Essential business advice for family child care providers, by Julia Granata

Julia Granata, All Our Kin's Financial and Business Coach

Julia Granata, All Our Kin’s Financial and Business Coach

For the past two and a half years, Julia Granata has been supporting All Our Kin’s family child care providers in planning and running sustainable and profitable small child care businesses. She’s an expert in overcoming the specific business challenges providers face. If you’re a provider looking for great strategies to support your business, read on!

1) Balance 3 Hats

Providers wear many hats when running a child care business: Educator, Entrepreneur, and Business Manager. Each hat has responsibilities that are essential for having a sustainable business in the long run: the Educator provides caring love to children in order to help them develop to their full potential; the Entrepreneur has a vision of where the business should go; and the Business Manager takes care of daily operations regarding regulations, policies, and running the business. A child care provider has to be able to balance these roles in order to have a successful business.

2) Contract and Policies

Establish a formal and mutually respectful relationship with parents from the beginning. Here are several steps you can take to help parents understand that you have a business to run and should be respected:

-Keep money matters (in a contract) separate from regulations and procedures on how you run your business and what parents should expect of your program (in a handbook).
-Write your policies and procedures clearly and review them at least once a year with parents. This will help you better enforce your regulations and also check if policies need to be updated.

3) Have an Income Goal

In order to achieve a goal, you need to set it! Think about how much you would like to earn from your business. Then, check if the price you are charging covers your monthly expenses and leaves money for obtaining your income goal.

You should establish a realistic goal. Think about enrollment, the quality of your service, how long you have been in business, investments you need to make, etc. You might not reach your income goal as soon as you open your business, so it may help to consider achieving it progressively.

4) Prepare a Business Concept

You should have a clear idea of the philosophy of your child care program and be able to express it in an attractive and organized way. You should explain this business concept every time a prospective parent speaks with you over the phone or in person.

5) Advertise your business using more than one method

Advertise your business in every possible way–not just through 2-1-1 Child Care! Use traditional materials, but also be sure to have an online presence.  Most people looking for child care programs will be looking online.* My advice for online marketing:

-Create a website and/or Facebook page for your child care program.

-Use target websites (including Facebook, websites aimed at specific audiences, Google Maps, Child Care Listing sites, etc.) to promote your business.

-Make sure that each target site lists your website and Facebook page. Do not include an email address if you do not use your email or check it very infrequently.

* If you need convincing, think about whether you know many people who do not have a smartphone. My bet is that you know only 1 or 2 people, if any. This means that almost everyone is online nowadays!

6) Pay taxes, but not more than required

Track ALL of your business expenses. As long as the expenses you are tracking are necessary and ordinary for your business, they are deductible. If you deduct more, you pay fewer taxes. One dollar at a time adds up to many dollars at the end of the year.

7) Have an accounting system

An accounting system helps you track your income and expenses. If you have one, it will take you no more than 10 minutes a week (or every 2 weeks) and you can save a lot of time, money, and stress. I recommend using All Our Kin’s Accounting System for Family Child Care Businesses, which we’ve designed specifically for child care providers considering the specific rules for child care businesses.

If you don’t know how to use a computer, don’t use a computer-based accounting system right away. Remember that the main purpose of a system is to understand your business. Start by tracking your income and expenses using pencil and paper, next learn how to use a computer, and then transition to a computerized system.

8) Plan ahead!

If you know more or less what your income and expenses are, create a budget. A budget will help you to improve your money management and decide when it is a good time to buy items for your business or go on a vacation. It will also help you better understand the seasonal cycles of your business (particularly on school breaks, when your cash flow can be very different from the rest of the year).

9) Focus on your program’s quality

Improving your program quality means that children will have the nurturing, educational experiences they need, and it also will help your business. Parents love to talk about the development of their child, and if they realize that you are supporting their child’s development they will love to talk about the wonders of your program. Word of mouth is an incredibly important way of increasing enrollment. If you’re looking for advice, contact All Our Kin’s Educational Consultants.

10) Seek help

There are many challenges to running your own child care business. Look for your strengths and weaknesses, and seek help from experienced providers and All Our Kin! We’re here to support you. You should also participate in All Our Kin’s Entrepreneurship Series, which has a recently redesigned curriculum. Even if you already took the Entrepreneurship Series once, it can be very helpful to return to the class and revisit business concepts that will help you develop a sustainable child care business.

Graduates of All Our Kin's Business Series in Bridgeport

Graduates of All Our Kin’s Business Series in Bridgeport

Want more business strategies for managing your family child care program? Check out Developing Your Family Child Care Business from the Ewing Marion Kauffman Foundation. It contains many of these concepts and more! You can also visit Redleaf Press, which publishes great resources for early childhood professionals, and explore Tom Copeland’s excellent blog for family child care providers, “Taking Care of Business.”

This entry was posted in economic development, economic development, economics, family child care, professional development and tagged , , , , , , , . Bookmark the permalink.

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