With both parents working outside homes to provide a good lifestyle to children, preschoolers living in nuclear families can feel left out. While some parents choose to hire a babysitter or nannies, close to 20% of children attend daycare services. The modern parent requires that the place is safe and comfortable, and can easily accommodate the child’s needs.

Thus, creating massive opportunities for those looking forward to starting a daycare business. Not only can a childcare business be financially rewarding, but it will also give you immense emotional satisfaction. So, if you are still wondering how to start a daycare business, we are here to solve all your doubts.

All you need to do is read this blog and follow the steps.

What Is A Daycare Business?

A childcare business or daycare is where parents drop off their children before leaving for work and pick them up after their workday. Caretakers at daycare centers ensure that children are educated, taken care of, and engaged in fun activities. Some daycare services also offer food to the children. The psychology behind the same is to give children a homely environment. Thus, such places are often redecorated with child-friendly designs and special care is taken to ensure safety for children.

9 Steps to Starting a Daycare Center

Steps to Starting a Daycare Center

Coming to the part on how to start your daycare, here are a few steps that will put your own daycare business in the right gear. While there is no right or wrong way to start your business, having a process will simplify your job to a great extent and you will learn lessons along the way.

1. Know About Licensing Requirements

If you started as a nanny or a babysitter and are looking forward to transitioning into the daycare business, you will need to meet daycare licensing requirements. Thus, guaranteeing that you don’t fall into legal trouble. A good way to ensure that you have fulfilled all needs is to contact your local childcare licensing agency and know about their specific regulations. Additionally, you will be requiring a CPR certification and a clean driving record. This will reinforce your commitment to offering quality childcare support.

2. Draft Your Daycare Business plan

Whenever you start any business you will need to have a plan with tangible goals. You will need to have clarity on your services, have a structure for your business, streamline operations and procedures, and look after your staffing needs. Achieving all this will help you keep your business on track, manage your employees well, and even secure funding in the long run.

3. Find A Suitable Location

You can choose to run your daycare from your home. However, if not, pick up a suitable location for your childcare center. Multiple churches, schools, and recreational centers offer spaces for a fixed monthly fee.

You can search for these places online, and float a message in community groups. Once you find a good place you will need to check with local licensing requirements to make sure the location fulfills compliance regulations.

This will help you stay compliant and not run into legal troubles. We suggest finding a central location that is accessible and child-friendly. Step in a parent’s shoes and think about what they might need for your child. While you might not find the perfect option on the first go. However, you will be able to refine it over time.

4. Set A Budget

Multiple daycare businesses never see success due to poor money management. Thus, a basic understanding of accounting is a must as it will help you manage your expenses and plan your investments better. Managing business finances is much more than tracking revenue.

You will also need to plan taxes and also plan on fund allocation. Accounting solutions can come to your rescue here. They will help you send invoices, manage expenses, track revenue, generate reports, and much more. Moreover, these tools will help you send automated reminders to parents in case of late payments.

5. Use A Good Invoicing Tool

Use A Good Invoicing Tool

Just like your daycare services are suited for children’s needs, so should you be your invoice. It should detail the services you have provided and should do justice to your work. We suggest investing in a tool that offers daycare invoice templates, time-tracking facilities, automated quote generation, and receipt management functionalities.

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6. Get Your Daycare Business Insured

Your daycare center will need to be insured to keep children and your business protected. Usually, policies ensure worker compensation, liability coverage, and business insurance. If you are not sure what insurance will be apt for your business, you can check with the nearest licensing officer and get the right guidance.

7. Put Together Your Daycare Center

Now that you have a place and supplies ready for your business, you will need to prepare your daycare center. The first thing you need to do is get your facility sanitized and cleaned. The second step is to make sure your daycare is childproof. The last step is to lay out toys and set up other equipment. Make sure you use the right equipment to keep your materials organized. You can keep changing layouts to keep the freshness alive.

8. Hire Staff

As your daycare business grows in size you will require caretakers to help and take care of kids. Also, you will need to follow the required staff-to-children ratio as defined in state licensing requirements. The most important thing you need to do is get a criminal background check for all your staff to ensure the safety of your children. Your hiring decisions need to be taken with precision to maintain a rock-solid reputation and keep your facility safe.

9. Market Your Daycare

Last but not least, you need to promote your daycare centers in front of the right eyes. You will need to make a strategy to boost your business on Instagram, Facebook, LinkedIn and offline channels.

Not only can you post information about your day-to-day activities, but you can also collect testimonials from parents to build trust in your customers. Another way to get access to opportunities is to use targeted hashtags on Instagram and LinkedIn to grab the right eyeballs.

As your client size grows, you can even invest in paid ads or hire a digital marketing agency to manage your presence online. This will help you attract new clients and outlast local competitors.

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How Much Does It Cost to Open a Daycare Business?

How Much Does It Cost to Open a Daycare Business

Starting your own childcare business can cost up to 10,0000 USD- 50,000 USD. The factors depend on the location and services being offered. If you are short on funds, you can get access to multiple grants and loans available for childcare businesses. You can also tie up with local businesses that can offer financial incentives to add your daycare business plan.

Benefits of Opening A DayCare Center

Starting a daycare business will bring in personal satisfaction and of course, good revenue if procedures are followed properly. Now that you know how to open a daycare, let’s know about the benefits of opening one.

1. Financial Freedom

Opening a daycare business means you can control your income and be dependent on a single paycheck. Not only will you earn more money, but you can also invest it back into your own business.

2. Spend More Time With Your Children

If you are running your childcare and also need to take care of your children, you can heave a sigh of relief. This will not only offer your kids a warm environment but will also let them focus on their work minus the guilt.

3. Tax Deductions

As a daycare business owner, you can write off some expenditures as business expenses and save a ton on taxes. These include your housing payments, vehicle bills, childcare supplies, and even cell phone bills.

Wrapping Up

With a defined roadmap on how to start your own daycare, you can set the foundation for starting your business. As you expand your daycare operations, you will need to invest in tools that ease your operations. Solutions like Moon Invoice will help you fulfill all your billing needs and send customized invoices to your customers. With multiple daycare invoice templates, time-tracking facilities, and seamless integrations with payment networks, you are in for a lifetime experience.


Jayanti Katariya
Jayanti Katariya About the author

Jayanti Katariya is the founder & CEO of Moon Invoice, with over a decade of experience in developing SaaS products and the fintech industry. He holds a degree in engineering. Since 2011, Jayanti's expertise has helped thousands of businesses, from small startups to large enterprises, streamline invoicing, estimation, and accounting operations. His vision is to deliver top-tier financial solutions globally, ensuring efficient financial management for all business owners.