The fees you charge will provide the financial base for your company and your income. They need to be competitive in your market, reasonable and affordable for the parents, and also fair to you. You need to consider a variety of issues, including your costs, the profit you want to make, the going rates in your area and what the families you're targeting can afford. Setting your rates, explaining--and often justifying--them to parents and then collecting the money are all part of being in the child-care business.
Since you'll be offering a carefully planned curriculum that is far more than a mere baby-sitting service, you are justified in establishing a fee structure similar in design to a private school. A one-time enrollment charge of half a week's tuition will hardly raise an eyebrow, but it will compensate you for the cost in time, paperwork and special attention each entrant needs.
Calculating how much to charge for space in your center will be based primarily on three variables:
- Labor and materials (or supplies)
- Overhead
- Profit
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A fourth factor uncommon to most businesses but significant for a child-care center is the limit to the number of children you can accommodate. In most fields, if your business grows, you just keep hiring employees to serve the increasing number of customers. But in child care, state laws and practicality limit the number of children you can accept, putting a lid on the income potential of your business. To overcome this, successful child-care center operators often open more locations in nearby areas to increase their client base and income.
Forms of Payment
You'll receive payments by check and cash, and you may also want to set up a merchant account so you can accept credit cards. Check with your bank or the different credit card companies for information on accepting credit cards. Many child-care and transportation service providers find that automatically debiting parents' credit cards is the easiest way to obtain payment. "An automatic charge every month is the easiest way to get your money," says Yvette B. "There are discount fees involved, but it's well worth it."
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