How to Start a Group Daycare

A group daycare is a day care service that provides child care to 7 to 12 children on a regular basis with no more than six children under the age of two. A group daycare is regulated by the state in which it is operated, so rules and regulations may vary from place to place. When starting up a group daycare, there are many details to consider. You'll need to decide how to structure your business, how to fund start-up costs, where to procure supplies, how to advertise, and how to track expenses and profits.

Difficulty: Moderately Easy

Instructions

1. Check your state's business office for licensing and business registration information. Although every state works differently in regards to licensing and business registration, they all operate under the same principles. The state is responsible for regulating daycare centers, so state workers will require information about your business and perhaps check your criminal past. You also need to register your business with the state. You can register as a sole proprietorship, an LLC, a corporation, or a partnership. With a sole proprietorship or partnership, you may personally be liable for debts incurred by your business or your business partners. Ask a tax lawyer about the appropriateness of each business structure for your particular situation.

2. Decide how you will procure equipment for your daycare. Your state will have regulations regarding what equipment you must have for your daycare, depending on the ages of the children you intend to care for. If you don't already have a great deal of equipment such as high chairs, changing tables, age-appropriate toys, cribs, and other items, you will need to figure out how to obtain them. Some items can be purchased second-hand, through stores or from individuals. Others should be bought new. In some areas, particularly where there are daycare shortages, you may be able to obtain a grant for start-up costs. Contact the local Department of Health and Human Services about information for grants.

3. Develop your pricing strategy. First of all, you need to find out what the going rate is for daycares like yours in the area. Call around to daycares and find out how much they are charging. Once you have discovered the price range for daycares in your area, think about whether your daycare offers any benefits not offered by most daycares. For example, if yours is the only daycare in town that is open until 8 pm, you can charge slightly higher rates. However, if there are a lot of daycares in your area, you'll have to price yourself under the mean in order to get new customers.

4. Develop your marketing plan. Even if you have your license and all of your equipment, your daycare will never get off the ground until you have customers. When developing your marketing plan, consider your circumstances. If you have a lot of friends and acquaintances in the area who need daycare, you may need to do nothing more than spread the word that you are opening a daycare. However, most daycare owners need to do a bit more work. Consider sending out a direct mailer, creating a website, having a professional banner printed to hang outside your home or daycare, printing business cards to hand out, ordering decals or bumper stickers, or having an open house.

5. Hire staff for your daycare if you have enough children to warrant more help. Hiring for a daycare can be difficult. Turnover is high, and it's sometimes difficult to tell enough about a candidate from an interview to know whether or not the person is good with children. Advertise for the position in a local newspaper or online. Call vocational schools and ask for recommendations. Consider participating in job fairs or putting up flyers at schools that offer child development programs. Offer subsidies (discounts on tuition) to employees who bring their children to your daycare.

6. Keep track of your budget. Once your business is up and running, make sure you keep careful track of your expenses and income. This will help you on your taxes and help you to see where you need to make adjustments. A computer accounting program is best for this, and there are many great programs on the market. There are even some software programs developed especially for daycare businesses.