might include your location lease, or an overview of all therapies offered at your facility.

Putting together a business plan for your elderly daycare business is a worthwhile endeavor. If you follow the template above, by the time you are done, you will have an expert senior daycare business plan; download it to PDF to show banks and investors. You will really understand the elderly daycare industry, your competition, and your customers. You will have developed a marketing plan and will really understand what it takes to launch and grow a successful elderly daycare business.

Elderly Daycare Business Plan FAQs

What is the easiest way to complete my elderly daycare business plan.

Growthink's Ultimate Business Plan Template allows you to quickly and easily complete your Elderly Daycare Business Plan.

What is the Goal of a Business Plan's Executive Summary?

The goal of your Executive Summary is to quickly engage the reader. Explain to them the type of elderly daycare business you are operating and the status; for example, are you a startup, do you have an elderly daycare business that you would like to grow, or are you operating a chain of elderly daycare businesses?

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Daycare Business Plan Example

AUG.16, 2016

We live in a world where everyone seems to be in a hurry to get things done before the day ends. Parents and guardians have no option but to look for day care centers to take care of their children, as they go about their daily chores during the day. The growing demand for professional day care services has led to a boom in the rate at which these facilities are being set up.

Professional Business Plan Writing for a Day Care Center

Studies show that it is a lucrative business that you can count on to help you gain financial stability and freedom. It is imperative that you hire a professional business writer who is conversant with how the daycare center business plan template should be written to layout all the necessary groundwork to avoid unnecessary hurdles along the way.

For over three years, we have been providing expert daycare center business plan writing services to clients from all across the globe. The impressive reputation that we have maintained over time is enough proof that we deliver on our promises. Our writers have not only vast hands-on experience in daycare center business plan writing samples and templates but also an in-depth understanding of the economy and business factors that have a direct impact on daycares.

Here are five reasons why you should hire us to write a plan for your upcoming daycare business.

We have academic qualifications and vast hands-on experience
We will carry out feasibility studies to ensure that each recommendation applies to your business
We will connect you with industry leaders who will give you ideas that you can implement in your business to enhance its growth
We have excellent time management skills and will complete the plan within the agreed period.

Here is a brief description of the various sections of a professional daycare business plan.

General Overview

As the name suggests, this is an overview of the business that summarizes the goals and objectives as well as the reasons why starting this form of business is a viable idea. Our team will do comprehensive research and conduct feasibility studies to help you set sustainable, measurable, accurate, and attainable goals that will point your business in the right direction.

In-depth Analysis of the Day Care Industry

This section of the business plan daycare center sample covers all the facts and factors that are unique to this industry. Using our proven business plan writing and research skills, we will help you to write down a report that analyzes the industry in-depth but in an easy to understand manner. We will also use our special analytical tools and skills to estimate the average daycare industry revenue and trends that you should know from the word go.

Closer Look at the Market

If you want to succeed in any form of business, you need to take a close look at the current market and come up with strategies for penetrating and competing effectively with the existing daycare centers. Our professional business experts will take a closer look at the current market and help you come up with strategies that will give you a higher cutting edge. They will help you to position your business for success despite the bubbling competition in the industry.

Pricing and Marketing Plans

You need to have a marketing plan to help popularize your services to the target audience. If you target a particular geographical region, you will need to come up with a tactic on how to reach out to the local customers. Our marketing experts work hand in hand with the writers and other members of our team to come up with an ideal marketing strategy. We will give you clear guidelines on how to communicate with the potential clients.

Legal Structure

Just like any other business, there are some rules and regulations that you need to abide by to avert inconveniences. We will help you to understand the legal framework that governs daycare. They will help you to understand the difference between a sole proprietorship, a corporation, and partnership. More importantly, we will help you to get legal accreditation by showing you all the documents that you need to fill and submit to the relevant authorities before you start offering the daycare services.

Why to Choose Us

OGSCapital has been around for many years and takes pride in the fact that it has helped establish hundreds if not thousands of businesses in a wide array of niches. By hiring us, you are guaranteed daycare business plans that will help to establish and run the business smoothly. We also have the skills and ability to coin the daycare center business plan to help you get financing from venture firms.

Feel free to get in touch with our support team to get a clear perspective of our daycare center business plan writing packages that have template files included for assistance. We look forward to seeing your daycare center business start and grow to its full potential.

7 Doubts to Clear before Starting Your Daycare Business

As far as the statistics of the daycare business goes, it seems to be spinning quite a good sum of money in the upcoming years. Thus, if you are planning to opt for this industry then it’s a very good idea, please go ahead. But, before jumping on to start the day-care center; you will have various doubts.

It is very important that you invest some time to understand and sort the doubts. As you will go on answering each of the doubtful queries, it will clear your head and assist you in making sound decisions. You will no longer be confused regarding essential matters.

Moreover, it will aid you to start-up in a focused and disciplined manner. Once you are completely sure you are on the right track, you will also be capable of drafting an apt daycare business plan.

The 8 Doubts that need your attention have been listed as follows:

1. Do I need to have a license to start a daycare business? Does my town, state, city or country call for such a license?

Yes, almost everywhere in the world, a license is needed for starting a day-care center. Unlike several other types of businesses, it has strict orders which are mandatory for the owner to follow.

You need to do your research in order to be sure whether the place you have chosen to start your daycare requires you to have a license or not.
Calculating the time and expenses required for acquiring the necessary license, permits and various other legal documents is a must. Additionally, remember to balance out these expenses with your expected earnings.
Find out all about zoning restrictions in the chosen area where you wish to start your day-care center. Often people forget about it. This can cause serious trouble when you have made all plans, spent a hefty sum and in d middle of everything you get a warning that the particular area prohibits setting up such a center. A large number of private residences and commercial complexes have zoning restrictions. So, best research before, than regret later.

2. Is it a good idea to opt for a day care franchise?

It is up to you to decide whether you wish to go with a daycare franchise business plan or not. To help you make up your mind here are a few pointers-

The US alone has more than 4000 daycare franchises. So, you can imagine that across the world there might be innumerable franchises. You may zero down on your preferred franchise as per your place before you start your facility.
As far as the franchises cost goes, it can range from anywhere around 60 thousand dollars up to 4 million dollars.
If you have a business partner, then both of you can sit and discuss, (with the help of other business samples and templates), whether going with franchising is a good idea or not? Whether it will cover your private and monetary targets? Whether it will suit your center well enough? If you feel positive after answering such queries that you can go with it.

3. Is there a need to set-up a budget model? What should such a sample model encompass?

Of course there’s the need! Such a sample model of your budget gives an overall idea of all the diverse expenses that go in starting up a day-care business. You may check budget samples and templates of related facilities for help. The model should comprise-

The rent of the space
Salary of the employees, cleaners and other members
Various bills such as utility, electricity, water etc.
The fee for the administration
Licensing costs
Zonal costs
Various other start-up costs

4. Which role should I play in my business?

The part to be played by you in your day care center depends on your preference. It is up to you to decide which duty and responsibility you choose to look after. It’s good to know your expertise right at the start. That said, when making the choice; ensure to keep in mind what you are best in. There are many business owners who cannot help but feel the urge to interfere and look into all the business matters. It that case, you should surely look at every aspect of your business, how everyone is working and what are the progress. But when you start-up, you need to focus on a playing only a particular role or duty. You need to find your strong points. For instance-

If you are very warm and friendly with kids, you may start your business as a fresh entrepreneur.
If you are a well-qualified teacher having all the necessary degrees, you may choose to teach the students. You can also keep a good check on each level of your facility.
If you are good with handling accounts, then you may take up the charge of handling the finances of the center.

It is always a positive step to designate your role in the business right at the start. That will assist you in understanding which areas you will need help and support. Thus, you will manage your business better.

Tip: There are several free aids like template files available online. They have been designed and developed keeping in mind the requirements of entrepreneurs willing to start such centers.

5. What kind of homework should I do? Can I go and visit other daycare centers and speak to them face-to-face?

The best homework that can prove to be a huge advantage for your day center is visiting other similar facilities. It is like a learning lesson for every start-up facility. Meeting with other owners of such facilities can give a realistic idea of the business. Asking them various questions as a customer, will help you understand the client’s point of view and their demands. Knowing and understanding the consumers requirements helps fulfill their needs well.

Before you start, there are all sorts of questions you can ask. Some such questions may be-

What is the child-staff ratio maintained by the center?
Is the neighborhood suitable for the child?
What steps and procedures do they follow to attend to a sick kid?

When visiting a facility, you may even ask about a sample or template of their daycare center business plan! As you make your inquires, take note of the things you would wish to adopt and eliminate for your own facility.

6. Is there any provision of childcare center funds and Grants?

The funds and grants are quite limited for the childcare centers that have specifically started with the intention of earning good business profit. Child and Adult Food Care Program (CAFCP) is most likely the only government body that provides funding support to these types of start-up profitable ventures.

Those start-up childcare facilities that are launched as non-profit endeavors have some great funding and grant options available. Some of the advantages of non-profit start-up facilities offering to look after the children and the elderly are-

They have tax deduction as well as tax exemption assistance
There are several government as well as private groups and communities who are willing to come forward and help through funds and grants
They can avail free advertising for a definite time-period on the online platform at the start of the center. This is a huge benefit as advertising costs are quite high. Moreover, even a 30 days free promotion online is enough to make the center visible among the masses.

There are various start-up daycare business plan samples and templates available online both for profit as well as non-profit facilities so that they can garner enough funds to start and run their service conveniently.

7. Which child education program to opt for- Montessori?

There are several types of education program. You need to pick the program that is most befitting for your start-up center. Montessori is definitely the oldest and the finest of the lot. Yet, there are many other new education programs to choose from rather than sticking to the same old Montessori program. To find the most suitable program before you start, you ought to do your research and go through several templates. You will find good information by visiting other centers directly.

UK Start-Up Visa Business Plan

There is a vast expanse of information available online. Participate in the group discussions of teachers and parents of similar facilities online. There you might come across the education program that is most popular in the present times. Browse through samples of daycare center business plan, in order to find which education program is most beneficial for the child. Always keep in mind that whichever education program you pick, it should suit your start-up or existing facility’s philosophy and agenda accurately.

A daycare center business plan plays a vital role. So as you start a new phase of life as a fresh entrepreneur you must be prepared with all the tools to make an impact on the investing agents, prospective clients and partners. They are the ones who will assist you in your endeavor. With their support your dreams of becoming a successful start-up business owner can turn into reality. So, you can use an excellent template to draft a daycare policy with absolute perfection.

You can take the help of samples and templates available abundantly online to craft your childcare business plan. You can also opt for our excellent daycare business consultation. Our professionals will guide you in every step of creating your daycare center business plan. Our exceptionally skilled and experienced experts can help you understand and build your daycare center business plan to impress investors and gain their confidence.

Naming the Business Correctly- It’s Importance

How to name your start-up business? This is an important question. Those who overlook the significance withheld in the naming ordeal, often face various troubles finding clients. Finding the most unique and suitable name needs you to look into various factors.

Firstly, your must understand the term you are using –

The name represents your business. The service you intend to offer your prospective customers. Now, most often entrepreneurs of start-up facilities are busy focusing on the different factors, and end up naming their facility incorrectly. This happens hugely because of confusion in understanding some commonly used terms. Here are some sample names to give you an idea and eliminate confusion:

Daycare: This is a broad term which many fail to realize. It may suggest that you offer to look after a child, an elderly person, a differently-able person or an animal during the daytime. If you do not specify then you might come across clients who wish to leave there pets during the daytime, while actually you only offer to look after children.
Childcare: This is a much more specific name which signifies looking after children while their parents are at work, etc. But, it’s a common term, so you may add a unique term to make your start-up facility stand out. Furthermore, it doesn’t ascertain particular age group of the kids.
Home Childcare: This name clearly states that you offer the service of looking after little kids at your own home. This attracts many parents who prefer to leave their children in a home-like and comfortable atmosphere.

Still, if confusion persists you can dial up and reach our expert daycare business consultation service. We have brilliant daycare business consultation professionals who can assist you with finding a unique name. You can refer to various templates written by our expert writers. Going through templates will give you an idea on the structure. Since the daycare center business plan s for each type of care facility is distinctive from each other, we can help you with your home daycare business plan.

Checklist of things to you should ‘DO’ when naming your business

Select a name that completely befits the distinguished service you plan on offering..

The name must reflect your childcare philosophy. Take for example- a parent by reading the name- “Lakewood Academy” would know very clearly that it is not a center for looking after kids but helps kids in learning. The terms ‘preschool’ and ‘academy’ help owners to denote that they plan on offering academic learning to the children in order to prepare them for school. If your start-up center focuses on looking after the kids than “daycare” or “childcare” are the terms you must use.

Go with Easy-to-Spell Names

Many times, owners misspell the names of their center intentionally. They do so to stand-out and be different. Take as a sample- the term “KIDZ” which is used instead of “KIDS”. It is best to avoid such incorrect spellings. After all, you would not want to set a wrong example by teaching the little ones incorrect spellings. Furthermore, It will save you ample times and effort as you would not need to spell the name of your facility to every person. Even apostrophes play a central role. “Mary’s Tiny Tot’s” is wrong; it should be “Mary’s Tiny Tots”.

Use Simple and Short Names

Have you ever noticed that long and complex names are difficult to remember? You would not want your prospective clients to forget your center’s name. Keep it shorts and simple.

Opt for names that have INC/LLC in it (in case applicable)

In case your facility encompasses some kind of distinctive legal structure, do mention it in your center’s name. This will attract more customers to your business.

Checklist of things to you should ‘NOT DO’ when naming your Start-up business

Avoid selecting names that are used pretty commonly by start-up and existing centers. It your service facility’s name matches with several other facilities then the exclusive and novelty of name is lost. So, it’s best to steer clear of overused terms. Some sample names that are frequently used are- “ ABC Daycare” or “123 Pre-school”
Do not pick names that denote a broad meaning, rather try to be more specific. Being precise in naming your facility will draw the suitable clients towards your center. If your service caters to a particular age-group then name you start-up accordingly. There are terms like baby, infant, toddlers etc. that specifically signify only babies that are 1 year old or below that. Again, morning, afternoon, day, night, evening, Sunday, weekdays, weekends, etc. specify the time or days when you offer to look after the children.
Strictly keep away from lengthy and complicated names for your center. Most of the time services, in the attempt to stand-out, try to input too many terms. The name ultimately turns out to be flashy and confusing. Such tough names must be avoided as you don’t want to lose the key essence of your care service.

Starting a Home Daycare business: Useful Ideas

The picture of a day care center as a start-up business seems to be a satisfying and money-spinning deal. Yes, it surely is! But is it as simple as it looks if started at home? Yes, it is; but, only to a certain extent! The planning part is the difficult area of this type of facility which gives majority of the start-up entrepreneur sleepless nights. There are several factors to decide before starting the center. Making a list of all your ideas is a good way to go. Noting each and every aspect that you need to decide upon, be it the space or the hours, assists in categorizing and channeling all your start-up ideas to build a sound home daycare business plan. Refer to good templates to get a grasp of how you should strategically organize your ideas.

Daycare Room

Whether you have a large home with many rooms, a medium sized home with a large hall or an average home with multiple rooms, you will need to utilize your space smartly. Every type of space can be worked out to become suitable to run a center that looks after kids. It is a misconception that you have to have a huge house to start a center for kids.

A few pointers to remember are-

When you offer to look after children, you may include pre-schooling, meals, playing and nap times. You can use your backyard for playing, kitchen area, living space and also family bedrooms.
Certain states or cities have rules and regulations regarding the space to start a day-care center. The space requirement is usually measured in square foot area. If you do not have any information about such regulation you can ask other similar services. The best way is to contact the day-care license providing office as they will give you the correct reliable information.
In case you live in a rented flat or apartment, you need to take prior permission from the owner of the house.

Time Of Availability

It is completely up to you, as to when you wish to provide the service of looking after children. The hours have to be convenient for you. Moreover, since you will need the rooms you would want to schedule the timings accordingly.

If you can offer the service at almost all hours then you can give your similar centers a tough competition. Do some field research and find out the timings that your neighborhood services are offering. Once you have all the necessary information of the operating hours of near-by facilities you must-

Fix a time that successfully meets the most popular hours demanded by maximum parents.
Try to fix your operating hours that are different than others, you may open few hours early or close a few hours late. There are Sundays, or weekends, evening, night or early morning timings that are uncommon, yet in demand as parents now-a-days have different shift hours.

Age-wise enrollment

A good and easy way to fill your childcare center is by giving admission to children to various age groups. This tactic is adopted by several start-up entrepreneurs. A problem with having mixed aged kids is that children of different age need to be looked after differently. Having same age group kids makes it very easy to handle and run the center proficiently. So, enlist your expertise and then decide on which age-group kids you wish to enroll.

Business Plan

Make a proper strategy before starting the business is necessary. The benefits of having a daycare center business plan are-

It aids in merging various ideas into the business
There may be various stages that would lead to accomplish the pre-set target. A home daycare business plan helps in arranging all those steps.
Often when you go off-track, you can rely on your daycare center business plan. Looking back into your childcare business plan will help you understand where you went wrong. This will let you check yourself in time.
The budget model incorporated in your home daycare business plan works as a sample to assist you in handling your expenditure. You will not end up going overboard with monetary matters.

Fun Sessions

It is a positive step to make arrangements for various activities that kids can enjoy, before starting the business. Some fun ways to keep the kids happy and engaged are-

Story telling
Gaming sessions
Music and singing or dancing sessions
Having puzzles and toys as per age-group
Having swings, sea-saw and other outdoor play things
Taking trips at intervals to parks
Going out on a walk

These five ideas can prove to be immensely helpful when included in your home daycare business plan. We have samples and templates to aid you in preparing your final draft. But, this is not all. There are various other things that must be included in a daycare center business plan template. Our daycare business consultation experts can save you from all the research. You can contact us through call or via email and get all the assistance you need. Our daycare business consultation team will be more than glad to assist you build the finest daycare center business plan .

Download free sample business plan day care center

OGScapital writer specializes in business plan themes such as small business clothing store , starting a babysitting business , bouncy castle business plan , kids indoor playground business plan , business plan template for summer camp , child care business plan and many other business plans.

OGSCapital’s team has assisted thousands of entrepreneurs with top-rate business plan development, consultancy and analysis. They’ve helped thousands of SME owners secure more than $1.5 billion in funding, and they can do the same for you.

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Daycare Business Plan

As a lot of toddlers turn to preschool age, the number of enrollees in daycare also increases. As a businessman, you should see this as an opportunity. Parents spend a great deal of time selecting the best daycare for their sons or daughters. Composing a daycare business plan will keep you one step ahead of your competitors.

6+ Daycare Business Plan Examples

1. daycare business plan template.

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6. Fairview Daycare Business Plan

7. Printable Daycare Business Plan

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What Is a Daycare Business Plan?

A daycare business plan is a written document that enumerates the goals of a childcare business and specifies the methods to accomplish them. It also includes the marketing strategy to promote the daycare and a framework detailing how they can set their daycare apart from similar businesses. This business plan prioritizes services that focus on teaching and securing the safety of the children.

How To Compose a Productive Daycare Business Plan

Preschool parents are hard to impress. They are very critical in scrutinizing every daycare they come across. To hook these parents, devise an impressive daycare business plan that would make them choose your daycare. Taking care of children is a significant task. To make sure you can cater to the children’s needs, be careful in creating your business plan.

1. Make a Plan Outline

Start your plan outline by including a list of your goals and the corresponding procedure you plan to follow in achieving them. Your outline would serve as your draft. That said, you can list everything that comes to mind and come back to review and omit the items that don’t contribute to the effectiveness of your plan. There are available sample outline formats and templates online.

2. Study Your Market

The people you’re offering your services to are both the children and their parents. You should focus on that fact the entire process of your plan-making. You should always ask yourself, “will it be the best for the children?”, “will it satisfy the parents?”. The best way of data-gathering is by conducting an interview and through market research .

3. Run a Competitor SWOT Analysis

Aside from your market, also research your daycare competitions. What are their strengths? What about their weaknesses, opportunities, and threats? You will find out by conducting a competitor SWOT analysis on them. The data you can gather will help you to find out what your advantage and disadvantages over them are.

4. Formulate Your Marketing Strategy

In creating your marketing strategy plan , it is advisable to appeal more to the parents because they are the ones who would decide on the final call regarding their daycare choice. Despite that, it is essential to keep your content strategy and designs child-friendly. Some marketing strategies you can try out are posting a flyer or creating an infomercial about your daycare business.

What are the parts of a business plan?

The title page, executive summary , marketing strategy plan, business description, competition analysis, operation plan, design plan, and business budget are the parts of a business plan. Each segment of this document is necessary for ensuring the accomplishment of your objectives. Tailor your business plan depending on the nature of your business.

How can I attract parents to my daycare?

Promoting your daycare on social media is a clever way of spreading awareness about your daycare. Another way is to depend on peer-to-peer (P2P) marketing. This type of marketing entails asking your existing customers to recommend your daycare to other parents they know. Parents tend to trust other parents more when they see good results.

What are the various types of business plans?

The types of business plans vary on their purpose and on the mediums used in creating them. The miniplan, the first type, is like a summary of the whole business plan. It focuses on the top priorities of the business. The second type of plan is the presentation plan, which uses PowerPoint presentations. The third one is the working plan, and the last one is the what-if plan.

Parents want the best for their children. Now, your job is to prove that you are the best, and they would naturally pick your daycare. Proving to be the top in offering childcare services is not fun and games. It requires the best daycare business plan. Win the hearts of the parents and prepare to receive several daycare application forms by the start of the enrollment period.

Text prompt

Instructive
Professional

Create a study plan for final exams in high school

Develop a project timeline for a middle school science fair.

Daycare Business Plan Template

Written by Dave Lavinsky

Business Plan Outline

Daycare Business Plan Home
1. Executive Summary
2. Company Overview
3. Industry Analysis
4. Customer Analysis
5. Competitive Analysis
6. Marketing Plan
7. Operations Plan
8. Management Team
9. Financial Plan

Competitive Analysis

Red Balloon Daycare will face competition from other businesses with a similar company profile. A summary of the competitor companies is below.

Direct and Indirect Competitors

Busy bee manor.

Busy Bee Manor is owned and operated by The Bookout Family, a young family that moved to Manor, Texas a few years ago. Kathryn Bookout is the Director of the facility and is educated in Early Childhood Education as well as Special Education. She was previously the lead preschool teacher at a school for children with disabilities. Busy Bee Manor offers quality early childhood education and concentrates on early development foundational skills. Their mission is to create a safe and stimulating environment for preschool age children. They do this by providing hands-on, child centered educational experience through a curriculum rooted in developmentally appropriate practice, mindful interactions, and meaningful relationships.

The programs offered at Busy Bee Manor include infant classes, toddler classes, preschool, and pre-kindergarten. The daycare keeps the class size to a ratio of 2:10 for infants, 2:12 for toddlers, and 2:15 for preschool and pre-k. The curriculum offered by Busy Bee Manor offers learning through play. There are many hands-on skills and games that are given that help in the development of languague, literacy, mathematics, and science. Children will be developed in these lifelong skills by learning and utilizing in a fun, playful way.

Tuition rates are not given online and the hours are from 7:00 am – 6:00 pm. The daycare also follows the neighboring Manor school district calendar.

The Children’s Courtyard of Round Rock

The Children’s Courtyard of Round Rock is located near the Dell campus of Round Rock and serves the communities of Round Rock, Pflugerville, and Austin. They provide high quality child care and education in a warm, safe, and loving environment. They take the safety of the families and staff as utmost priority. The daycare services they offer are infant care, Toddler, Early Preschool, Preschool, Pre-Kindergarten, and a Summer Camp. Very recently, The Children’s Courtyard added a Montessori program to its list of offerings. The school is nationally accredited by AdvancED and all teachers are early education professionals who stay current with monthly training sessions and ongoing staff training. The teachers are also certified in First Aid and CPR. Other programs offered by The Children’s Courtyard of Round Rock are Junior Kindergarten, Private Kindergarten, junior counselors, electives, Grow Fit, and drop-in care. All programs offer an exceptional early education experience and will ensure each child is ready for academic success. The Children’s Courtyard also utilizes a unique MyPath program for achieving positive behavioral habits. The myPath app features age-appropriate tips and ideas for teachers and parents to help children overcome social, emotional, and cognitive challenges with a positive approach. It is very natural for a child to exhibit disappointment or anger negatively, and these approaches help them to find positive ways of dealing with the challenges.

Children’s Lighthouse

The Children’s Lighthouse is the business of two like-minded families of whom children’s wellness and education is of utmost priority. Their main goal is to provide the best social and character values alongside with the best educational experience built on a foundation of trust. Children’s Lighthouse offers infant and toddler classes, preschool, school age, and EX-STREAM summer camps. Ex-STREAM is a summer camp for school age children to have fun and learn science concepts in a neat, informing, engaging, and fun way. Children’s Lighthouse also utilizes the C.A.R.E.S. Curriculum, a proprietary curriculum that takes a values-based approach to education while implementing current research in today’s changing times. The Lighthouse C.A.R.E.S. curriculum is based on age-appropriate, comprehensive learning approaches, while incorporating character values like integrity, fairness and honesty. The daycare prides itself in being family-focused with an emphasis on developing children academically and emotionally from as early as six weeks old.

The facility of Children’s Lighthouse takes children from six weeks to twelve years, offers live internet video, has security-controlled building access, has age-appropriate playgrounds, and has before and after school programs.

Competitive Advantage

Red Balloon Daycare will be able to offer the following competitive advantages over their competition:

Friendly, warm, and safe environment for children.
All teachers are early education certified, trained, and experienced.
Menu that is developed with the highest regard for nutritional value at a young age. All meals served will be nutritionally well-rounded, fresh, and prepared with the safest cleanliness standards.
Live internet video of all classrooms and rooms so that each parent has the ability to logon and check on their child at any given time.
Security-controlled facility access. Only permitted parents and visitors are given access via a passcode.
Age-appropriate playgrounds with the safest playground equipment.

IMAGES

Daycare Business Plan Sample
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20 Daycare Business Plan Template
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Daycare Business Plan Template Sample Pages
Printable Daycare Business Plan Pdf

VIDEO

5 Business Account Daycare Owners Should put in place
Start A Daycare & Earn Lakhs. Daycare തുടങ്ങി മാസം ലക്ഷങ്ങൾ സമ്പാദിക്കാം|🙂 #money#business#ideas
Daycare Business Financial Feasibility Study Template
Apna Daycare ka business karien (Hindi / Urdu)

COMMENTS

Fill Out Sample Business Plan
Fill Out A Business Plan In Minutes. Easy To Use, Save, & Print. Try Today! Customize Business Plan Templates Online 100% Free. Print & Download Now!
Business Plan: Day Care
Fill Out A Business Plan In Minutes. Easy To Use, Save, & Print. Try Free Today! Create, Download, & Print A Business Plan - Simple Platform - Try Free Today!
Daycare Business Plan Template (2024)
Starting a daycare can be an exciting endeavor. Having a clear roadmap of the steps to start a business will help you stay focused on your goals and get started faster.. 1. Develop A Day Care Business Plan - The first step in starting a business is to create a detailed child care business plan that outlines all aspects of the venture. This should include market research on the childcare ...
How to Write a Business Plan for Daycare and Preschool
Writing a daycare business plan. We've discussed licensing and investors. Now, you're ready to begin the framework of your business plan for daycares and preschools. Here's what you'll need to get started: Business description; Needs assessment; Budgets; Insurance policies; Operating policies and procedures; Marketing strategy; Business ...
How to Write a Business Plan for a Daycare Center
Asking for free months shows you're a competent negotiator who takes his business seriously and has a long-term profit goal in mind. Another thing to watch out for with monthly rent is all the added costs. Say your price is $20 per square-foot and your building is 5,000 square-feet. This adds up to $100,000.
How to Write a Business Plan for a Daycare: Complete Guide
In this article we go through, step-by-step, all the different sections you need in your daycare business plan. Use this template to create a complete, clear and solid business plan that get you funded. 1. Executive Summary. The executive summary of a business plan gives a sneak peek of the information about your business plan to lenders and/or ...
PDF Daycare Business Plan Template
This business plan contains an overview of all the planning that is required for this business. Location, staff, food, and service quality etc. are some important aspects that the [owner(s)] of the daycare center will focus on.
The Daycare Business Plan Blueprint (Examples + Template)
This daycare business plan example shows you how to include this vital information: "The daycare will be located at 123 Main Street in a commercial space currently leased by the owner. The lease agreement is for three years with an option to renew for an additional three years.
How to Write a Child Care Business Plan
The executive summary should include all the nitty-gritty details of your daycare such as the address, hours of operation, and the number of children it will serve. It should also include what sets you apart from other daycares. The executive summary sets the tone for the rest of the plan so the more information you include here, the better.
How to Start a Day Care: A Step-by-Step Guide
9. Write your day care contract and policies. To further legally protect your business, it's crucial that you draw up a contract, write out your day care policies, and require that potential ...
Day Care Business Plan Example
Sales Plan. Safe Kids Child Care will make a significant profit through the excellent care of children. Even though Safe Kids charges less, the company will see profit within the first year due to beneficial word-of-mouth advertising. The company expects to double its' clientele every six months, for the first 18 months.
Daycare Business Plan Template: A Step-by-Step Guide (2024)
Thus, including a web strategy in your business plan is necessary. Always remember, as a daycare service coming off as a trustworthy and reliable institution is crucial for your business to work. 5. Management and Organizational Structure. Having a well-structured management system is especially crucial for a daycare service.
Daycare Business Plan + Executive Summary w/ Examples
One daycare business plan example - a positioning statement for a 24-hour childcare center in Austin, Texas may look like this: "For the Austin-based family who is seeking childcare around the clock, Jenny's 24-Hour Daycare is a safe option for young children with nutritional meals, best-in-industry sleeping arrangements, a clean outdoor ...
How to create a daycare business plan
Helps raise money for your business: Experts estimate that for a home-based daycare serving four to six children, startup costs can exceed $36,000.A comprehensive business plan is essential when seeking investors or financial support. It showcases your clear vision, market research and growth strategies, demonstrating your commitment and knowledge about the daycare industry.
Free Day Care Business Plan Template + Example
1. Don't worry about finding an exact match. We have over 550 sample business plan templates. So, make sure the plan is a close match, but don't get hung up on the details. Your business is unique and will differ from any example or template you come across. So, use this example as a starting point and customize it to your needs.
How to Prepare a Daycare Business Plan
The phrase "business plan" can be kind of intimidating. But crafting one for your child care center doesn't have to be scary. Just follow the five steps below: 1. Executive Summary. Daycare business plans contain a lot of information. To make things easier on your business partners, future employees and potential lenders, start your plan ...
How to Start a Daycare Center: 15 Steps for Success
That said, here are 15 steps to starting your daycare center, even if you have zero experience. 1. Learn About Daycare Licensing Requirements. You might have started off as a babysitter or a nanny, but in order to start a full-on daycare business, you need to meet the proper licensing requirements in order to be legal.
Child Care Business Plan Example
The Toddler Warehouse will be competing in the child care industry. This industry is fairly broad and populated, there are companies at all levels, from the basic baby sitter services, to competitors of The Toddler Warehouse. There are service providers that offer standard business hours as well as services that offer night and evening hours.
Daycare: get a solid business plan (example)
The key points of the business plan for a daycare center What's the business model of a daycare center? Business model of a daycare center. A daycare center's business model revolves around providing childcare services for infants, toddlers, and young children. Revenue is generated through enrollment fees, monthly tuition, or hourly rates.
Child Care Business Plan Template [Updated 2024]
Child Care Business Plan Template. Written by Dave Lavinsky. Over the past 20+ years, we have helped over 5,000 entrepreneurs and business owners create business plans to start and grow their child care businesses. On this page, we will first give you some background information with regards to the importance of business planning.
Free Daycare Business Plan Template
Daycare Business Plan Template. Download our template and create a business plan for your daycare! When you are ready to start a daycare business, you need an effective plan outlining how to get there. High-quality child care is in high demand, but you must be prepared for the challenges of starting a new business.
How to Write a Business Plan for Starting a Day Care Center
Create Your Company Description. Create a general overview of your day care business plans. Write a brief summary of your goals and include why you think starting a day care business is a good ...
Raising Tomorrow: The Strategic Business Plan for Your Daycare Center
The most useful approach for establishing a daycare center's viability and sustainability is to develop a business plan encompassing market research, facility setup, staffing, safety measures, curriculum, pricing, marketing, finances, and compliance. This article digs into the fundamental components of a thorough business plan for opening a ...
How to Write a Business Plan for Your Daycare Center
A successful business plan needs information about the daycare center's policies and procedures. Policies and procedures are the foundation of a new business, and they are something you'll want parents to have a firm understanding of. To start with, think about developing a payment policy. This will entail things like how to handle late ...
Senior Day Care Business Plan & How-To Guide [Updated 2024]
Senior / Adult Day Care Center Business Plan Template. Over the past 20+ years, we have helped over 1,000 entrepreneurs and business owners create business plans to start and grow their adult day care businesses. On this page, we will first give you some background information with regards to the importance of business planning.
Daycare Business Plan Example [Update 2024]
Make a proper strategy before starting the business is necessary. The benefits of having a daycare center business plan are-. It aids in merging various ideas into the business. There may be various stages that would lead to accomplish the pre-set target. A home daycare business plan helps in arranging all those steps.
Sales & Marketing Plan for a Daycare (Example)
We have prepared this guide to help you develop a sales and marketing plan specifically for the business plan of a daycare business. It begins with a market analysis to understand competitors and families' childcare needs. Then, it emphasizes building the daycare's brand identity and market positioning. Lastly, it explores effective ...
Daycare Business Plan
Taking care of children is a significant task. To make sure you can cater to the children's needs, be careful in creating your business plan. 1. Make a Plan Outline. Start your plan outline by including a list of your goals and the corresponding procedure you plan to follow in achieving them. Your outline would serve as your draft.
Daycare Business Plan Competitive Analysis
The daycare keeps the class size to a ratio of 2:10 for infants, 2:12 for toddlers, and 2:15 for preschool and pre-k. The curriculum offered by Busy Bee Manor offers learning through play. There are many hands-on skills and games that are given that help in the development of languague, literacy, mathematics, and science.
TOP 10 BEST Daycare in Sunnyvale, CA
Toddler Daycare Cost Guide. Top 10 Best Daycare in Sunnyvale, CA - November 2023 - Yelp - Little Sunshine Home Daycare, Belen's Childcare Home, My Little Busy Bees Daycare, Santa Clara Montessori, Tulip Kids Academy, My Little Paradise Family Daycare, Busy Bees Family Daycare, Happy Daycare, Sunny Day Care, Little Giant Daycare.
Top 10 Best Day Care in Sunnyvale, CA
Reviews on Day Care in Sunnyvale, CA - Little Sunshine Home Daycare, Belen's Childcare Home, My Little Busy Bees Daycare, Santa Clara Montessori, Tulip Kids Academy ... "Tulip at Lawrence station has been a great center as a daycare option for our kid. ... Write daycare business plan. Search day care in popular locations. Nearby cities ...
Top 10 Best Child Care & Day Care in Sunnyvale, CA
Toddler Daycares, Education Based Child Daycares. Top 10 Best Child Care & Day Care in Sunnyvale, CA - November 2023 - Yelp - Little Sunshine Home Daycare, Santa Clara Montessori, Belen's Childcare Home, Busy Bees Family Daycare, Happy Daycare, Sunny Day Care, Santa Clara Family Day Care, Tulip Kids Academy, Always Smiling Daycare, Building ...

How to Write a Business Plan for Daycare and Preschool

What do daycare investors want?

Industry background and experience

Writing a daycare business plan

Business description

Your business is ready!

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The Daycare Business Plan Blueprint (Examples + Template)

But First...Is a Daycare a Good Business to Start?

How to Create a Daycare Business Plan

Business Model

Executive Summary

Create a Compelling Business Description

What's your Curriculum Based On?

How Big is Your Facility?

Who Is Your Target Market?

Do a Thorough Market Analysis

The Size of Your Market

Daycare Marketing Plan

Daycare Financial Plan

How much does it cost to start a daycare?

How much revenue can a daycare business make?

How much does daycare cost?

What is the typical child to staff ratio for a daycare?

What are the typical operating costs for a daycare?

How much profit can a daycare make?

What Are The Benefits of Creating a Daycare Business Plan?

Gives You a Roadmap to Follow

Helps You Secure Funding

Ensures Your Daycare Business is Feasible

Final Thoughts

You can get the Daycare Facility financial projection template here!

The daycare business projection template includes:

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How to Start a Day Care: A Step-by-Step Guide

How to start a day care business

1. Decide what kind of day care business you want to start

How much do you need?

2. Write a day care business plan

3. Obtain the necessary certification and licenses

4. Find a (safe) day care facility

5. Get insured

6. Get a business checking account and credit card

7. Get financing

SBA microloan

SBA community advantage

Government grants

Business credit card

8. Hire staff

9. Write your day care contract and policies

Daycare Business Plan

What is a Daycare Business Plan?

Why is a Daycare Business Plan Important?

It gives you a sense of direction

It helps you understand your target audience better

It helps you understand your competition better

It helps you convince your investors

It keeps you updated with the latest business trends

What does a Daycare Business Plan Look Like?

Daycare Business Plan Outline

What to Include in Your Daycare Business Plan?

1. Executive Summary

2. Services

3. Market Analysis

4. Web Plan

5. Management and Organizational Structure

6. Financial Plan

Download a sample daycare business plan

Daycare Business Plan Summary

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