A daycare business plan? You might be thinking it’s a waste of time. You may not have a business degree. You may have never taken a marketing class in school. You’re just a hardworking parent who thinks daycares in your area aren’t doing enough or that you could do it better. You may be right! But a basic business plan for your preschool or daycare can help guide you in your development as you build and grow your business.
1. Save Time and Money
Who wouldn’t like to have more money? What if a few extra Benjamins just magically appeared in your wallet after you finished writing your business plan? Okay, that won’t happen. But, thinking critically about the steps before you officially open your doors can help save you plenty of money down the road.
Let’s say you find a great deal online: 10 drop-side cribs for just $200 in “like-new” condition. You think “What a score!” Because you didn’t do your research and strategically plan for purchases like cribs and furniture, you buy these cribs that are actually incredibly dangerous. In fact, since 2012 it has been illegal to manufacture, sell, or even donate drop-side cribs in the United States. When the inspector comes to your facility, they tell you that you must replace the cribs with items approved by the Consumer Protection Safety Commission.
There are many rules and regulations, especially when it comes to supplies, within a child care facility. Taking the time to think about simple tasks can save you big in the long run.
By writing a business plan, you will be forced to think about various expenses you will incur while setting up and running your business. You will have to be able to make educated projections and forecasts. It will help you think about how to manage your revenue and make sure your business actually makes money.
2. Stay Focused on Success
Success can be measured in a number of ways within a child care center. However, if you fail to manage your financial and operational success, you won’t be able to afford to keep your doors open. Setting clear goals for attendance and capacity will help you make sure you have enough students enrolled in your care facility to keep you operational.
Think of your child care business plan as a blueprint. You’ll be able to map out what you think your business should earn, the expenses you think you’ll incur, and opportunities to take advantage of. By creating a business plan for your daycare or preschool you’ll have a better idea of how you are tracking toward your end goals and will be able to better react to changes or pitfalls if they arise.
3. Secure Financing for your Daycare
A vast majority of the people who will be interested in investing in your daycare will want to see your business plan. Lenders will want to see that you’ve strategically thought about your child care center as a business. Seeing a business plan will help them feel more confident about your child care’s success.
Your passion and experience are important, but a business plan shows that you have thought about the stages of growth that will help mitigate financial risk and maximize the return on their investment. Critical thinking will be required, and this plan will help to prove that your ideas are feasible. Additionally, having a business plan is a licensing requirement in many states.
4. Plan for the Future
Within your business plan, there should be a section aimed at the future of your company. Do you want to expand beyond your first location? Do you want to potentially franchise your business to others who are interested in starting a daycare? Perhaps you just want to think about retirement. Writing a business plan will help you stay focused on the goals you have for yourself and for your business. These projections aren’t set in stone. They do, however, keep you running in the right direction. Understanding where you want your business to be in the next three, five, and ten years will help you make better decisions each day.
5. Daycare Marketing Strategy
It’s extremely important to understand your potential customer base. If you don’t understand the needs and desires of your clientele, being successful will be nearly impossible. There is a high probability that you will not be the only child care option in your city. Parents will have choices when it comes to selecting a daycare or preschool. How will you set yourself apart?
There are sections of a business plan that outline the differentiation from your competition. Is it proximity because there aren’t any other child care centers in the surrounding area, and new residential communities are being built? Is it quality because you plan on offering a premium school with superior teachers and facilities? Is it price because you can offer an alternative for people looking for a lower-cost option? Maybe you’ll be open later or earlier for parents that work non-traditional hours. It could be a certain teaching methodology or curriculum that your research shows that parents in the area care about. Creating a business plan for your preschool will force you to truly understand what it will take to be successful, and any investor or lender will also want to know that you understand your demographic and competition.
By the end of the plan, you should be able to clearly describe why your business has a great chance to be successful and you’ll know what kind of marketing messages will resonate with the parents you seek as customers.