business plan day care

Daycare Business Plan Template

Written by Dave Lavinsky

Business Plan Outline

• Daycare Business Plan Home
• 1. Executive Summary
• 2. Company Overview
• 3. Industry Analysis
• 4. Customer Analysis
• 5. Competitive Analysis
• 6. Marketing Plan
• 7. Operations Plan
• 8. Management Team
• 9. Financial Plan

Daycare Business Plan

You’ve come to the right place to easily complete your daycare business plan.

We have helped over 100,000 entrepreneurs and business owners create business plans and many have used them to start or grow their daycares.

How To Write a Daycare Business Plan & Example

Below are links to each section of your daycare business plan template:

• Executive Summary – This is a brief overview of your daycare business plan. The executive summary should be no more than 2 pages long, with brief summaries of other sections of the plan.
• Company Overview – This is where you provide a business description, including your company history, business structure, and any pertinent information about the daycare center.
• Industry Analysis – The industry analysis describes the daycare industry, including market size and trends.
• Customer Analysis – This section of your daycare business plan describes your target market and potential customers. You will detail the demographics, needs, and wants of your target audience and how you plan to meet those needs.
• Competitive Analysis – The competition in your local area will be described here, along with how your daycare business will compete in the market.
• Marketing Plan – Your marketing plan will describe your daycare’s marketing strategy, including your advertising and promotion plans.
• Operations Plan – This section of your business plan describes how your daycare will be operated on a day-to-day basis. It may also include your long-term plans for expansion and the milestones you want to achieve to get there.
• Management Team – The management team section of your business plan should describe the experience and qualifications of your management team including the director, teachers, and support staff.
• Financial Plan – The financial plan section of your daycare business plan should include your financial statements, such as your income statement, balance sheet, and cash flow statement.

Next Section: Executive Summary >

Daycare Business Plan FAQs

What is a daycare business plan.

A daycare business plan is a plan to start and/or grow your daycare business. Among other things, a good daycare business plan will outline your business concept, identify your target customers, present research about the child care industry, detail your marketing plan, and provide your financial plan.

You can  easily complete your daycare business plan using our Daycare Business Plan Template here .

What Are the Main Types of Daycare Businesses?

There are different types of daycare businesses that parents can choose from for their child's needs. A traditional daycare center is most sought after by working parents since it provides child care during regular work hours. There are also in-home daycare centers that are licensed to provide child care in a home setting with fewer children. Other child care centers provide hourly care services by trusted babysitters or nannies and are operating on an as-needed basis.

What Are the Main Sources of Revenues and Expenses for a Daycare Business?

The primary source of revenue for a daycare business is its child care services.

Some key expenses for a daycare business is rent, salaries for staff, utilities and snacks expenses for the children.

How Do You Get Funding for Your Day Care Business Plan?

A daycare or child care center is typically funded through small business loans, personal savings, credit card financing and/or angel investors. This is true for a business plan for daycare or a childcare business plan.

What are the Steps To Start a Daycare Business?

Starting a daycare can be an exciting endeavor. Having a clear roadmap of the steps to start a business will help you stay focused on your goals and get started faster.

1. Develop A Day Care Business Plan - The first step in starting a business is to create a detailed child care business plan that outlines all aspects of the venture. This should include market research on the childcare industry and potential target market size, information on the services you will offer, marketing strategy, pricing strategies and detailed financial projections.

2. Choose Your Legal Structure - It's important to select an appropriate legal entity for your daycare business. This could be a limited liability company (LLC), corporation, partnership, or sole proprietorship. Each type has its own benefits and drawbacks so it’s important to do research and choose wisely so that your daycare business is in compliance with local laws.

3. Register Your Daycare Business - Once you have chosen a legal structure, the next step is to register your daycare business with the government or state where you’re operating from. This includes obtaining licenses and permits as required by federal, state, and local laws. 

4. Identify Financing Options - It’s likely that you’ll need some capital to start your daycare business, so take some time to identify what financing options are available such as bank loans, investor funding, grants, or crowdfunding platforms. 

5. Choose a Location - Whether you plan on operating out of a physical location or not, you should always have an idea of where you’ll be based should it become necessary in the future as well as what kind of space would be suitable for your operations. 

6. Hire Employees - There are several ways to find qualified employees including job boards like LinkedIn or Indeed as well as hiring agencies if needed – depending on what type of employees you need it might also be more effective to reach out directly through networking events. 

7. Acquire Necessary Daycare Equipment & Supplies - In order to start your chlidcare business, you'll need to purchase all of the necessary equipment and supplies to run a successful operation. 

8. Market & Promote Your Business - Once you have all the necessary pieces in place, it’s time to start promoting and marketing your childcare   business. This includes creating a website, utilizing social media platforms like Facebook or Twitter, and having an effective Search Engine Optimization (SEO) strategy. You should also consider traditional marketing techniques such as radio or print advertising to reach your target audience.

Learn more about how to start a successful daycare business:

• How to Start a Daycare Business

Where Can I Get a Daycare Business Plan Example PDF?

You can download our daycare business plan PDF template here. This is a business plan template you can use in PDF format.

How to Write a Business Plan for a Daycare: Complete Guide

• January 30, 2023

👇 Check all our resources on daycares 👇

Whether you’re looking to raise funding from private investors or to get a loan from a bank (like a SBA loan) for your daycare, you will need to prepare a solid business plan.

In this article we go through, step-by-step, all the different sections you need in your daycare business plan. Use this template to create a complete, clear and solid business plan that get you funded.

1. Executive Summary

The executive summary of a business plan gives a sneak peek of the information about your business plan to lenders and/or investors.

If the information you provide here is not concise, informative, and scannable, potential lenders and investors will lose interest.

Though the executive summary is the first and the most important section, it should normally be the last section you write because it’s the summary of the different sections included in your business plan.

Why do you need a business plan for your daycare?

The purpose of a business plan is to secure funding through one of the following channels:

• Obtain bank financing or secure a loan from other lenders (such as a SBA loan )
• Obtain private investments from investment funds, angel investors, etc.
• Obtain a public or private grant

How to write an executive summary for your daycare?

The executive summary of your daycare business plan should include the following important information:

Business Overview

Introduce your company (its name, its mission) and the history behind it: why did you decide to create a daycare in your area today? Why you? 

Also, that’s where you should expand on the business: where will the daycare facility be located? How old are the children you target? How many children will you be able to take care of? What are the amenities (classrooms, playground, cafeteria, etc.)? 

Market Overview

Provide here a deep market analysis that backs your decision to open a daycare business in your area today. Why would your business succeed given current market conditions? 

For example, the market analysis should include information like: what are your competitors in the area? What are their characteristics, strengths and weaknesses ? Who are your target audience (parents and children)? Is that in line with the demographics in your area?

Management & People

Who is the management team? What is your/their experience in the daycare industry?

Financial plan

What is your expected revenue and profitability for the next 5 years? When do you expect to break-even? Simply include here a chart of your key financials (e.g. Revenue, Gross Profit, Net profit )

Funding Ask

What loan/investment/grant are you seeking? How much do you need? How do you intend to spend the money?

Daycare Financial Model

Download an expert-built 5-year Excel financial model for your business plan

2. Daycare Business Overview

The business overview section of the daycare business plan summarizes the basics of your facility, including the background information, business model, services, target audience, and legal structure. 

a) History of the Project

When you launch a daycare business, you want it to grow and even become the best in the region if possible. One small element that can catalyze your company’s growth is its history. You don’t have to exaggerate the information here, but try to include useful details that will make your daycare business stand out. 

For a business as sensitive as daycare, trust overrides anything else. So, make sure to include in your business plan your experience and passion for children to demonstrate to investors you are qualified and the right person to successfully run a new daycare facility.

Also, flesh out the history behind the project: why are you starting a daycare now? For example, you may have noticed a lack of child care services for toddlers and infants in the city.

b) Business Model

Next up is the business model. This is the revenue-generating plan that identifies how your business operates. A daycare business model should be succinct and address specific things about the business. 

For instance, is it a commercial daycare facility or a family daycare? Is it an independent facility or a partnership? And should you opt for a daycare franchise? 

Keep in mind that daycare facilities vary by the target age group. So, you can opt for a childcare center, a family daycare, a kindergarten/pre-school, or a nursery school.

c) Daycare Services

It takes a lot to raise a child. So, be clear on the services you want to offer in your newly founded daycare facility. The quality of services will make your business more attractive. But an even bigger factor will be the type of services you provide at the facility.

Indeed, a lot happens inside a daycare facility, from hands-on learning (classrooms, private tuition) to field trips, games and community events. 

d) Pricing Strategy

Age is a key factor when setting the prices of your daycare services. On average, parents across the US pay about $9,400 per year on child care per child. Of course, the actual figure will vary based on a number of factors, but this is a great starting point when getting into the industry. 

An accurate pricing strategy can help you outshine your biggest competitors. However, don’t forget that setting cheaper prices isn’t necessarily the best strategy, just in the same way overpriced services may turn off potential clients. 

e) Target Audience

Daycare centers are so named because they are about a child’s well-being. However, the final decision rests with the parents, who must buy into your idea and long-term vision for the facility. 

For this type of business, you have a definite target market . And all you have to do is ensure your facility is closer to a busy neighborhood with many children. Find out if the families truly need child care services, why they need these services and the children’s average age. 

Finally, make sure your services are aligned with your target audience. For example, you wouldn’t necessarily succeed with a daycare operating 9am – 4pm in an area where parents typically work long hours in the city and need time to commute back to their neighborhood to pick up their kids.

Same goes for pricing: if you offer high-quality expensive daycare services, make sure your daycare is either located close to offices or in an area where affluent parents work or live.

f) Legal Structure

Finally, your business overview section should specify what type of business structure you opt for. Is this a corporation or a partnership (LLC)? Who are the investors? How much equity percentage do they own? Is there a Board of Directors? If so, whom? Do they have experience in the industry?

3. Daycare Market Overview

In the market overview section of your business plan, you must cover 2 important areas:

• Market trends : how big is the daycare industry in your area? How fast is the market growing? What are the trends fuelling this growth (or decline)?
• Competition analysis : how many competitors are there? How do they compare vs. your business? How can you differentiate yourself from them?

a) Daycare Market Trends

How big is the daycare industry in the us.

It’s always helpful to base your business decisions on the latest trends in the US market. For instance, the US daycare market had a value of approximately $54.3 billion in 2019 . And it is projected to grow at an annual rate of 3.9% from 2020 through 2027. 

According to reports, the high number of parents occupying full-time and part-time jobs is a major driving force behind the increasing demand for daycare services. No matter how you look at it, these statistics make the daycare business even more lucrative, provided you get all the basics right through your business plan. 

How big is the daycare industry in your region?

After the US, assess the size of the daycare market in your city or area. Focus on the zone where you plan to offer daycare services.

Naturally, you might not be able to get the data for your specific city or region. Instead, you can estimate the size of your market, for more information on how to do it, read our article on how to estimate TAM, SAM and SOM for your startup . To give you an example, let’s assume you plan to operate in an area where there are already 10 competitors:

As we know the US daycare industry is worth $54 billion today, and there are about 230,000 child care centers , therefore the average annual turnover per child care center is around $235,000.

Now, we can safely assume that the daycare industry is worth $23 million in your area (10 centers).

How fast is the daycare industry growing in your region?

Growth is an important metric for assessing the status of the daycare industry in your region. 

Here if you don’t find information online or via your research, you can calculate growth using the total number of competitors in your area. 

For example, assuming there were 8 daycare competitors in the region in 2018, and 10 in 2022, the annual growth rate is 6% per year.

b) Daycare Competitor Analysis

At the very least, your competitor analysis should answer all the questions below:

• How many daycare businesses are the area where you plan to open yours?
• What type of daycare businesses are there: home-based vs. center-based home care, early care vs. early education & daycare, etc.
• What age range do they specialise in?
• What services do your competitors offer?
• What amenities do your competitors have (playground, classrooms, etc.)
• What’s their average price (daily rate / monthly rate)?
• What is the child / staff ratio of your competitors?

4. Sales & Marketing Strategy

For some existing daycare facilities, marketing isn’t the most important aspect of running the business. But you’ll probably have to implement a few marketing strategies at the beginning to attract the first families , especially if you’re starting a new daycare facility.

a) Daycare Market Channels

A daycare business doesn’t have diverse marketing channels like retail stores or other businesses. So, this may limit your options when it comes to new marketing channels. 

Apart from word of mouth, other marketing channels include;

• Social media
• Online listing (Google business, Facebook business page)
• Word-of-mouth

b) What are Your Unique Selling Points (USPs)? 

Daycare facilities offer pretty much the same services, and it’s not easy to stand out from the competition. However, a few factors can be useful when evaluating your opportunities in a competitive market, including:

• Target age group : You may cover a unique age group as opposed to your competitors
• Opening hours : you may offer longer opening hours to accommodate for different parents’ jobs and availabilities
• Price : Your services may be cheaper than your competitors
• Quality & amenities : Quality services and extra amenities (outdoor playground, etc.) will make your daycare facility more attractive vs. competitors
• Services : Your services may go beyond the standard hands-on learning and kid games 

5. Management & People

The 5th section of your daycare business plan should be about people. It should include 2 main elements:

• The management team and their experience / track record
• The organizational structure: what are the different teams and who reports to whom?

a) Management

Here you should list all the management roles in your company.

Of course, the amount of details you need to include here varies depending on the size of your company. For example, a small daycare business run by 1 or 2 persons doesn’t need the same level of detail vs. a large center with 50 children or more.

If you plan on running your business independently, you may write a short paragraph explaining who are the co-founders and/or senior managers (if there are any in addition to yourself). It’s important to highlight their experience in the industry and previous relevant professional experiences.

b) Organizational structure

No matter how many leadership roles there are, you should now explain how you intend to run the company from a management standpoint.

What are the different teams (management, childcare staff, cooking staff, human resources, finance, etc.)?

Note that you should include these details even if you haven’t hired anyone yet. It will show lenders and investors that you have a solid hiring and management plan to run the business successfully.

A great addition here is to add an organizational chart that list all the roles, from Directors to managers, key supervisory roles and employees. Make sure to highlight with reporting lines who manages/supervises whom.

6. Financial Plan

The financial plan is perhaps, with the executive summary, the most important section of any business plan.

Indeed, a solid financial plan tells lenders that your business is viable and can repay the loan you need from them. If you’re looking to raise equity from private investors, a solid financial plan will prove them your daycare is an attractive investment.

There should be 3 sections to your financial plan section:

• Your historical financials (only if you already operate the business and have financial accounts to show)
• The startup costs of your project (if you plan to start a new daycare facility, or add capacity to an existing daycare center, renovate your facilities, etc.)
• The 5-year financial projections

a) Historical Financials (optional)

In the scenario where you already have some historical financials (a few quarters or a few years), include them. A summary of your financial statements in the form of charts e.g. revenue, gross profit and net profit is enough, save the rest for the appendix.

If you don’t have any, don’t worry, most new businesses don’t have any historical financials and that’s ok. If so, jump to Startup Costs instead.

b) Startup Costs

Before we expand on 5-year financial projections in the following section, it’s always best practice to start with listing the startup costs of your project.

For a daycare, startup costs are all the expenses you incur before you open the space to your customers. These expenses typically include: renovation costs, equipment and furniture, etc.

The startup costs for opening a child care center depend on various factors such as the location and size of your daycare facilities, the capacity (the number of children you plan to have), the quality of the amenities, etc. 

We’ve identified that it costs anywhere between $130,000 to $490,000 to start a daycare business with 50 children . See below the cost estimates.

Note that these costs are for illustrative purposes and depend on several factors which might not fully apply to you. Let’s first start below with startup costs. 

c) Financial Projections

In addition to startup costs, you will now need to build a solid daycare financial model over 5 years.

Your financial projections should be built using a spreadsheet (e.g. Excel or Google Sheets) and presented in the form of tables and charts in your business plan.

As usual, keep it concise here and save details (for example detailed financial statements, financial metrics, key assumptions used for the projections) for the appendix instead.

Your financial projections should answer at least the following questions:

• How much revenue do you expect to generate over the next 5 years?
• When do you expect to break even?
• How much cash will you burn until you get there?
• What’s the impact of a change in pricing (say 10%) on your margins?
• What is your average customer acquisition cost?

You should include here your 3 financial statements (income statement, balance sheet and cash flow statement). This means you must forecast:

• The number of children over time ;
• Your expected revenue ;
• Operating costs to run the business ;
• Any other cash flow items (e.g. capex, debt repayment, etc.).

When projecting your revenue, make sure to sensitize pricing and the number of members as a small change in these assumptions will have a big impact on your revenues.

When it comes to the costs, consider both startup and operating costs. For more information, read our complete guide here .

7. Funding Ask

This is the last section of the business plan of your daycare center. Now that we have explained what type of daycare services your company would offer, at what price, your marketing strategy , management and people, this section must now answer the following questions:

• How much funding do you need?
• What financial instrument(s) do you need: is this equity or debt, or even a free-money public grant?
• How long will this funding last?
• Where else does the money come from? If you apply for a SBA loan for example, where does the other part of the investment come from (your own capital, private investors?)

Use of Funds

Any business plan should include a clear use of funds section. This is where you explain how the money will be spent.

Will you spend most of the loan / investment to buy the real estate and do the renovations? Or will it cover the cost of the salaries of your childcare staff and other employees the first few months?

Those are very important questions you should be able to answer in the blink of an eye. Don’t worry, this should come straight from your financial projections. If you’ve built solid projections like in our daycare financial model template , you won’t have any issues answering these questions.

For the use of funds, we recommend using a pie chart like the one we have in our financial model template where we outline the main expenses categories as shown below.

Related Posts

How Much Profits can you Make with a Daycare?

6 Daycare KPIs to Track (+ Formulas)

How To Build a Financial Model for a Day Care

Privacy overview.

How to Start a Daycare Business Plan 

A Step-by-Step Guide for Childcare Planning with Tips to Help Entrepreneurs Start Their Daycare Business

Table of contents

What is daycare and why should i start one.

• Types of Daycare Providers
• Before Starting Your Daycare Business Essential Planning Steps
• Decision Journey Map Definitions

Assess the Competition

How to start your daycare business.

• The Importance of an Execution Plan
• Execution Plan: Marketing and Sales
• Form Your Daycare Business

Get Familiar with Daycare Licensing Requirements

• Choose Your Insurance and Liability 
• How to Gain Enrollment at Your Daycare  
• Invest In Childcare Experience Software to Build Your Daycare with Less Work

Build an Expert-Level Business Plan for Daycare

The childcare industry is full of passionate, hard-working individuals. Entrepreneurs just like you are starting a daycare from the ground up. In this guide, we'll give you guidance and provide templates to build a solid daycare business plan.

According to Forbes , daycare businesses were projected to have some of the fastest employment growth of all industries through 2020. Starting a daycare is a great opportunity for aspiring business owners who have a passion for early childhood education and child development.   

‘Daycare’ is an umbrella term for various childcare options (such as Montessori, head start programs, preschool, and many more) where parents and guardians drop their children off and leave them in your care to...  

• Socialize with other children in their age group  
• Learn basic fundamentals for future academic success  
• Reach important developmental milestones

Is Starting a Daycare Business Worth It?

Starting a childcare business or franchise is profitable, emotionally rewarding, and sustainable – the need for committed childcare entrepreneurs has never been greater.   

As of 2021, there were 856,238 childcare centers in the United States. The growing popularity of childcare centers comes from the demand. Parents will always need a form of care for their kids. Plus, there’s a necessity, especially beyond COVID-19, to socialize children in an environment that fosters development.  

Types of Daycare Providers 

• In-home daycare  
• Relative care  
• Preschool  
• Independently-owned daycare
• Daycare franchises  

The Difference Between Individual Centers and Franchises  

An independently-owned daycare often has an individual owner, a center director, and possibly a few other administrative staff members – along with teachers, cooks, bus drivers, etc. The owner is typically an individual who puts their own money and savings into opening the daycare, so all business rights (name, branding, etc.) belong to them.  

Alternatively, a daycare franchise falls under a corporate brand that has made an agreement with an individual to legally establish a business – using the company’s brand or trademark. In this scenario, the franchisee usually pays an initial fee, as well as ongoing royalties to the corporate franchisor. In return, the franchisee gains the use of a trademark, support from the franchisor, and the right to use the franchisor's system of doing business (including unique business policies and procedures, such as their method for advertising or enrollment). This model can be particularly beneficial for individuals who are passionate about early childhood education but don’t know how to get started on their own.  

For example, Kids R Kids and Kiddie Academy are both successful daycare business plans in the United States. Each center operates similarly, has the same name (aside from a unique location number or city/county name), and the same branding as all locations fall under the franchisee umbrella.  

Daycare Franchise Terms

• A franchisor is a daycare company that provides its services, brand, and business operations to the individual. This may also be known as a ‘ franchise system ’.  
• A franchisee is an individual owner that is being supported by the company (franchisor). Buying into a daycare franchise makes you the franchisee.  
• The franchise refers to the legal agreement between the company and the franchisee.  
• The franchise disclosure document is the legally binding contract between the company and the individual.  

Essential Planning Steps Before Starting Your Daycare Business

1) conduct market research.

When it comes to starting your childcare center, relying on assumptions about your customers and competitors leads to wasted time, money, and effort. In contrast, businesses that conduct regular market research improve customer retention and are 76% more likely to see an increase in revenue.  

Market research is a data collection process that evaluates both consumer behavior, competitor habits, and industry trends to determine the viability of your center and build a foundation for future business operations.  

Prepare for success upfront by conducting thorough market research to understand your competition, improve communication with your target audience, and identify new market opportunities. This research should result in actual data that you can use to drive your business and marketing strategies as you launch your center.  

There are a variety of tools available to help you conduct market research - all from the comfort of your own office. Gone are the days of hiring team members with clipboards to approach consumers face-to-face. Survey Monkey, Attest, and Sprinklr all offer digital market research tools to help guide you through the process of understanding your audience, your competitors, and your industry.  

2) Determine Your Target Market

A market segment is a group of consumers that could potentially enroll at your childcare center. First, identify your daycare target market segments and determine how big each segment is.  

Be careful not to fall into the trap of defining your market as “everyone in your community.” This often leads to a ‘spray and pray’ approach to your marketing and as we know, a message for everyone really speaks to no one. When you generalize your advertising in favor of not isolating a potential consumer, you aren’t able to effectively communicate with your ideal customers – forgetting to recognize how your childcare center can appeal to them and their needs.  

A classic example is a shoe manufacturer. While it would be tempting for a shoe company to say that their target market is anyone who has feet, realistically they need to target a specific segment of the market in order to be successful. If they sell adult athletic shoes, they should be building their message to target athletes or individuals who enjoy staying active and exercising. Likewise, if you offer programs for children aged 6 months to 4 years old, you should prioritize advertising toward young adults in their 20s and 30s.  

A common strategy when identifying target markets is to use the TAM, SAM, and SOM approaches to look at market sizes from a top-down approach as well as a bottom-up approach.

Target Market Terms

This should include everyone you wish to reach.  

Example: Your entire local community.  

SAM: Your Segmented Addressable Market or Served Available Market 

This is a portion of the TAM you will specifically target because they align with your offerings.  

Example: Families with young children.  

SOM: Your Share of the Market 

This is the group of your SAM that you will realistically reach—particularly in the first few years of your center’s opening, as you may expand and grow your service over time.  

Example: Families with young children who make at least $65,000 each year in household income.  

For childcare organizations with multiple brands, schools, or programs - increasing revenue and keeping families happy is vital for growth. Your Millennial parents need a uniform, high-quality experience, regardless of location.

Standardizing business processes has a significant impact on time savings, costs, and most notably quality. In fact, standardization improves quality by   61.9% ,  on average. Create consistent  enrollment processes across all your franchise locations to ensure every family has a great experience and a positive association with your brand – leading to higher conversion success and profitability.   

To achieve consistency, your franchisees’ marketing approach and advertising material must follow all your corporate brand guidelines. Your organization should have a lead management system that supports your childcare franchise staff as they  guide families through   the decision-making journey  while also ensuring each location is delivering a consistent parent experience.  

3) Develop Your Buyer Personas

Before you begin writing your daycare marketing plan, make sure you’ve defined your market and buyer personas. Without a deep understanding of whom you’re speaking to, a daycare marketing plan will have little value.    

Audience personas allow you to dive even deeper into your target market and help you understand more than just who your customer is. These identities inform you how to communicate with your customers in a way that relates to their pain points and needs.  

Building a daycare business plan is no joke! Check out childcare business tips at a glance . 

When you understand your customer’s motivations, you can uniquely address their concerns and questions in your marketing materials - leading to increased tours, enrollments, and revenue.   

Start by listing out the various kinds of programs and classes you’d like to offer at your center.  

Then, determine who the primary decision-maker is and who the primary influencers might be in each scenario.   

Primary decision-maker : typically the individual(s) taking financial responsibility and remitting payment at your center.   

Primary influencers : are  also crucial in the purchasing process as they often have the ability to sway decision-makers.  

For example, imagine you’re promoting availability for Summer camp programs at your center. In this instance, the primary decision-maker might be the parent(s) or guardian(s) whereas the primary influencer would likely be the child who’s deciding what kind of activities they want to do this Summer.  

Audience Overview

List the audiences, personas, or segments that you want your center’s marketing and messaging efforts to reach.  

Select one audience from above and describe it to the best of your knowledge. Go beyond the traditional persona to consider motivations & behavior.  

Identify the key stages in your audience’s enrollment journey from beginning to end, knowing there may be multi-dimensional steps within a stage. Complete the table for each journey at the individual stages from the specific audience’s point of view.  

Decision Journey Map Terms & Definitions 

Stage : This refers to each stage of the enrollment journey - awareness, consideration, action, and advocacy.  

Awareness : This is when a family is first learning of your center and your brand. They are researching multiple daycare centers and eventually send an inquiry to tour your facility or learn more.   

Consideration : During this stage, a family is touring your center and may be deciding between you and 1-2 other providers. Tip: Proactively equip your staff with key talking points so they can highlight your unique center features.  

Action : This is when a parent decides to register their child for care, pay fees, and is either placed on your waitlist or enrolls.  

Advocacy : After a successful, happy experience, this parent or guardian has become an advocate for your business. They’re telling friends and family about your center. This is vital for your word-of-mouth marketing strategy.  

Emotion : Identify what the persona is feeling at each stage of the customer’s journey. They may be anxious, curious, excited, or satisfied at various points. Put yourself in their shoes.  

Key Actions : What actions would a consumer take at each stage? For example, during the awareness stage, they may see your ad on Facebook, look you up on Google, or visit your website. In the consideration stage, they may call your center to get more information, look at your services online, or read reviews.  

Questions : What questions is the consumer asking in each stage? These are the questions you need to be answering for them in your advertising and marketing efforts.  

Competitive research helps you understand why customers choose your center over other alternative care options. This information provides you with insight into how your competition is marketing their services and over time, this can help you improve your own marketing campaigns and business offerings.  

Look up similar daycare centers in your area, and see what programs they offer, the type of facilities, their capacity, and their curriculum. Then, highlight the features that make your center stand out. Showcase your selling points in all marketing and advertising efforts.  Get started with these key questions...

• Who are my direct competitors and what do they offer?
• Who are my indirect competitors
• What does my competition's pricing look like?
• Do they offer promotional pricing or payment plans?
• What do they do best?
• What do they do poorly?

Download the guide to stay up to date on the latest industry news, trends and best practices for growing and managing your childcare business.

Download the Guide

Build a Daycare Business Plan

A good business plan will guide you through each stage of starting and managing your childcare organization- including how to structure, run, and grow your new business.  

There’s no correct or incorrect way to write your business plan. What’s most important is that you identify your business objectives and use this document as a roadmap for how to achieve these goals.  

A strong business plan can help you recruit business investors, gain funding, or find new partners. Prospective investors want to feel confident they’ll see a return on their investment and your center’s business plan is the perfect tool to assure potentials that working with you — or investing in your business— is a smart and profitable decision.  

Write a Day Care Executive Summary (Daycare Business Plan Outline)

Although this section is the first thing people will read, it’s advised that you write it last, once you know the details of your business inside and out. At this stage, you will be able to articulate your business more clearly and summarize all the information in a succinct, concise manner.  

Ideally, your executive summary will be able to act as a stand-alone document that covers the key highlights of your detailed business plan. In fact, it’s common for investors or loan providers to ask for just the executive summary when they start evaluating your business. If they like what they see in the executive summary, they’ll often follow up with a request for a complete plan, a pitch presentation, and more in-depth daycare business plan financials.  

As your executive summary is such a critical component of your business plan, you’ll want to make sure that it’s as clear and concise as possible. Cover only the essential components of your daycare, ensuring your executive summary is one to two pages maximum. This section is intended to be a quick read that hooks your potential investors’ interest and excites them to learn more.  

The executive summary is a tell-all first paragraph that details...  

• The city and state of your center (you can decide on the exact location later)  
• A potential open date  
• A projected enrollment count (number of full-time enrollments)  
• Programs you plan to offer  
• Ages you hope to serve  
• A quick financial summary (based on grants, funding, and potential revenue from projected enrollments)

This may seem like a lot of information upfront, but it’s simply a high-level overview of your plan.   

Conduct an Opportunity Analysis 

The opportunity section of your business plan includes information about:  

• The problem that you’re solving within your community
• P rograms and classrooms   do you plan to market your center(s) to
• How your daycare facility fits into the existing competitive landscape  

Opportunity Analysis: An Example 

The opportunity analysis portion of your business plan is important for outlining what distinguishes your daycare from your direct and indirect competitors. It details how you can continue to expand and grow your center in the future.  

Use your previous competitive research to determine your daycare business’s competitive advantage and position. Analyze potential strengths, weaknesses, opportunities, and threats. 

Problem and Solution

Describe the problem that you are solving for your customers. Childcare centers are need-oriented, meaning your consumers have tangible pain points that you must resolve to be successful.   

So, what is the primary pain point for them? Maybe it’s that busy, working parents need a caring, safe place for their child during the day, or perhaps families are seeking after-school care options for their elementary-aged children, or maybe parents need 24-hour childcare options when they’re traveling or working odd hours.   

Now, assess how they are solving their problems currently and where there’s room for improvement. If there's only one childcare center in your community and it has no open seats, you could be the solution. Or maybe there are lots of existing care providers in your city but they’re expensive or have rigid pickup and drop-off times that working parents have trouble meeting. Or perhaps there aren’t any existing childcare businesses within a reasonable driving distance of where you’d like to place yours.  

Defining the problem you are solving for your customers is by far the most critical element of your business plan and is crucial for your daycare business’ success. If you can’t pinpoint a problem that your potential customers have, then you might not have a viable business concept.  

To ensure that you are solving a real problem, try conducting your own survey with potential customers to get a better understanding of their needs and validate that they have the problem you assume they have. Then, take the next step and pitch your potential solution to their problem.

Do they agree that it’s a good fit or does it seem to fall flat?  See how to come up with a strategic plan for your business.

The Importance of Creating an Execution Plan

The execution chapter outlines how you’re actually going to make your childcare center work . You’l l address your marketing and enrollment plans, operations, success metrics, and any key milestones that you expect to achieve.  

Execution Plan: Marketing and Sales  

The marketing and sales plan section of your business plan details how you propose to reach your target market segments, how you plan on converting those target markets, what your pricing model looks like, and what partnerships you may need to make your center a success.   

Your Positioning Statement

Once you understand your audience, the first part of your marketing and sales plan is your positioning statement. Refer back to your value proposition to create a simple, straightforward sentiment, explaining where your company sits within the competitive landscape and what differentiates your venue from the alternatives that a customer might consider. This statement should be written for an investor or loan provider, rather than for your customer.  

One daycare business plan example - a positioning statement for a 24-hour childcare center in Austin, Texas may look like this:

“For the Austin-based family who is seeking childcare around the clock, Jenny’s 24-Hour Daycare is a safe option for young children with nutritional meals, best-in-industry sleeping arrangements, a clean outdoor play area, and highly trained care professionals. Jenny’s 24-Hour Daycare is the first center of its kind within 30 miles of the Austin metroplex and offers competitive pricing and tuition payment plans.”  

Use this formula to develop a positioning statement for your center: 

Your Mission Statement

Your mission statement is a scaled-down version of your positioning statement. This should be just one or two sentences that are geared toward your target consumer and describe what your business plans to accomplish. This statement usually includes company core values that explain your daycare’s purpose and how you serve your audience.  

For example, Cadence Education is a leading early childhood education provider with the mission of “providing parents with peace of mind by giving children an exceptional education every fun-filled day in a place as nurturing as a home .”  

Pricing 

Your positioning strategy will typically determine how you price your memberships and packages. There are some basic rules that you should follow when deciding on your price point:  

• Cost-plus pricing : For the most part, you should be charging your customers more than it costs you to host them at your center to ensure your venue is profitable and appealing to investors.  
• Market-based pricing : Look at what your competitors are charging and then price based on what your audience is expecting.  

Strategic Alliances

As part of your marketing plan, you may wish to collaborate with other organizations such as local camps, after-school programs, pediatricians, or even other childcare centers that don’t offer the same activities that you do.   

This partnership should benefit both of you – it may help provide access to a target market segment for your venue while allowing your partner to offer a helpful recommendation to their customers. If you’ve already established an alliance, it’s important to detail that in your business plan.  

The operations section is all about how your business works. This portion details the essential logistics such as staffing and sourcing and fulfillment. But remember, your goal is to keep your business plan as short as possible, so too much detail here could easily make your plan much too long.  

Milestones and Metrics

It’s critical that you take the time to look forward and schedule the next critical steps for your business. Investors will want to see that you understand what needs to happen to make your plans a reality and that you are working on a realistic schedule.

Then, determine how you will measure the success of each milestone by listing out the key performance indicators and metrics needed to see progress. These will be the numbers you monitor on a regular basis to evaluate the trajectory of your business. For example, you may look at how many families tour your center each week, how many children you enroll each month, or the amount of revenue you bring in per quarter.  

Company and Management Summary

The structure of your staff and teams sets your daycare up for success. In a new daycare center, there’s typically an owner (or franchisee), a center director, staff members, an enrollment or marketing team, accounting/administration, teachers, assistants, cooks, bus drivers, and janitorial staff. For example, the average small daycare business plan includes 8-10 fully licensed and/or certified early education teachers.

Financial Forecasts  

A typical financial plan will have monthly sales and revenue forecasts for the first 12 months, and then annual projections for the remaining three to five years. Break your sales forecast down into several rows, focusing on just high-level buckets at this point.   

Knowing how much your daycare will cost to open ahead of time can save you money, stress, and time. Daycare business plan start-up expenses vary by size, enrollment capacity, and miscellaneous needs.

Keep in mind that you can save on staffing costs and cut down on overhead with technology that helps to streamline your center’s operations. After all, 40% of Millennials prefer self-service over human contact when interacting with businesses.   

It’s essential that you find ways to enable families to book tours and enroll online without ever having to make a phone call to the center- reducing time spent on necessary-but-manual tasks for both your staff and inquiring families.  

Finally, articulate your profits and losses based on the data from your sales forecast and your personnel plan plus a list of all your other ongoing expenses associated with running your childcare center.  

See this Formula for Financial Forecasts

Step 1 : Average cost of tuition per child x your expected enrollments x 12 (annual revenue – assuming each family enrolls their child in one of your summer programs).  

Step 2 : Daycare businesses make around 16% profit from their overall revenue, after daycare expenses. Multiply your number from step 1 by .16 to get your predicted profit.   

Example : Let’s say you plan to charge families an average of $315 per week for childcare. With that, your goal is to enroll 60 students by the time your daycare center opens. Multiply $315 x 60 x 12 (annual revenue). This should come out to $226,800. Lastly, multiply your revenue of $226,800 by .16, which equals a net profit of $36,288 per year.  

Consider Various Funding Sources

Depending on your situation, there’s both loan and grant funding in childcare. Between state tax credits, loans, and grants – there are financing options for a variety of situations.  

Review Your Tax Deduction Options

Collecting tax credits is one way to receive an annual deduction on daycare costs. Based on your state, you can claim tax credits for...  

Collect Daycare Grants for Your Business

Often, startup costs for opening a daycare are high. Certain states and counties offer grants for new daycare businesses. There are several grant options, depending on your child and family details.   

For example, there’s a Preschool Development Grant Program and a Head Start/Early Head Start grant to provide funding that expands early childhood centers and developmental programs.   

Know Which Loans Are Available to Daycare Business Owners

While grants are a wonderful option for freshly opened daycare businesses, loans are occasionally easier to come by. They’re offered widely and often have fewer requirements to qualify. Check out a few loan examples for your daycare center.   

• SBA Loans , otherwise known as Small Business Administration loans, have exceptional rates, low interest, and flexible repayment options.  
• SBA 7(a) Loans are beneficial for covering pricier equipment funds and real estate. Loans of up to $5 million are available to daycares.  
• SBA 504 Loans – these are wonderful for business expansions and involve a loan for 50% of the project cost.  

Take Actionable Steps to Bring Your Daycare Business to Life

Both Limited Liability Companies and Incorporations offer the significant legal advantage of helping to protect assets from creditors and provide an extra layer of protection against legal liability.  

The main difference between an LLC and a corporation is that an LLC is owned by one or more individuals, and a corporation is owned by its shareholders. In general, the creation and management of an LLC are considered simpler and more flexible than that of a corporation.  

Find the Right Vendors

Choosing the right suppliers for your business is essential. If your vendors aren’t reliable or don’t deliver quality products, your new center will struggle to attract families. As a childcare provider, you will likely need the following vendors at one point or another:  

• Electrician 
• Plumber  
• Food and Beverage Supplier 
• Educational Materials Supplier  
• Substitute Staffing Provider 
• Accountant  
• Childcare Licensing Consultant 
• Cleaning & Maintenance  
• Childcare Management System (CMS) 
• Customer Relationship Management (CRM) Software  
• Digital Payments Provider 
• Online Forms Software  
• Childcare Experience Software  

All states have different daycare licensing requirements. Generally, you'll follow the steps below.

1) Take a Course

Attend and complete a pre-application course (you’ll receive a certificate at the end – remember to save it).  

2) Submit Your Application

Submit your online licensing application. It'll ask for details about your business that were outlined in the executive summary.

3) Pay Fees

Pay your application fees. The fee depends on your center's capacity or the number of children you plan to enroll.

4) Complete Inspections

An inspection of your business property must be conducted.

5) Submit Your Service Payment

Register and pay for the inspection.

6) Conduct Background Checks

Submit background checks (this may also be an additional charge).

For More Information on How to Operate In Licensing Excellence, Listen to the Podcast Below

Choose Your Insurance and Liability

• Provide general liability – stay covered if your center has any property damage or injuries to third parties (children).  
• Abuse coverage protects your childcare business or franchise. If employees turn out to be abusive towards children, this policy covers defense costs and defends you against financial losses.  
• Professional liability insurance provides coverage for your business and workers if there is a neglect claim.  
• Hired and non-owned auto liability ensures everyone is covered if there is a pick-up/drop-off vehicle accident.  

*Liability requirements may vary by state.

How to Gain Enrollment at Your Daycare

From a business owner's perspective, the next step after successfully starting your daycare is to grow your center and gain enrollments.   

Begin by building a strong company culture, actively marketing your daycare center, and finding the right childcare technology to optimize your enrollment process and save time.  

See how to elevate your business plan for daycare with better waitlist management.

Create a Culture Where Staff Want to Work

A daycare center that stands out from the rest has happy staff members that want to work hard. Create a diverse employee culture that feels comfortable openly talking about situations. Provide support, patience, and room for growth. See more tips for creating a healthy and positive culture for your daycare staff .  

Market Your Center

A daycare marketing strategy starts with an achievable goal. Do you want to fill your enrollment spots? Do you want to build a waitlist? Should you focus on scheduling more tours or gaining new leads ?   

Choose a goal with measurable results. That way, you can track and analyze your marketing performance. When it comes to how to promote daycare business, marketing helps families realize you're the best childcare center on the block. Promote your centers through...

• Social media (especially Facebook – 83% of Millennials have a Facebook account).  
• Landing pages and contact forms on your website  
• Listing directories  
• Email and text marketing campaigns  
• Referrals  
• Digital advertisements  
• Flyers  
• Word-of-mouth marketing  

Tip: childcare experience software that automates the reports you need helps you to save time and improve your return on investment (ROI).  For example, a  Source of Families report shows you where your leads are coming from to optimize your efforts.

Invest In Childcare Experience Software to Build Your Daycare with Less Work  

LineLeader is revolutionary childcare software that automates lead capture, follow-up, scheduling tours, and reports. Craft  beautiful, personalized marketing campaigns to continually grow your business.  Plus, easily manage your curriculum, attendance, and billing with automated center management

Get more from your marketing while saving franchisees 10 hours every week with LineLeader. Automate everything from lead capture and reporting to center management—all from one place.

Download Your Guide

Resources to help you run your childcare business.

8 Summer Enrichment Activities for Infants & Toddlers | Activities for...

5 Activities to Celebrate Juneteenth with the Children in Your Center

4 Fun-Filled Ways to Celebrate the Fourth of July with Children

Additional resources.

For more information on specific childcare resources regarding marketing tools, campaigns, tips, and best practices - see below.

1. Learn hidden secrets no one tells you about starting a childcare business .

2. See how to operate in childcare licensing excellence to boost enrollment.

3. Beth Fiori of Tiny Treasures provides expert tips. check out ways to improve your business plan for daycare with enhanced waitlist management.

4. Discover tips to maintain the best childcare center on the block.

5. Gain advice for strengthening your daycare staff culture. 

6. Learn the benefits of building a daycare business plan , at a glance. 

LineLeader Video Resources

How to Write a Business Plan for Daycare and Preschool

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• Running a business

Writing a daycare or preschool business plan is a big task, but due diligence and hard work will help you understand what you’ll need to launch and run a daycare or preschool successfully.

What do daycare investors want?

Your local government will have rules and regulations you’ll need to follow as a small business owner and childcare provider. Start by reviewing the childcare licensing guidelines for your state and city. Once you’re clear on licensing guidelines, you’re ready to start writing your childcare business plan.

The purpose of a business plan is to help secure funding. You’ll likely need financing to launch your preschool or daycare, especially if you want to avoid the monthly repayment of a loan. 

Investors provide businesses with money in exchange for partial ownership. As a result, they expect a larger return on their initial investment. Because many investors work in business, they prefer to invest in an established company.

Most investors look for:

Industry background and experience

Financial performance and promise.

Investors want to make money. Therefore, they are more inclined to work with experienced entrepreneurs and business owners to guarantee a return on their investment. 

This might sound discouraging for those with little experience or without a business management background, but the opportunity doesn’t end there. You could consider bringing on a partner with a business background. Additionally, many investors act as a source of business advice. 

You need to demonstrate that your business will make money. Investors will likely want to see signs of business growth before they give you money. 

Additionally, investors will want to know about your financial stability. Questions an investor might ask are:

• What do you plan to do with the money?
• Has your business been up or down in recent years?
• Is your company losing money? Are there signs of growth for the future?
• How do you plan to repay your investment?

Of course, every investor is different, so they’ll consider various factors. While experience and financial promise are at the top of the list for most investors, they might also look for uniqueness, business readiness, an effective business model, and more.

Writing a daycare business plan

We’ve discussed licensing and investors. Now, you’re ready to begin the framework of your business plan for daycares and preschools. Here’s what you’ll need to get started:

Business description

Needs assessment, insurance policies, operating policies and procedures, marketing strategy.

Start with the basics: what does your daycare do? Detailing the service you’re offering will help you create a clear business plan. Next, you might want to write some goals or even a mission statement outlining your purpose and motivation.

Start by looking at general daycare or preschool industry trends, then narrow your scope to the preschools or daycares in your local area. Next, you’ll need to figure out who your target customers are and confirm that there is a need for a business like yours in your community. 

Are there a lot of young families in your neighborhood? Are you located somewhere convenient for commuting parents? Does your business offer a specific service that your competitors don’t, like early check-in or extended hours? 

Also, check out the competition. Research the existing daycare or preschool options in your community. Look at current preschool or daycare business plan samples. What makes your daycare or preschool unique? 

Developing detailed budgets will help you run your small business. You’ll need to compare your current cash flow and expenditures to determine whether you’ll make a profit.

Build a budget for unexpected costs. For example, how many children do you need to serve to be able to pay your bills and stay afloat? Child Care Aware of America offers some terrific budgeting resources for this process.

Depending on the type and size of your preschool, you’ll need insurance policies of several different types, including liability, property, workers’ compensation, and business insurance. Check the licensing requirements for guidance in building this part of your preschool business plan.

Create a comprehensive handbook for families and staff that includes you center's policies and procedures. For instance, you'll need to develop an emergency plan , daycare sick policy , and other safety protocols according to your local childcare licensing requirements. 

Your staff handbook will be a helpful resource your employees can reference and include all your employment policies including work and pay schedules, benefits, and information about professional growth and development. You can also include information on your center's philosophy and curriculum, classroom procedures, and expectations for working with children and families.

Your marketing strategy is the key to attracting customers. Decide what type of advertising you will use in front of potential customers. For example, list your school in local directories and participate in parenting and kid-friendly community events. Run a social media campaign focusing on your target population.

Another big part of childcare business marketing is differentiating yourself from other preschools. These days adopting daycare software is a surefire way to attract families with young children. A tool like brightwheel's center management feature will streamline your center's admission process, record keeping, and reporting, saving you up to 20 hours per month. 

You can also use brightwheel for recording and tracking daily events and activities, and sending real-time updates to families throughout the day. It also offers secure, digital check-in/check-out and a paperless billing system. This is a great way to keep your families looped in on daily activities and handle all of your administrative tasks in one place.

Your business is ready!

Writing a business plan can be stressful, but it doesn’t have to be. Once you secure the proper licensing, use the information in this article to guide you through creating a solid daycare business plan that drives investors and financing to your business.

These are just the basics to get you started. For further information, the U.S. Small Business Administration’s website has detailed instructions on creating each necessary part of a successful business plan. 

Childcare and Preschool Supply List

A list of everything you need to start an early education program.

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The ultimate guide to starting a daycare business.

Why Start a Daycare?

Advantages to starting a daycare, can you start a daycare from home, how much does it cost to start a daycare, 15 steps to starting a daycare center, resources for daycare owners, bottom line.

Since most parents work outside the home, most preschool aged children receive some form of child care. While many are cared for by nannies, babysitters or other family members, nearly one-quarter (23.4%) of children under age five attend an organized daycare center. 

This presents a world of opportunity for those looking to take the next step and start a child care business of their own. Starting a daycare center can be both personally fulfilling and financially rewarding.

Do you want to open your own daycare center in the U.S.? Follow along with this guide as we reveal the step-by-step process for opening a successful child care business. 

Opening a daycare can be intimidating, but it can also be incredibly rewarding. While there is no blueprint for success, many child care business owners find joy in the journey. So whether it’s your passion for kids or desire to serve parents in your community, there are many valid reasons to open a daycare. 

What’s important is that you also need to consider your own unique reasons for wanting to open a daycare, as these reasons will then motivate you to follow through on your dream. Even though you will face obstacles along the way, the payoff of opening a daycare is certainly worth the struggles.

Starting your own daycare business can be advantageous on multiple levels. For one, you’ll have the personal satisfaction of starting your own care center from scratch. Then, there’s the joy of spending time with children and learning life-changing lessons along the way.

If you’re still on the fence about starting your own daycare, consider these likely advantages:

• Emotionally rewarding: Working with kids teaches you to be patient and enjoy the simple things in life. You’ll also have the flexibility of having your own business versus being confined to a traditional day job.
• Financial freedom: By opening a daycare, you’re in control of your income rather than reliant on a typical paycheck. You can maximize your earning potential and make investments back into your own business.
• Personal child care: If you have your own child, you can care for them while you’re running your daycare. This will save you money and give your offspring opportunities to make friends with other kids. 
• Continued education: Opening a daycare can open the door to new opportunities in the field of child care. You may be presented with another job position or choose to pursue additional education of your own accord. 
• Extra money: Rather than stay home and care for your own children for free (assuming the original plan was to be a stay-at-home parent), why not make some extra money by caring for other children at the same time? 
• Tax deductions: As a business owner, you can write of certain expenses as business expenses, saving you money on your taxes. These expenses can include a portion of your housing payment (if you have an in-home daycare), your cell phone bill, your vehicle, child care supplies and more. See Tax Deductions . 

These are just a few of the many advantages of starting your own daycare center. Now let’s address some common questions you may have about being a daycare business owner. 

Yes, starting a care center from your home is an option and may even be the more affordable option. This is because there are different options at the local, state and federal level that provide grants and funding to in-home daycare centers.

If you already have the space to run a child care business out of your home, it’s worth looking into Small Business Administration (SBA) loans to help you fund your endeavor. Remember, at the end of the day, you may be eligible for tax cuts and other benefits.

According to small business website bizfluent.com , the average startup cost for a daycare center is $10,000 to $50,000. This can vary widely depending on whether you’re opening a home-based daycare or leasing a separate facility for your care center. 

If you don’t have $10,000+ in your bank account, don’t worry. There are many grants and loans available to child care businesses. In fact, some local businesses will offer financial incentives to support budding child care centers. Consider reaching out to your community for support.

Now, let’s get to the good stuff: how to start your own daycare business from start to finish!

Starting a small business in general is always a journey. While we’ve outlined a few steps to getting your business up and running, know that there is no one “right” way to achieve success. You’ll learn many lessons along the way and are likely to pave your own path.

That said, here are 15 steps to starting your daycare center, even if you have zero experience.

1. Learn About Daycare Licensing Requirements

You might have started off as a babysitter or a nanny, but in order to start a full-on daycare business, you need to meet the proper licensing requirements in order to be legal . That way, your daycare will be legitimate and you won’t run into any legal trouble accepting children into your care. 

A good first step is to contact your state’s Department of Children and Family Services (DCFS) to learn about their specific regulations for child care providers. Another option is your local area’s child care licensing agency. You can usually find this information online. 

To obtain a license to start a daycare center, you’ll also need a current CPR certification, a clean driving record and additional documents that prove your commitment to providing quality child care. Don’t be afraid to ask your local agency questions to ensure you’re satisfying all requirements.

2. Consider Taking Early Childhood Education Classes

While you don’t need to have professional child care experience to start a daycare business, having some understanding of early childhood development is strongly encouraged. You’ll be caring for young lives, so you need to know how to provide the right kind of support and care.

Getting a degree is early childhood education is a good place to start. You can typically find classes in-person at your local community college or online. Through this degree, you’ll gain a greater understanding of how children think and behave, and what they need in order to be properly cared for. 

Beyond that, you’ll have the skills to set your business apart from your competition. You’ll be better prepared to offer the services parents are looking for and keep them coming back time and time again.

3. Create a Daycare Business Plan

In starting any type of small business, it helps to have a business plan. Having a business plan helps you set tangible goals for your business, organize your business structure, outline your services and so much more.

In your daycare business plan, you’ll define your daycare’s mission statement, operations and procedures, staffing and budget. This business plan works to keep you on track and striving toward success. 

Consider how you want your business to be organized for you plan. Will you be solo or hire staff? How will you secure funding? Will you offer services beyond child care (like tutoring)? For help in creating your business plan, check out this detailed guide from the U.S. Small Business Association .

4. Find a Location for Your Daycare

If you plan on running your daycare out of your home, this step should be pretty straightforward. If not, you’ll need to find a location for your child care facility.

Many recreational centers, churches, local businesses and even schools have space available to host a daycare, typically for a monthly fee. Search online, in your local newspaper and within your network to find options in your area. 

Once you’ve found a good fit, you need to check your city’s zoning laws and licensing guidelines to make sure your chosen location is compliant. That way you can avoid some legal headaches down the road. 

Ideally, you’ll need to find a location that’s centrally located, easily accessible and child-friendly. Consider what children and their parents will be looking for in a child care center. You might not find the perfect option, but you can make it work with a little TLC.

5. Get Insurance

Most daycare centers need several types of insurance in order to keep children (and their businesses) protected. These policies typically include liability coverage, property, workers’ compensation and business insurance.

Not sure what type of insurance you need? You can always check with your local child care provider licensing office for guidance.

6. Seek Out Grants and Funding

As we covered already, there are certainly costs associated with starting a daycare. If you don’t have the money you need to cover your initial startup costs, you’ll need to get creative when it comes to acquiring funding.

There are many grants available to help you cover your startup costs. You might also consider taking out an SBA loan or doing community fundraising. Know that the goal is to use these funds as an investment that will yield profitable returns in your business.

Costs Associated with Starting a Daycare

There are several things you’ll need to buy or lease in order to get your business up and running for day one. These expenses include but are not limited to:

• Renting a daycare space
• Indoor and outdoor play equipment
• Art supplies
• Cleaning supplies
• Child care supplies (like diapers and wipes)
• Business laptop
• Licensing fees
• Food (for snacks/meals)
• Bottles, cups, plates, utensils, etc.
• Car or reliable transportation (optional)

You might think of some additional items you’d like to have at your daycare. Over time, you can use the revenue coming in to help cover these expenses and invest in better equipment/supplies. It’s OK to keep things simple and then scale your way up. 

7. Prepare Your Daycare Center

Once you have a location secured and the proper materials and equipment in place, it’s time to prepare your daycare center.

First, clean your facility and sanitize with an effective disinfectant. Then, take the needed steps to childproof your daycare according to the ages of the children you will be caring for. Follow this childproofing checklist for help.

Finally, set up play equipment and lay out toys. You might decide to use storage boxes to keep everything organized. You can always rearrange your layout according to your needs.

Is your daycare ready for service? Give it another once-over and you’re ready to open your doors for day one of business!

8. Draft up a Contract

As a small business owner, having a contract is always a good idea. The parents that come to your facility are essentially your clients, and you want to have a solid contract in place to protect yourself from any legal issues.

We recommend seeking out a trusted contract lawyer to draft up a contract according to your needs and unique business requirements. Your contract will then be used to outline your expectations for your clients and their children.

Here are some important questions to consider when creating your contract:

• How do you expect to be paid?
• How will you handle late payments?
• What time should parents pick up their children?
• Are there consequences for late pick up?
• What services will you provide?
• What is your policy when it comes to sick children?
• Do you offer refunds? If so, under what conditions?
• What happens if a child is injured at your facility?

Whether you seek help from an attorney or write the contract yourself, you should have a contract in place before accepting business. Once signed, you can then send professional daycare invoices to get paid by your clients. 

9. Establish Policies and Procedures

Establish policies and procedures for the families that attend your daycare and your staff. These procedures may include an emergency plan, safety procedures, privacy protocols and rules for your facility.

Having these procedures in place will help you keep the children safe and protect yourself from liability (in some instances). In establishing your policies, be sure to review your local child care licensing requirements to ensure compliance. 

10. Research Possible Tax Credits

If you’re opening an in-home daycare, you may be eligible for certain tax reductions based on the fact that you’re using your residence for business purposes. This means you can essentially write off a portion of your housing cost. This can be the case even if your daycare space serves as a family room after hours. 

11. Hire Staff as Needed

When you’re first getting started, you may just be a company of one, as you might want to save the cost of hiring unnecessary help. But over time, you may need to hire help to take care of the kids during the day.

This is especially true if you find yourself running up against the required ratio of staff to children, as outlined in your local daycare licensing requirements. Be sure to review these to make sure you have enough staff for the number of children you plan on caring for.

Also, make sure all child care staff undergo criminal background checks and provide references to ensure the safety of the children. Make your hiring decisions carefully to keep your facility safe and maintain a stellar reputation.

12. Market Your Daycare

You have your daycare set up and open for business, now how do you get families in the door? As with any small business, you’ll need to market yourself to attract potential clients.

There are many ways to market your daycare. One method is to create flyers and post them around your local community—at businesses, schools and coffee shops. You can also run paid ads on Google or Facebook to draw in families from your local area.

To establish your daycare as a professional business, consider building a website that provides more information about your services. A basic website can cost anywhere from $10 for a WordPress template and set up, to $2,000 or more for a custom design.

With a website, you can then use search engine optimization (SEO) to attract organic traffic from Google. That way, when families search for a daycare near them, your business is likely to show up in the search results.

13. Promote Your Daycare on Social Media

Another effective marketing tool for daycare centers is social media. Platforms like Facebook, Instagram and LinkedIn can be used to promote your business and draw in potential clients.

Create a business Facebook page to post more information about your daycare, collect client testimonials and keep families up-to-date with events at your daycare. You can also post on Instagram and LinkedIn, with targeted hashtags, to attract families in your area.

As your business grows, you might decide to invest in paid marketing services. A digital marketing agency or consultant can help you increase your business’s presence online, outrank your local competitors and attract new clients. 

14. Provide Top-Quality Care

The success of your daycare depends on you providing top-quality care to your families. If the kids at your facility are properly cared for, and, even better, enjoy coming to your daycare, you’re likely to attract more referral business.

Positive reviews can work wonders to attract new clients. Ask families to review your business on Facebook, Google, Yelp and other review sites to improve your daycare’s reputation in your community.

Always look for ways to improve your daycare. Ask families for feedback, invest in additional education and hire fantastic staff to make your daycare the obvious choice for families in your area. 

15. Manage Your Business Finances

Many small businesses fail due to poor money management. If you want your business to succeed, you’ll need at least a basic understanding of business accounting and how to manage your expenses.

Staying on top of your business finances is more than just tracking revenue in and expenses out. You’ll need to plan for taxes—typically around 30% of your revenue, after expenses—and make informed decisions when it comes to how you’re going to allocate your funds.

Professional daycare accounting software can help you send invoices, track revenue, manage expenses and more. It can even send reminders to parents for late payment and accept credit card payments with ease.

The more you know, the easier it will be to make smart financial decisions. Stay on top of your business finances so your business is not only surviving but thriving . 

Congratulations on taking the first step to starting your own daycare business—reading this guide! By now you have a general blueprint for how to start your own business and get up and running. 

Need more help getting started? Check out these reliable resources for aspiring daycare business owners:

• Child Care Aware of America: licensing guidelines for child care and daycare providers
• United States Department of Health and Human Services: childproofing checklist
• Early Childhood Training and Technical Assistance System (ECTTAS): child care resource guide
• Office of Child Care: list of state licensing agencies
• Child Care Resources Inc.: early educator training

Starting a daycare business can be challenging but also incredibly rewarding. The process is made easier by having a general roadmap for how to get started. Hopefully, this guide has provided some guidance on how to get started, plus inspiration for you to finally launch a business of your own.

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• Sample Business Plans
• Education & Training

Daycare Business Plan

With the majority of parents staying out of the home throughout the day, the daycare (childcare) business has turned into an extremely bankable one in recent years.

If you have the right resources and more importantly, are good with children. If you have ever dreamt of starting a daycare business , then you are at the right place!

Though certain sections are common to all business plans, you’ll need to customize the outline as per the needs and requirements of your business.

Industry Overview

The U.S. childcare market size was valued at USD 54.3 billion in 2019 and is expected to expand at a compound annual growth rate (CAGR) of 3.9% from 2020 to 2027.

This rise in demand has come from the increasing number of working parents. Earlier parents had to quit their careers to take care of their children, but that has changed due to better daycare facilities.

Now, if you plan on entering this competitive childcare market, you must know that the daycare business is based on the foundation of trust more than anything. Hence, providing quality services and having a clean image in the market is of utmost importance.

Studies show that a lot of daycare businesses fail in their first three years due to reasons ranging from poor management to lagging finances. You can combat all of these and many more troubles if you enter the industry with a well-rounded daycare business plan.

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What is a Daycare Business Plan?

A daycare business plan is an equivalent of a roadmap in your business journey. A plan helps you understand what you’re getting yourself into.

It helps you understand the market, figure out where you stand in it, know your target audience better, and formulate better marketing and financial strategies.

Overall, it makes your decision-making process faster and more effective and prevents you from feeling clueless at any point in your business journey.

Moreover, it also helps you get investors and helps your employees and partners understand what your business stands for. It gives the people in your business a feeling that you have a vision and know what you are doing with your business.

Also, you get to set clear goals that give you a direction to work and put your efforts in.

Why is a Daycare Business Plan Important?

Everything you do for your business should add value to it. And here’s how a daycare business plan can add value to your business:

It gives you a sense of direction

There are several ways you can go with each business decision. A business plan helps you understand what would work best for your business then.

Also, it gives a set of tangible goals to look forward to when you work on your business.

It helps you understand your target audience better

Planning your business gives a better form and structure to your research. Which at the end of the day helps you understand your customers better. It also helps you analyze what it means for your business.

Making and upgrading your product or service for your customers serves the biggest purpose at the end of the day.

It helps you understand your competition better

Imagine there’s a popular daycare center in your city and several parents swear by it. Now, this could mean several things for your business.

You’ll have to pick a different location, know the daycare service’s weaknesses and offer better services by working on that area for your business.

You can also pick the things they are doing right, and inculcate the same in your strategies.

A business plan can help you do all of the above and more through a competitive analysis.

It helps you convince your investors

Though making the right prediction is difficult, having a rough idea of your business’s sales and financial potential is important to get investors on board.

Investors want to know the scalability of your business before they invest in it. A good and realistic prediction of returns makes it easier to convince investors.

And a business plan can help you make realistic financial predictions.

It keeps you updated with the latest business trends

A business plan is a living document that grows alongside your business. It also helps you have a foresight of changing trends and act on time for getting the best results for your business.

This also makes it important for you to keep updating your plan as your business grows.

What does a Daycare Business Plan Look Like?

If you are planning to start a new auto or car repair shop, the first thing you will need is a business plan. Use our sample Daycare Business Plan created using Upmetrics business plan software to start writing your business plan in no time.

Before you start writing your business plan for your new auto repairing shop, spend as much time as you can reading through some examples of Children’s & Pet business plans .

Moreover, business plans come in different forms to fit the current state of your business.

Apart from that, there are a few major sections that should be included in every business plan.

Daycare Business Plan Outline

This is the standard business plan outline which will cover all important sections that you should include in your business plan.

• Executive Summary
• Keys to Success
• Company Summary
• Timothy Bernard Kilpatrick
• Start-up Summary
• Locations and Facilities
• Service Description
• Competitive Comparison
• Sales Literature
• Fulfillment
• Future Services
• Industry Analysis
• Market Segmentation
• Market Analysis
• Market Needs
• Market Trends
• Market Growth
• Business Participants
• Competition and Buying Patterns
• Main Competitors
• Strategy and Implementation Summary
• Value Proposition
• Competitive Edge
• Positioning Statement
• Pricing Strategy
• Promotion Strategy
• Marketing Programs
• Sales Forecast
• Sales Programs
• Strategic Alliances
• Web Plan Summary
• Website Marketing Strategy
• Development Requirements
• Management Summary
• Organizational Structure
• Timothy B. Kilpatrick
• Carolyn Steverson
• Candice Harris
• Management Team Gaps
• Personnel Plan
• Projected Profit and Loss
• Projected Cash Flow
• Projected Balance Sheet

What to Include in Your Daycare Business Plan?

A good daycare business plan consists of a certain number of well-defined sections, the following sections can help you in writing an excellent business plan.

1. Executive Summary

The executive summary section is one of the most important sections of your business plan because it not only forms the first section of your business plan but also acts as a pitch for potential investors who can provide you with funds for your daycare business.

It consists of your company’s vision and mission, its USP, objectives, and also expected revenues.

Writing the executive summary section of your plan at the very end, so you can sum up your plan properly is a good tip to remember.

2. Services

In this section, you should give out a clear idea of what your services are and whom it caters to. You should define your target market, your niche, the area your services will be extended to, etc.

As a daycare center, you should have a clear idea of the age group you will cater to, what is the preferred location of your target audience, how you come off as a service to your customers, and so on.

3. Market Analysis

Market analysis can be of great help to any business, it can help you understand what you are getting yourself into, who your competitors are, what your client base expects out of you, and where you stand in the current market situation.

Hence, market analysis immensely improves your understanding of the industry you are getting into. In the case of a daycare center knowing the best practices of childcare that exist in the market can be of great help.

4. Web Plan

In today’s internet-based world, most busy parents looking for a daycare center online. Hence, having a strong and reliable web presence is crucial to the success of your daycare business. Thus, including a web strategy in your business plan is necessary.

Always remember, as a daycare service coming off as a trustworthy and reliable institution is crucial for your business to work.

5. Management and Organizational Structure

Having a well-structured management system is especially crucial for a daycare service. It not only helps your business run smoother, but it also makes you look more responsible and reliable in front of the parents or the primary caregivers.

In this section, you should include the structure of your organization, details about people on various levels in your company, a solid system for tracking everyone’s work and progress, the areas your team is excelling at, and the areas your team is lagging in.

6. Financial Plan

One of the chief reasons for several daycare services running out of business is poorly managed finances or running out of funds to keep going.

Planning your finances in the early stages of your business saves you from encountering such a problem later on.

Hence, planning your finances is mandatory while writing a business plan.

Download a sample daycare business plan

Need help writing your business plan from scratch? Here you go;  download our free daycare business plan pdf  to start.

It’s a modern business plan template specifically designed for your daycare business. Use the example business plan as a guide for writing your own.

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Daycare Business Plan Summary

In conclusion, apart from having a good image as an organization, a well-managed team, a clearly defined niche, thorough research of the market and an excellent financial plan is crucial to the success of a daycare business.

After getting started with Upmetrics , you can copy this sample daycare business plan into your business plan and modify the required information and download your daycare business plan pdf or doc file.

It’s the fastest and easiest way to start writing your business plan.

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Upmetrics is the #1 business planning software that helps entrepreneurs and business owners create investment-ready business plans using AI. We regularly share business planning insights on our blog. Check out the Upmetrics blog for such interesting reads. Read more

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Daycare Business Plan Template

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Updated July 31, 2023

A daycare business plan is a written document outlining the mission, objectives, and strategy of a child care business. The plan can be used to guide internal operational plans as well as inform prospective investors or lenders. Typically, a daycare business plan should include an executive summary, company and management description, market analysis, and financial information.

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Legal Templates

Home Business Business Plan Daycare

Daycare Business Plan Template

Download our template and create a business plan for your daycare!

Updated September 22, 2023 Reviewed by Brooke Davis

When you are ready to start a daycare business, you need an effective plan outlining how to get there. High-quality child care is in high demand, but you must be prepared for the challenges of starting a new business.

A solid business plan will get you off on the right foot before you even open the doors of your new facility.

With these helpful tips, you can learn how to make a business plan for a daycare center. Whether you are looking to watch over young children or even need a dog daycare business plan, Legal Templates is here to help you get started.

Why You Need a Business Plan for Your Daycare Business

How to write a business plan for a daycare.

• Management Team

Daycare Business Plan Sample

A business plan sets the stage for how you will operate your business and how you will get it running. A daycare is no different. Opening a daycare requires intensive planning, legal compliance, and understanding of your market.

A daycare business plan template walks you through the steps to build a proper path forward. Every successful business is planned correctly, not as you go along.

A sample daycare business plan pdf or Word document lays it out for you. You can learn how to put it together and what you must include. Many business plans help you understand what you must do to prepare.

Some are designed to recruit potential investors to your cause. Either way, you need a business plan to prepare you for the challenges and successes ahead.

Knowing how to write your daycare business plan can be tricky without some help. You may not have done this before, but a daycare business plan example can help.

Follow these writing tips in each section to create a strong business plan for your future daycare.

1. Executive Summary

The initial section of your business plan is the executive summary. This part of your plan is an introduction for whoever reads it. It is designed to offer an overview of the remaining sections. It should be concise and add only summary details—this is not the section for intensive information or data.

The executive summary will highlight what your daycare business will look like and the most crucial section of your entire plan.

This section may provide information such as:

• A business address
• Phone number, email address, and other contact information
• List of owners
• Banking information
• Start date for the daycare
• Client base
• Market niche
• Factors for success

The executive summary lets you make a case for why your particular daycare will be successful and competitive. It is also the section that helps you sell yourself and your business to potential investors who may play a critical role in starting your daycare.

Provide a mission statement that reflects your goals for the daycare and your motivation for starting your business.

2. Management Team

Your daycare business plan should include important information about your management team. The first part of this section may address ownership of the business itself. It should outline all essential ownership details, such as:

• Legal names of every owner
• Each owner’s proportionate share
• The format of ownership percentage (i.e., stocks, capital investments, etc.)
• The format of the business (Corporation, LLC, etc.)
• Contact information for each owner

You want everyone who reads this business plan to know who has a stake and how their interests are represented. These details are a crucial part of business formation and preventing costly legal disputes in the future.

The management team section should also include the profiles of your management staff. These people will run the business daily, and they should be properly vetted before being put in charge.

Your business plan should list the management teams’:

• Names and positions
• Summary of responsibilities
• Credentials and education background
• Prior employment or experience
• Early childhood education licensing or other credentialing
• Management experience
• Salary and benefits
• Past success in a similar role

This information should demonstrate why these are the right people for the job. Not only does it help you know how your business will run, but it also shows others you have a proper plan in place for your daycare.

3. Products and Services

This section lets you talk about why you are starting this business in the first place. You will outline the services or products you intend to sell to consumers. For a daycare, it should outline the following:

• Who is being cared for: Children, elderly adults, or pets?
• Business hours
• Staff costs and required credentials
• Will you offer food, diapers, and other child-care products?
• How will you measure sales metrics

Daycare is typically considered a service, but product sales are also often a part of this model. Your plan should adequately account for how you will handle this dual purpose and how it fits into your business model.

4. Customers and Marketing

You must identify your market and how you will get customers into your daycare. This section will focus on your area’s need for daycare services and the types of customers you expect to get.

Identification of customers is a vital part of a business plan and should include details like:

• How many parents need childcare services?
• What costs can families be expected to pay for your services
• The community you will target
• Demographic data for potential customers

With your customers in mind, you can focus on your marketing strategies. You want to differentiate yourself from competitors and ensure the community knows your new business. The daycare business plan must outline how you will achieve these goals.

A marketing strategy should combine both traditional and digital marketing methods, including:

• Open houses
• Word-of-mouth advertising
• Advertisements in the paper or yellow pages
• Billboards or other ads
• Television, radio, or internet advertisements
• Social media pages

5. SWOT Analysis

A SWOT analysis will address your daycare’s strengths, weaknesses, opportunities, and potential threats. This analytical method examines your company and how it will operate.

It puts each of the four metrics into a visual matrix to help prospective business owners quickly identify favorable and unfavorable factors that may affect their business venture.

A SWOT analysis should focus on how your daycare services can perform against competitors. It may address factors like:

• Any threats the daycare may face
• Competitive advantages and why they would be successful
• Areas that may be improved over time
• Technology or resources the company may use to increase efficiency
• Internal factors that may affect economic success

Detailed SWOT sections show investors you have done your homework and give you valuable data to make informed business choices.

6. Financials

A business plan should address the unique financial situation you face. Your daycare business plan should demonstrate your break-even amounts and expected profit margins.

It will also address the costs and the areas of revenue you expect. You will want to address the following:

• Enrollment fees
• Payment plans
• Cost of supplies and materials
• Employee costs
• Regulatory costs
• Additional program offerings and revenue
• Necessary loans or capital improvements

A well-developed budget can demonstrate expected cash flows versus expected expenditures. Knowing how to handle these costs will be incredibly helpful in starting your daycare.

7. Operations

Your operational plan should outline specific procedures your business and staff will follow. It will list employees and those in management positions and their responsibilities.

As in your management section, a detailed “chain of command” is essential. Staff are an important part of your operations and should be detailed here.

One of the most important aspects of a daycare operation is its location. It would be best if you addressed the following:

• The facility’s address
• The type of area it is in (residential, commercial)
• The space available and amenities
• Why is it a prime location
• Accessibility to the community for drop-off

You should also list your business hours and the services you will have available at different times. Child daycare centers differ in when they offer care—whether during the day, evenings, or even on weekends.

If you are doing other forms of daycare, you may even utilize late or overnight hours. You can decide how you run your business, but operations should be clearly outlined in your business plan.

8. Appendix

The appendix section allows you to include other documents that add to your business plan. They may include legal documents like licensing credentials, insurance information, and business formation documents.

Additional documents in this area are meant to support your business plan. The appendix might also include the following:

• Reference letters
• Photographs of the facility, locations, or general area
• Market research data
• Compliance Requirements

The appendix is a flexible section that lets you add supporting documents and other relevant information. Only add details that are helpful to your business plan. The appendix does not need to be lengthy or filled with fluff.

Legal Templates has the daycare business plan sample you need to construct your plan. With this sample at your disposal, you can formulate a business plan for your daycare to show to investors or for your purposes.

You may also use a business plan builder template to help you construct your daycare business plan step by step. See the sample below to help you get started.

• Legal Resources
• Partner With Us
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• Privacy Policy
• Do Not Sell My Personal Information

The document above is a sample. Please note that the language you see here may change depending on your answers to the document questionnaire.

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BUSINESS STRATEGIES

How to create a daycare business plan

• Nirit Braun
• Sep 11, 2023

When you're getting ready to launch your daycare business, one of the first things you'll want to do is create a solid business plan. Think of it as your roadmap for success. This document spells out your goals, strategies and financial projections within the childcare industry.

It serves as your trusty guidebook, helping you navigate the path to success and providing solutions for any challenges that come your way. Keep reading to learn more about the specific elements of a strong daycare business plan, and use the template at the end to get started.

Ready to launch your daycare business? Create a business website today with Wix.

Top benefits of creating a daycare business plan

Starting a daycare business demands careful planning, and a well-structured business plan offers numerous benefits that can significantly contribute to its success:

Helps raise money for your business : Experts estimate that for a home-based daycare serving four to six children, startup costs can exceed $36,000 . A comprehensive business plan is essential when seeking investors or financial support. It showcases your clear vision, market research and growth strategies, demonstrating your commitment and knowledge about the daycare industry. Potential investors are more likely to provide funding when they see a thoughtfully crafted plan that outlines potential returns on their investment.

Helps allocate resources : Writing a business plan forces you to conduct thorough research on what resources, supplies and staff are needed to launch and run your daycare center successfully. From facilities and equipment to educational materials and safety protocols, this detailed analysis ensures that you're fully aware of the startup and operational costs, preventing any unexpected surprises down the road.

Provides operational clarity : A well-constructed business plan outlines your daycare center's daily operations, including schedules, curriculum and staffing requirements. This clarity not only helps you understand the practical aspects of starting a business but also provides a structured approach to managing day-to-day activities effectively.

Highlights market insights : Through the process of writing your business plan, you delve into market research, identifying your target demographic, understanding their needs and analyzing your competitors. According to Zippia, 58% of working parents depend on childcare centers, which means you have a very large market to work with. This information is invaluable in tailoring your services to stand out in a crowded niche, creating a unique selling proposition that attracts parents and caregivers.

Helps with risk management : Starting a daycare business involves addressing potential challenges and risks. A business plan encourages you to identify these risks upfront and develop contingency plans to mitigate them. This proactive approach increases your preparedness and helps you navigate unexpected obstacles with more confidence.

Creates a profitability timeline : Financial projections included in your business plan offer insights into the revenue and expenses expected in the early stages of your daycare business. This information is crucial for determining when your business will become profitable and ensuring that you have a sustainable financial strategy.

Learn more: How to start a service business

How to create a successful daycare business plan in 6 steps

Now we’ll walk through the six essential steps for crafting a daycare business plan tailored to your company's unique needs.

Executive summary

Business and domain names

Market analysis and research

Operations plan, marketing and advertising plan, financial plan.

Thinking of developing another type of business? Check out more service business examples .

01. Executive summary

The executive summary is a concise overview of your entire daycare business plan. It provides a snapshot of your business concept, key strategies, goals and financial projections. While it appears at the beginning of your plan, it's often written last, after you've fully developed the other sections. A well-written executive summary should capture the reader's attention and convey the essence of your daycare business in a compelling and clear manner.

To write a clear executive summary for a daycare business, incorporate the following details:

Overview : Introduce your daycare business and highlight its unique features. Mention the age groups you'll serve, the educational approach you'll adopt and any specific services or benefits that set your daycare apart.

Demand : Describe the demand for daycare services in your target area. Mention any growth trends in working parents, shifting demographics or changes in government policies that could impact your business.

Operations : Briefly outline your strategies for attracting and retaining customers, managing operations efficiently and achieving growth. Touch on your marketing, staffing, curriculum and safety plans.

Staff : Highlight key members of your management team and their relevant experience in the daycare or education sector.

Financials : Provide a high-level overview of your projected revenue, expenses and profitability. Mention the timeframe you expect to break even and showcase your potential for generating returns for investors. You can also mention the amount of initial investment you're seeking and how you plan to use the funds.

Example executive summary for a daycare business

“ABC Sunshine Daycare is a premium childcare center dedicated to providing a nurturing and educational environment for children aged six months to five years. Our play-based curriculum, experienced educators and commitment to child safety make us the ideal partner for parents seeking top-tier care. With a projected 15% annual growth in working parents in our area, we are poised to tap into a significant market opportunity.

Our key strategies include partnering with local businesses to offer exclusive discounts to their employees, implementing a comprehensive child development curriculum and maintaining a low student-to-teacher ratio for personalized attention. We anticipate achieving profitability within the first 18 months, with a projected revenue of $350,000 by the end of Year 2.

We seek $150,000 in funding to secure a prime location, equip our state-of-the-art facility and launch targeted marketing campaigns. Our leadership team comprises experienced educators and childcare professionals, ensuring the highest quality of care for our young learners.”

02. Business and domain names

Knowing how to name a business is crucial for a daycare center and a key step before you register your business . It will be the foundation of your brand identity, influencing how parents perceive your services and creating trust. When choosing a name, consider its relevance to child care, its uniqueness and its ease of pronunciation and memorability.

Using a business name generator like one from Wix can spark creativity and offer unique suggestions that align with your daycare's values and mission. Once you've settled on a name, securing a matching domain name is essential for establishing an online presence. A domain name that reflects your business name makes it easier for potential clients to find you online.

You’ll want to first conduct a domain name search to ensure that the name you want isn't already in use.

Some best practices for choosing a domain name are to keep it short and memorable, which means avoiding complex spellings or special characters. Be sure to make it relevant to your specific services and values. The recommendation is to choose a domain extension (.com, .net, .org) that's familiar and commonly used.

03. Market analysis and research

Strong market analysis is vital for understanding the competitive landscape for this type of business and identifying opportunities where you can thrive. Research the demographics and psychographics of your target audience, their needs, preferences and pain points. Analyze your competitors—both other daycare centers and alternative childcare options—to identify gaps in the market that your business can address.

Incorporate this analysis into your business plan to develop a more robust marketing strategy . Highlight how your daycare's unique value proposition will resonate with parents and differentiate you from the competition. Include plans for pricing, branding, promotions and customer retention strategies to attract and retain families.

04. Operations plan

Your operations plan outlines the practical aspects of running your daycare business. This includes details such as:

Location: Explain the rationale behind your chosen location, considering factors like accessibility, safety and proximity to potential clients.

Premises: Describe the layout and design of your facility, including play areas, classrooms, restrooms and any outdoor spaces.

Equipment: List the equipment and supplies required for daily operations, from educational materials to furniture and safety equipment.

Staffing: Outline your staffing needs, including teachers, assistants and administrative personnel. Detail their qualifications, roles and responsibilities.

Healthy and safety: Highlight your health and safety protocols, emergency procedures and compliance with relevant regulations.

By including these details in your operations plan, you demonstrate a clear understanding of how your daycare business will function and meet the needs of both children and parents.

05. Marketing and advertising plan

To get started with marketing, you’ll need to develop a suite of brand assets, starting with a company logo. You can use a free logo maker to get a professional design in minutes.

Learn more: How to make a website

Your marketing and advertising plan outlines the strategies and campaigns you'll employ to promote your daycare business. Consider a mix of both traditional and digital marketing methods, such as social media. Utilize online platforms like Facebook, Instagram and Pinterest to share engaging content, showcase your facility and connect with parents. You can also use your social media accounts to collaborate with local businesses, pediatricians and schools to build a referral network and increase visibility.

Use your business website for targeted online ads to reach parents in your area who are actively searching for childcare options. Additionally, you could publish a blog on your website that offers parenting tips, educational insights and other valuable content that positions your daycare as an authority in child development.

You can also organize open houses, workshops, or parent-child events to give families a firsthand experience of your daycare's offerings.

06. Financial plan

The financial plan is a critical component of your daycare business plan, outlining your initial funding requirements, revenue projections and profitability timeline. Specify the sources of funding you're seeking—whether through personal investment, loans or investors—and detail how the funds will be allocated.

Provide a breakdown of your startup costs, including cost to start an LLC if relevant, expenses for facility setup, equipment purchase, staffing, marketing and any administrative costs. Present projected revenue based on enrollment estimates, pricing strategies and the competitive landscape.

Create a cash flow forecast that outlines your expected inflows and outflows over a specific timeframe. This projection will help you identify potential financial challenges and plan for adequate cash reserves.

Include a profitability analysis that showcases when you anticipate reaching break-even and becoming profitable. This information is crucial for both potential investors and your own financial planning.

By including a well-structured financial plan, you demonstrate your business' financial viability and your understanding of the financial aspects of running a daycare center.

Template for a daycare business plan

Note that this template is meant to serve as a starting point for your daycare business and you should customize it to reflect your specific business concept and goals.

A brief introduction to the daycare business concept

Market opportunity and growth potential

Key strategies for curriculum, staffing and marketing

Financial projections: revenue, profitability, funding needs

Company and domain name

Name: [Your Daycare Name]

Domain: www.[YourDaycareName].com

Demographics and psychographics of target audience

Competitive landscape analysis

How your daycare addresses market needs

Location details

Facility layout, safety features, outdoor spaces, etc.

Equipment, inventory and setup

Staff roles, qualifications and responsibilities

Health and safety protocols and compliance

Social media strategy

Local partnerships, collaborations with local businesses

Open houses and events

Online advertising plan and ad types

SEO and content marketing strategy

Initial investment requirement

Startup costs including facility setup, equipment, staffing and marketing

Projected revenue based on enrollment estimates and pricing

Cash flow forecast over the first year

Profitability and break-even point analysis

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How to Start a Day Care: A Step-by-Step Guide

Caroline Goldstein is a freelance writer and editor, specializing in small business and finance. Her work has appeared on Fundera, JPMorgan Chase, Prevention, Refinery29, Bustle, Men’s Health and more.

Sally Lauckner is an editor on NerdWallet's small-business team. She has over 15 years of experience in print and online journalism. Before joining NerdWallet in 2020, Sally was the editorial director at Fundera, where she built and led a team focused on small-business content and specializing in business financing. Her prior experience includes two years as a senior editor at SmartAsset, where she edited a wide range of personal finance content, and five years at the AOL Huffington Post Media Group, where she held a variety of editorial roles. She is based in New York City.

Many or all of the products featured here are from our partners who compensate us. This influences which products we write about and where and how the product appears on a page. However, this does not influence our evaluations. Our opinions are our own. Here is a list of our partners and here's how we make money .

If you’re a teacher, former teacher, or simply have years of experience caring for children — and an entrepreneurial streak — you might have considered starting your own day care center, either from home or in a dedicated facility. And at an expected job growth of 7% over the next decade, working in child care is a stable career choice. So, if you’re seriously wondering how to start a day care center, you’ve come to the right place.

As is the case starting a business in any industry, however, your passion for your craft alone — or, in this case, your students — isn’t quite enough to ensure that your day care business is copacetic, either financially or legally. You’ll need to do a good amount of due diligence when looking into how to start a day care business, paying special attention to licensing requirements, and ensuring that your facility and program aligns with your state’s health and safety codes.

If you’re a pro at educating, training, supporting and generally corralling large groups of small children, you should be pretty unperturbed by the work it takes to start a day care business. Here’s what you need to know.

How to start a day care business

Although every path toward starting a business looks different for every business owner, there are a few steps that every aspiring day care owner needs to think about when it comes to how to best start a day care.

1. Decide what kind of day care business you want to start

Before you can even get to writing a business plan for your day care business, you need to decide what kind you want to open. Look into whether you want to start a day care business at home, or whether you want a more commercial facility — there might be different permits required in your municipality depending on which you choose. You also need to decide what age groups you want to focus on.

Next up, you'll have to decide on a business entity, which will have huge effects on the way you're taxed and how you operate your day care business. Will you have partners or open your business on your own? Additionally, you'll want to consider whether you want a business entity that offers you some protection. Making your day care center a limited liability company might be a good move, since the business will take on liability should anything go wrong.

You might also decide to buy into a day care franchise opportunity. This option will significantly streamline the steps you need to take in opening your day care.

Once you narrow down these details about your business, you can move on to the next step in starting a day care business: writing a business plan.

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We’ll start with a brief questionnaire to better understand the unique needs of your business.

Once we uncover your personalized matches, our team will consult you on the process moving forward.

2. Write a day care business plan

This is a step you have to take when starting any business and it can be quite a bit of work, especially for anyone looking to get moving quickly on their business. When you start writing a business plan, start with an outline of all the things you want to include.

Your plan should include a summary, an overview of the company, a market analysis that includes an assessment of the need for a business like yours, a marketing and sales plan, and a financial plan along with financial projections. Don't worry, though, you can always add to it as your business grows.

One thing you should include, though, is market research. The last thing you want to do is go through all of these "how to start a day care business" steps, only to find that there isn't a market for one or that there are already too many day cares in that area to make it a viable business.

Your business plan should also include a budget. The costs associated with opening and running your day care center can never be accurately totaled, but nailing down a budget will give you some parameters to work within (and some peace of mind).

In your budget plan, don’t forget to factor in:

Your startup costs, including day care equipment, food, toys and educational tools, wages, insurance and licensing.

How much tuition you’ll charge.

Your predicted revenue over the next two to three years.

When you’ll break even.

Also know that day care centers can claim certain tax deductions, which can ease your annual financial burden.

You'll also want to include a marketing plan. If you’re seriously researching how to start a day care business, it’s likely that you’ve already been caring for children in your area for some time and have built up a network of local parents. That’s one valuable method of attracting customers (aka word of mouth) covered. Still, implementing even a basic marketing plan can help define and legitimize your business — and if you need to implement a waitlist as a result, that’s great too!

Your marketing efforts can be relatively simple and low-cost. You can start by creating a Facebook page for your day care center and building a business website, making sure to include your contact information and a little bit about your business. If possible, plan to include pictures of your facilities and testimonials from happy customers.

If you’re a fan of social media, it also can’t hurt to create an Instagram, LinkedIn and/or Twitter account to keep both current and prospective customers updated on your business. Just be sure that once you do, you receive permission from parents or guardians before posting pictures of their children, of course.

Analog marketing techniques would work well here, too. If possible, consider distributing flyers or brochures to nearby libraries, schools, places of worship or any other local gathering spots.

3. Obtain the necessary certification and licenses

You may not need a master’s degree in education to become a day care teacher, but each state does require some combination of licensing and certification when it comes to how to start a day care. Visit your state’s Division of Child Care Services (or its equivalent) to find out the training, experience and credentials you need to legally operate a day care facility.

In New York State, for instance, the head of the day care facility must have one of the following:

An associate degree in early childhood education or an equivalent.

A CDA credential (child development associate) and at least two years of experience caring for children.

A high school diploma and at least three years’ experience caring for children.

You'll probably find that there are some other requirements that usually come up when you're looking up how to start a day care business at home or in another facility. Your state may require that you and any staff you hire are CPR-certified, for one. Another point of safety to remember is that you should be trained in at least basic first aid for children. You and your staff might also need to be fingerprinted and undergo background checks before being cleared for work.

Even if your state doesn’t require that you obtain a license, you should consider doing so, as your licensing course will go over all the boxes you need to check to operate your day care in your state — including health and safety regulations, proper food preparation and the required child-to-adult ratio.

4. Find a (safe) day care facility

In certain states, in order to obtain the proper licenses or registration to start your day care business, you’ll first need to show that your day care facility meets your state’s health and safety requirements.

So whether you choose to open your day care facility in your own home, or buy or lease a new property, you’ll need to make sure your facility meets zoning, fire, and health and safety laws. When it comes to how to start a day care at home, you may need to make alterations to your house to comply with day care requirements in your state, so be sure to factor them into your budget.

5. Get insured

Another requirement for obtaining your license? Getting insured. In certain states, you’ll need to be licensed by the Department of Health and Human Services to run your day care center, but to do so, you’ll first need liability insurance.

The exception is home-based day care centers, which don’t need insurance to be licensed by the DHHS. Still, those opening day care centers at home should seriously consider obtaining small business insurance. You always run the risk of a lawsuit when you’re running your own business, but that risk increases when caring for other people’s children — so protect yourself whenever possible.

There are several types of insurance that cover day care businesses — general liability insurance, workers’ compensation, property insurance, abuse and molestation insurance and others — so contact an insurance broker to help you decide which coverage is best for your business.

6. Get a business checking account and credit card

Get a business credit card and a business checking account early on to help you keep your business expenses separate from your personal expenses when first starting a day care.

It’s crucial to separate your personal and business expenses for many reasons, not the least of which is to reduce your (or your accountant’s) burden come tax season. It’s simply the most professional way to conduct your business, too. Set yourself up for success now by signing up for a business credit card and opening a business bank account, and be diligent about using both solely for your day care’s finances.

Having a business credit card can help you increase your business credit score, too. By paying the card off on time — or early if you can — you can boost your score, which will help you late on when you need a loan or other financing for your day care business.

7. Get financing

Most entrepreneurs bootstrap their businesses at the beginning, as it’s difficult for brand-new businesses with limited credit history to secure a business loan, either from a bank or from an alternative lender.

Your financing options aren’t limited to your own purse strings (or your friends’ and family’s). Here are a few other ways to get funding and loans for a child care business:

SBA microloan

Although most SBA loans are available only to businesses with a few years of experience under their belts, SBA microloans are actually designed to help startups get off the ground. They’re especially accessible to women, veterans, minorities and business owners in low-income areas. And unlike most other SBA loan programs, SBA microloans are disbursed by nonprofit lenders, rather than banks.

As the name suggests, SBA microloans tend to be on the smaller side, with amounts capped at $50,000, but they may be as low as $500. (For more context, the average microloan amount was $14,000 in 2017.) And because microloans are designed for new businesses, business owners with average or even challenged credit may still be accepted, as long as other aspects of their SBA loan applications are in good shape.

SBA community advantage

These loans from the SBA have all of the advantages that come with SBA microloans but the community advantage loans are specifically for businesses that are serving traditionally underserved communities. These loans are generally for a higher dollar amount than the microloans and can go a bit further for your business.

Government grants

You might be able to obtain financial assistance to start and run your day care through state or federal funding programs for early childhood education providers. For instance, you can contact your state’s Child Care and Development Fund Plan to look into startup funds, or your state’s school meal contacts to seek funding for your day care center’s meals.

Take a look at the Administration for Children and Families Office of Child Care’s list for a more comprehensive overview of federal and state financing programs for child care centers .

Business credit card

It’s important to use a business credit card to keep your day care’s expenses separate from your own. Of course, using a credit card is also the most convenient way to pay for your daily expenses. And since credit limits for business credit cards tend to exceed those of consumer cards, you can spend more liberally without worrying about maxing out your card.

Another bonus? Using your business card responsibly (by which we mostly mean paying off your balance in full and on time, every month) can help you build business credit. And with a healthy business credit score, you’re in a better position to secure business loans with great terms down the line.

If you opt for a card with a long 0% intro APR period, you can essentially use that introductory grace period as an interest-free loan. Look into the American Express Blue Business Plus card, which, at 12 months, carries one of the longest interest-free introductory periods in a business credit card right now.

After your 12 interest-free months are up, though, a variable APR kicks in at a rate depending on your creditworthiness and the market. Check the issuer's terms and conditions for the latest APR information.

8. Hire staff

You may be planning on running your day care facility solo, but depending on your state and the number of children you’re looking after, that might not be an option — every state sets a required ratio of staff to children to ensure that every child receives adequate care. They also dictate the maximum number of children permitted in a group.

Adult-to-child ratios and class sizes depend on the age of the children, but they might also depend on the size of the day care facility, or face further restrictions based on municipality. For a day care center in New York state, for example, the state requires one adult for six children under school age. However, in New York City, there must be two teachers or one teacher and one assistant to every six children aged 2 to 3, with a maximum of 12 students allowed in a single group. Your own children may or may not be included in that count, too.

So, while hiring really depends upon your state’s requirements, it makes sense to leave room for hiring staff in your business budget. That way, you’ll be prepared for growth, without worrying about your operation shutting down because you’re not properly prepared for it. (Just keep in mind that any staff you hire needs to be appropriately licensed or trained for it, and potentially undergo a background check.)

Start Your Dream Business

9. Write your day care contract and policies

To further legally protect your business, it’s crucial that you draw up a contract, write out your day care policies, and require that potential clients (or, more likely, the parents of potential clients) review and sign both documents before accepting their patronage.

If you're just starting to read up on how to start a day care business, you might not be clear on the distinction between these two documents. To clarify, your contract is the document stating that you’ll provide child care, be compensated for providing care according to the payment terms you specify, and have the right to terminate providing care.

Your policies, on the other hand, provide parents with important logistical information regarding how you’ll run your day care center. There, you can outline protocol regarding vacation, illness, inclement weather, drop-off and pickup times, curriculum, field trips, and anything else you believe is important for your clients to understand and agree to about your day care center.

On a similar note...

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How to Write a Business Plan for a Daycare Center

Sholom Strick

13 min. read

Updated February 7, 2024

Free Download:  Sample Daycare Business Plan Templates

Working out a business plan for your daycare center can be a challenge. There are many expenses you must calculate—more than you’d think! Projected enrollment growth and market demand can also be tricky to estimate.

From knowing your competition to picking the right place to establish your daycare center, there are a lot of lessons to be learned. As someone who owns eight successful daycares in the Chicago area, I know the strategies and approaches that work when it comes to developing a sound business plan for a daycare center.

A business plan should look about three to five years into the future. It serves as a cornerstone of your vision as you move forward. You want to put a lot of thought and solid analysis into your daycare center business plan, because it will more than pay off in the end.

• What makes your daycare center unique?

First of all, start with a description of your daycare center. You want to review all the different components of your business model. This description should basically be an elevator pitch for potential partners and business investors to get excited about what you’re offering and your unique location, philosophy, and approach.

What’s your curriculum based on? What criteria will you use in hiring staff? Write about the market and how you’re fulfilling demand. Write down particular statistics and characteristics of the neighborhood where you’ll locate your daycare center that make your center uniquely promising. Real estate sites like Loopnet and Zillow often provide helpful demographic analyses of neighborhoods; the most in-depth info is usually on commercial properties. For example, if the area around your future daycare center has 3,000 kids under five-years-old and only two daycare centers serving them, you’re in good shape.

In writing your company description, make sure to pay special attention to what sets you apart. Maybe it’s your prime location, your previous experience starting or helping start a daycare center, connections with top-notch staff willing to work for your daycare center, or other unique tools or services you can offer that distinguish you from your competition.

• Do a focused market analysis

Next up is a market analysis . Study statistics of the childcare industry: how big is it? How much do economists and experts project that it will grow in the next five years?

How big is your target market?

For detailed information on the size of your primary market, there are helpful resources such as this market research guide from the US Small Business Administration .

Who is your target market ? Describe who you’re targeting. Using some of the information from real estate websites can be a good approach, like I mentioned above. For example, is the median age of your daycare center’s neighborhood quite young or more elderly? Are you in a bedroom community of a nearby city? Note down how your daycare is going to help these different kinds of parents.

Also, keep in mind other factors: Are you in an area with large amounts of seasonal work where the workforce and population shrinks during winter or grows massively during summer? Like it or not, this will likely affect your revenue and enrollment, especially if you are offering part-time care.

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• What is your business model?

In addition to analyzing your market, note your pricing structure, gross margin levels, and other nuts and bolts of your business model. Will you offer discounts, or accept government-subsidized or reduced payments from lower-income parents? What employee childcare discount will you offer?

For detailed information on the size of your primary market, there are helpful resources, such as this guide from IBISWorld . This insightful article from Forbes is also a good resource, and notes that the U.S. Bureau of Labor Statistics expects daycare to be one of the fastest growing industries in the next few years.

• Location and rental agreements

Pay special attention to the obvious: What is the square-foot-per-child requirement in your town, city, and state, and what is the price-per-square-foot of the daycare center you plan to lease? These two facts are absolutely key to putting together a solid business plan. You will generally need more square-feet-per-kid the younger they are (i.e. toddlers get more square feet than preschoolers).

Pro tip: things like the arc of a door’s inward swing and required sinks will eat up square footage, so take them into account. Always leave at least 10 percent breathing room when calculating required square footage for the classroom sizes you want.

Also, aim for using at least 60 percent to 80 percent of your daycare center on classroom size. Other square footage will be used for office space, hallways, required sinks, foyer, and so on, but you want to be using at least 60 percent for classrooms because that’s where you make your money.

Let’s use the example that you need 35-square-feet for every kid in a classroom up to a max classroom size of 20. That means you need a classroom of at least 700-square-feet (20 multiplied by 35). However, as I mentioned above, you want to leave breathing room of between 20 percent to 40 percent (for things like door swing radius, required baby changing tables, required sinks, future building modifications) so you should actually have a room that’s bigger than 700-square-feet.

In noting the lease information on your business plan, aim to negotiate free months of rent with your landlord. Opening a new daycare takes a long time for construction build-outs, permits, licensing and many other factors—sometimes up to a year. Explain this to the landlord. They want a tenant and commitment. Consider agreeing to a longer lease in return for a few months free or a landlord investment in build-outs.

Alternately, the landlord may agree to defer rent in return for a larger security deposit or added monthly payments. Asking for free months shows you’re a competent negotiator who takes his business seriously and has a long-term profit goal in mind.

Another thing to watch out for with monthly rent is all the added costs. Say your price is $20 per square-foot and your building is 5,000 square-feet. This adds up to $100,000. Divide that by 12 to get your monthly rent: $8,333. Make sure to find out if it is a gross or net rate.

Gross includes everything, but net doesn’t include the following:

• Property taxes
• Landlord insurance
• Common area maintenance fees
• Various other charges

Other questions to answer

How many kids are in your daycare center’s neighborhood and how many daycare centers already exist to serve them?

Take an average daycare center in a city that has, say, 100 kids enrolled. If you’re in a neighborhood that has 2,000 kids you still have room for a few daycare centers to serve demand, assuming around 10 percent to 20 percent of parents will enroll their kids in daycare.

There’s a pretty high demand for good childcare in the United States right now and many other countries. Whether you’re urban or rural the chances are you’ll be in demand—but you should still crunch the numbers before the contractors start working.

• Who are your competitors?

How much market share do they have? What makes them strong and what are their weak points? Are there some more general impediments that could get in the way of flourishing, such as increasingly burdensome regulations in your state, or a lack of reasonably-priced leases to choose from?

There are a lot of regulatory requirements in the childcare industry (a lot!), so keep these all in mind when calculating the costs. There’s so much to keep track of!

Things to keep in mind:

• Understanding your building’s zoning details
• Organizing utilities and garbage pickup
• Having the required playground
• Cribs (for infant room)
• Meeting daylight requirements in each classroom
• Two points of exit from the center
• Up-to-code kitchen with three-compartment sink and grease trap
• Fire alarm system hooked up to a central box
• Buzz-in security system
• Parking requirements
• Maintenance and repair fees

You’ll work with a daycare licensing representative from your town or city from the beginning of the process. They will help guide you through the regulatory process (you have to follow both city or town and state regulations), but it is still entirely your responsibility to keep track of all the costs that regulations and requirements.

• Who will run your daycare center?

Next, you want to list organization and management of your daycare center. Who’s the director and assistant director? What are the details of your ownership structure, board of directors, investor list, partners, and so on?

Write down the responsibilities and roles of everyone on your team. List an advisory board if you have one, list all employee salaries, incentives, referral bonuses for recruiting, and all such details. Also in this part of your business plan, you want to be clear about the legal structure of your business in terms of incorporation, type of partnership (I recommend a passive partnership) and other such information.

All percentages of ownership, investor details, stock details, and so on should be listed. Profiles of staff, directors, investors, and board members should include everything from past track record to education and unique skills.

What’s your marketing plan?

Following your organizational details, you should describe your marketing plan. Budget-friendly marketing strategies are the name of the game here.

Reach your target market

There’s no one way to do this, but I recommend thinking specifically about who your customer base is and marketing accordingly. In my case, I had great success with a marketing campaign where I put ads on the baby seat of grocery carts at a grocery store close to my daycare center.

Be specific

Know your target audience and what they’re looking for, and then show them that you fill that need.

Your marketing strategy should look at how to explain the unique strengths of your daycare center, how you’re going to grow, what staff, if any, you’re going to hire in marketing roles, and what methods you will use, from online ads to brochures and billboards. Having a solid marketing plan will help you get clear on your sales strategy.

Have a plan for funding

Finding funding is another area you’ll want to pay attention to when you’re crafting your daycare center’s business plan.

A funding request should list:

• How much you need now and in the coming three to five years
• What the money will be used for
• Any perks such as free months of rent you negotiated with a landlord that show the viability of your model
• Future potential situations such as a buyout, selling the business, and so on

Your financial projections should include forecasted income, expected enrollment growth, balance sheets, cash flow statements and projected/needed capital expenditures.

Projected costs

Keep in mind that as enrollment goes up you will need more staff as well, in order to meet required student-to-teacher ratios. You’ll also need more food and supplies when you have more kids enrolled.

Financial projections need to factor in many things including:

• Registration fees
• Wait-list fees
• Construction cost
• Staff appreciation day costs
• Software costs
• Supply costs
• Training costs
• Utilities costs
• Marketing costs
• Bank service charges
• Monthly nurse consultant costs
• Interior daycare supplies from clocks to filing cabinets to computers
• Accountant and legal costs

When you first start a daycare, you’re going to be in the red. It costs a lot to start a daycare, and it takes time to get going, as I mentioned. This is normal. You should see profits start kicking in after an initial period of six to 12 months of operation.

Capital costs

In terms of capital expenditures, the list is long, from monthly rent and utilities to staffing, construction, repair and supply costs as mentioned above. Digging deeper in these categories reveals even more items. Infants need everything from towels and cubbies to cribs and toys. Preschoolers need crayons, games, tiny chairs, craft supplies, and much more. List everything you can think of and then add more estimated cost.

For construction, you need to calculate the cost of:

• HVAC systems and ductwork
• Baseboards and finishing work
• Interior doors
• Buzzer system

Get a contractor and tradesperson or two to quote you on the job so you have an idea what it will cost. Don’t forget to factor in architectural fees and the cost of heating, electric, and utilities for the months the daycare is empty of students but contractors are working on it.

Securing loans

To get a bank loan for a new daycare center you’ll have to base a loan off the income of another business you own. That said, loans through the SBA can be standalone based on the viability of your business plan, so I recommend looking into them. If you buy a business, an SBA loan can also be a possibility.

For example, if you pay $500,000 for someone’s existing daycare and are required to put a typical 20 percent down ($100,000), you can cover the rest with an SBA loan. You’ll need to show a solid business plan and have good credit, but an SBA loan has the advantage of not drawing on your other sources of income as collateral.

Funding from investors

Another funding source, of course, is to drum up investors. Some people turn to family, friends, or colleagues. I would recommend keeping it strictly business and avoiding family or friends. If you do go this route, however, have a strong paper record to refer back to if this turn sour down the road.

Business partnerships

In finding a partner you want to ideally find someone who loves your plan but doesn’t have time or interest in being directly involved. This is called a passive partnership, where one partner supplies an investment and the other operates the business.

In terms of a repayment scheme, this will depend on your unique situation. For example, if an investor or investors give me cash up front for my financial projection that my daycare center will be making $200,000 per year after several years, I will repay 50/50, so one investor would get back $100,000 per year once the income target has been reached or if there are two investors they will get back one-third each, and so on.

After you address funding and costs in your business plan, add an appendix with supporting documentation. Keep this on hand for investors to look over.

Your appendix can include:

• Credit history
• Reference letters
• Backup details and sources of your market analysis
• Licenses and permits
• Legal documents
• Copies of lease agreements
• Building permits
• Utilities, maintenance, construction, plumbing, and other contracts
• List of all individuals associated with your daycare such as accountants, lawyers, and consultants
• Write your executive summary

Lastly, write down your executive summary . If you’re starting a daycare center, there’s only so much you can know before you have been in operation for multiple years. However, you can write down a lot about the purpose and strategy of your company, your own background and motivations for starting the daycare center, and your projections of future growth and customer needs.

At the end of the day, if you provide a great service and have a business plan methodically anticipates the needs of customers and kids, you will be a huge success in starting a daycare center!

• Download your daycare sample business plan PDF

Get started right now by downloading  this  daycare center business plan PDF  for free. You can also view other daycare sample business plans , or visit Bplans’ gallery of more than  550 sample business plans  if you’re looking for more options.

Sholom Strick is a daycare owner and the CEO of Hopping In , a free, web-based app that lets parents earn money when their child is absent from daycare. Hopping In is an easy-to-use, innovative tool that makes it simple for parents to book vacant spots on short notice. He is passionate about developing innovative solutions to improve the childcare industry. You can contact him at [email protected].

Table of Contents

• What’s your marketing plan?
• Have a plan for funding

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The Daycare Business Plan Blueprint (Examples + Template)

April 14, 2022

Adam Hoeksema

Starting a daycare business can be a daunting task. There are so many things to think about and plan for. You need to find the perfect location, get the right licenses and permits, hire qualified staff, and, most importantly, create a daycare business plan. 

Creating a daycare business plan is one of the most important steps in starting your business. A well-thought-out business plan will help you get funding, attract investors, and operate your business effectively. 

The bad news is that there is a lot of advice out there on writing a business plan. With so much information and tons of daycare business plan examples to choose from, it can be overwhelming to know where to start. 

The good news is, we've got you covered. In this article, we'll give you a comprehensive guide on how to write a daycare business plan. We will also provide some examples and a free daycare business plan template to get you started. 

But First...Is a Daycare a Good Business to Start? 

Before we talk about how to create a daycare business plan, let's first answer the question: is starting a daycare a good business to get into? 

The answer is a resounding yes! The daycare industry is growing rapidly. It is one of the few businesses that are not only recession-proof but also thrives in uncertain economic times. 

According to the National Association of Child Care Resource & Referral Agencies (NACCRRA), the demand for child care services has increased by 26% over the last decade. This demand is only expected to grow in the coming years. 

When it comes to profitability, the daycare industry is very attractive. According to IBISWorld , the average profit margin for a daycare business is around 15%. That's higher than the average for most other industries! 

If you're thinking about starting a daycare business, know that you are getting into a very profitable and in-demand industry. Now let's talk about how to write a daycare business plan that will help you start and grow your business successfully.

How to Create a Daycare Business Plan 

A daycare business plan is as simple as a word document with the following sections:

• Business Description
• Market Analysis

Business Model

• Location and Facility
• Marketing Plan
• Financial Plan

Executive Summary

This article will provide context of what to include in each section of your daycare business plan. As you work on writing your business plan, you will want to grab our daycare financial projection template as well in order to complete the financial plan section.

Your daycare business plan should be an elevator pitch in itself. It should be attractive to potential partners and investors. Basically, it should give them a clear idea of your business, where it is located, what services you offer, who your target market is, and how you plan to make money. 

Creating a daycare business plan doesn't have to be complicated. In fact, the cheapest and easiest approach is to simply start with a blank word document and work through each of the above sections, it can be pretty easy. Here is a step-by-step guide on how to create a daycare business plan: 

Create a Compelling Business Description

Your daycare business's unique selling point (USP) should be the first thing you include in your business plan. What is it that makes your daycare center different from all the others? 

This description should be the foundation of your marketing efforts as well.

There are a few questions you should answer in your company description. They include:

What's your Curriculum Based On?

Potential investors, partners, and even customers will be interested in knowing what your curriculum is based on. This will help them understand the environment children will be in a while under your care. 

When describing your curriculum, make sure to include:

• What age ranges do you cater for?
• The type of care you offer (full-time, part-time, drop-in) 
• Your educational philosophy 
• The activities and programs you offer 

For example, if your daycare is unique by offering a Montessori curriculum, you will want to highlight that.  In fact, you can learn more about how to start a Montessori program here . 

How Big is Your Facility? 

The size of your facility will say a lot about the type of operation you're running. Are you a small, home-based daycare or a large center with multiple classrooms? 

This section of your business plan may include: 

• A floor plan of your facility 
• The capacity of your facility 
• The number of employees you have 
• Type of equipment and furniture you have 

Who Is Your Target Market? 

You can't market to everyone, so you must identify your target market. This will help you focus your marketing efforts and ensure that you're reaching the right people. 

Below is a daycare business plan example that shows how your business description should be:

“ABC Daycare is a small, home-based daycare located in San Francisco, CA. We cater to children aged 0-12 years old and offer full-time, part-time, and drop-in care. 

Our curriculum is based on the Reggio Emilia approach, emphasizing hands-on learning and collaboration. Activities and programs include arts and crafts, music, and outdoor play. 

Our facility can accommodate up to 12 children at a time. We have a staff of four employees who are all CPR and First Aid certified. 

Our target market is working parents in the city who need quality child care but can't afford the rates of larger daycare centers.  We've created an affordable subscription-based pricing model for our target market to fulfill the demand. We generate revenue through monthly subscriptions and have low operating costs due to our small size. 

Our suppliers are local businesses that provide us with food, toys, and other supplies.” 

Do a Thorough Market Analysis

After writing a compelling description of your business, you need to do a thorough marketing analysis. This analysis will help you determine your target market, what type of advertising and promotion will work best, and how to price your services. 

You should also research the competition and see what they are doing right and wrong. This information will be invaluable as you create your daycare business plan.

Keep these things in mind when doing a market analysis:

The Size of Your Market

This is determined by the number of potential customers in your area who need or want your services. 

For example, if you live in a small town with only a few thousand people, there may not be enough demand to support a large daycare facility. 

On the other hand, if you live in a city with hundreds of thousands of people, there may be room for multiple daycare facilities. 

Your target market is the segment of the population that is most likely to use your services. This includes factors like age, income, education, and location. 

After you've identified your target market, you need to show how you plan on fulfilling the demand. This is where your business model comes in. 

Your business model is a detailed description of how your daycare will operate daily. It should include: 

• How do you plan on acquiring customers? 
• What are your pricing strategies? 
• How will you generate revenue? 
• What are your operating costs? 
• Who are your suppliers? 

Your business model should be detailed and easy to understand. It should also be realistic and achievable. 

Here is a daycare business plan example of a business model for a small daycare center: 

“The daycare will be open Monday through Friday from six in the morning to six at night. We will offer care for children ages six weeks to twelve years old. 

Our rates will be $50 per week for one child and $40 per week for each additional child from the same family. We will offer a discount of $20 per week for families who enroll their children for an entire year. 

We will generate revenue by charging weekly rates for our services. Our operating costs will include rent, utilities, supplies, and salaries for our employees. Also, we will acquire customers through online advertising and word-of-mouth.” 

As you can see, a business model is a detailed description of how your business will operate. It's essential to have one in place before promoting and selling your services. 

One thing you should not forget to include in your daycare business plan is the location of your business and your rental agreement. If you are renting a space, including the terms of your agreement and how long you have the space. If you are purchasing a property, include information on the property, such as square footage and any special features that will help your business stand out. 

This daycare business plan example shows you how to include this vital information: 

“The daycare will be located at 123 Main Street in a commercial space currently leased by the owner. The lease agreement is for three years with an option to renew for an additional three years. The monthly rent is $2000, and the security deposit is $3000. 

The daycare will have exclusive use of the main floor, including a large open play area, a small kitchen, two bathrooms, and four classrooms. The daycare will also have access to the outdoor playground.

80% of our space will be used for childcare, with the other 20% used for our administrative offices and staff lounge. 

We have chosen this location because it is close to several residential neighborhoods and has easy access to public transportation. The space is also large enough to accommodate our future growth.” 

There are many daycare business plan templates you can use to help you get started. This is a basic outline of what should be included.

Daycare Marketing Plan

Most daycare business plan templates will include a section for your marketing plan. Most people overlook the marketing aspect of their business, but it is one of the most important pieces of your puzzle. 

In your business plan, you need to outline your target market, your marketing strategies, and how you plan on executing those strategies. 

You also need to set aside a budget for your marketing efforts. Many people make the mistake of thinking that they don't need to spend money on marketing, but that couldn't be further from the truth. 

The following daycare business plan example shows you how you should describe your marketing efforts:

"Our target market is working for families with children between six weeks and five years old. We will reach our target market through online and offline marketing efforts. 

Some of the offline marketing strategies we will use include print advertising, flyers, and word-of-mouth referrals. We will use a mix of SEO, content marketing, and social media for online marketing. 

We have set aside a budget of $500 per month for our marketing efforts."

As you can see from the example above, your marketing plan should be clear, concise, and to the point. Don't forget to include a budget!

Daycare Financial Plan

Your business plan should include a financial plan section. This is where you'll lay out how much money you need to start or grow your business. Be specific and include dollar amounts. If you're seeking a loan, including information on how much you're requesting and how you'll use the funds.

You should also include a detailed budget in your business plan. Your budget should include all of your projected income and expenses for at least the first year of operation. Creating a budget will help you get a clear picture of what it will cost to start and operate your business.

This section should include projected costs for:

• Rent or mortgage payments
• Advertising and marketing
• Operating expenses such as utilities, supplies, and more. 

Startup costs are another vital item to include in your business plan. This is the money you need to purchase equipment, furniture, or any other items to get your business up and running.

If you plan to secure a loan, your lender will want to see a detailed business plan with information on how you plan to use the loan funds. Ensure you include this information in your business plan to increase your chances of securing funding.

If you're seeking funding from investors, you'll need to include information on how they will be compensated. This is typically done through equity, a percentage ownership stake in your business. 

For example, if you seek $100,000 in funding and offer a 20% equity stake, the investor will own 20% of your business. 

Make sure you use a daycare business plan template that includes a section on funding to ensure you include all the necessary information. If you’re planning to get a loan or seek investment, you’re going to need full financial projections. Our daycare financial model will provide up to 5 years of projected income statements, cash flow and balance sheet forecasts.

Next I want to answer some key financial questions for you as you consider how to forecast your daycare financials. I am going to hit on:

• Daycare Startup Costs
• Daycare Revenue 
• Daycare Facility Operating Expenses
• Daycare Profitability

Let’s dive into some key questions. 

How much does it cost to start a daycare? 

It costs between $10,000 and $50,000 to start an in-home daycare business according to Bizfluent . 

It costs between $59,000 and $3 million dollars to start a daycare facility according to Bizfluent . 

So obviously this is a huge range in startup costs.  The main thing that will determine your startup costs is your daycare facility.  Depending on how large your daycare is, whether you are buying, building, or leasing the space, and how much renovation needs to be done, your startup costs can vary drastically.  

Some tips to help you estimate a cost of a daycare facility:

• A daycare facility should have 35 square feet of open floor space indoors per child. 
• So if you wanted a facility that could care for 100 children you would need 3,500 square feet of indoor space for children, plus additional space for offices, kitchen, bathrooms, etc.  Let’s assume that you would need at least 5,000 square feet of space for a daycare facility that served 100 children.  
• A daycare center would cost at least $295 per square foot to construct in the U.S. based on data from Levelset . 
• Constructing a new 5,000 square foot daycare center would likely cost at least $1,475,000 based on $295 per square foot.  
• Now you might not be constructing new, rather you might rent an existing facility which could require renovations.  You will need to get a specific quote for the specific renovations that you need for your space. 

How much revenue can a daycare business make?

A daycare facility can generate $17,680 in revenue per year per child according to Zippia .  

A daycare business with 100 children can generate over $1.75 million per year in annual revenue based on our average revenue per child of $17,680. 

How much does daycare cost?

The average cost of daycare is $17,680 per year, per child in the U.S. according to Zippia . 

This means that the average monthly cost of daycare in the U.S. is roughly $1,475.

What is the typical child to staff ratio for a daycare? 

The typical child to staff ratios for a daycare are:

• 1 adult staff for every 4 infants (age 0 to 12 months)
• 1 adult staff for every 6 toddlers (age 1 to 3 years)
• 1 adult staff for every 10 pre schoolers (age 3 to 5 years)
• 1 adult staff for every 12 school aged children (5+ years old)

Source - Childcare.gov

These ratios will help you estimate how many staff members you will need.  Our financial projection template makes this easy.  Just enter in your ratios and the number of children you expect to have in each age group and the model will automatically calculate the number of staff required to maintain your ratios.  See the input daycare staffing table below:

What are the typical operating costs for a daycare? 

Your largest operating expense for a daycare facility is likely to be your rent. 

It should cost between $20 and $30 per square foot to rent a daycare center space based on available spaces on Loopnet . 

Other operating costs for a daycare center include:

You can see how you can enter in your operating costs into our financial model below:

How much profit can a daycare make? 

The average daycare profit margin is 6.5% according to Daycare Business Boss . 

Once you complete your projections you will want to take a look at our At a Glance tab to make sure that your projected profit margins aren’t way out of line with the industry norms.  You can find projected profit margins for your daycare below:

This is an important aspect that you may not find in most daycare business plan templates, but it's still essential. An appendix includes any additional information to help you understand your business plan. This might include things like your:

• Business licenses 
• Insurance policy 
• Lease agreement 
• Sample contracts 
• Staff bios 

This section adds credibility to your daycare business plan and shows that you've done your homework. Including all of the necessary details in your appendix will give investors peace of mind and show that you're serious about starting a daycare center.

An executive summary is a brief overview of your business plan and is often considered the most important section. It should be two pages long, with a clear description of your business, your goals, and why you will achieve them.

There are several key elements to include in your executive summary:

• Business Name: This is the name you have chosen for your business.
• Location: Include the city, state, and country where your business will be located.
• Business description: Describe what type of business you will be operating.
• Target market : This is the group of people you will be targeting as customers.
• Competition: Who are your competitors, and how will you compete with them?
• Product or service : What product or service will you be offering?
• Sales and marketing: How will you generate sales?
• Financials: Include a five-year income statement, balance sheet, and cash flow statement.
• Management team: Introduce your management team and their experience.
• Exit strategy : This is the plan for how you will eventually sell or otherwise exit the business in case you decide to retire or move on to other projects.

The executive summary is the most crucial section of your business plan because it gives investors and lenders a quick overview of your company and its prospects. Be sure to include all of the key elements listed above, and keep it under two pages in length.

What Are The Benefits of Creating a Daycare Business Plan?

Research shows that a business plan helps business owners make better decisions, turn abstract goals into tangible objectives, and track progress over time. But what does this mean for those who want to open a daycare? 

Creating a business plan forces you to think through every step of starting your company. It's a valuable exercise that can save you time and money in the long run. Even if you don't end up following your business plan to a tee, the process of writing it will help you better understand your business and what needs to be done to make it successful. 

There are many benefits to creating a daycare business plan, including: 

Gives You a Roadmap to Follow

As with any journey, it's always helpful to have a map. A business plan is that map for your daycare business. It will give you a clear idea of where you want to go and how you can get there. 

Helps You Secure Funding

A business plan is essential if you're looking for investors or loans. It will show potential lenders and investors that you've put thought into your business and have a solid strategy for making it successful. 

Ensures Your Daycare Business is Feasible

When you're starting a business, it's easy to get caught up in the excitement and overlook potential problems. A business plan forces you to take a step back and assess whether your business is truly viable. It also helps you identify any areas where additional research is needed. 

Final Thoughts

A daycare business plan is a valuable tool to help you make your business successful. 

It is worth noting that your business plan is not a one-time exercise but should be updated regularly as your business grows and changes. This document is meant to be a living document that evolves as your business does. 

If you're unsure where to start, there are plenty of resources available to help you, including daycare business plan examples online, books, and daycare business plan templates. 

You can also use our daycare projection template to get your financial plan ironed out and ready for your business plan.

The most important thing is just to get started. The sooner you create your business plan, the better prepared you will be for success.

You can get the Daycare Facility financial projection template here!

The template is simple to use and will save you loads of time while still producing professional looking daycare projections. ProjectionHub has helped more than 50,000 businesses create financial projections so you can be confident that you can do it too.

The daycare business projection template includes:

5 Year Daycare Facility Pro Forma Financial Statements

CPA Developed & Completely Customizable

Free Support & Projections Review

Compatible with Google Sheets

Free expert review of your completed projections

The template is easy to use and you do not need to be an excel wizard to fill it out. Editable cells are highlighted in blue, a video guide is included, and our team is available to answer any questions you have.

You can see the complete walkthrough and demonstration of the daycare business forecast template here:

Get the template today for just $79

If you have any questions before purchasing, please feel free to begin a live chat or email us at [email protected]

100% money back guarantee in accordance with our terms and conditions

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About the Author

Adam is the Co-founder of ProjectionHub which helps entrepreneurs create financial projections for potential investors, lenders and internal business planning. Since 2012, over 40,000 entrepreneurs from around the world have used ProjectionHub to help create financial projections.

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19 Small Business Ideas For 2024

Updated: Apr 19, 2024, 7:21pm

Table of Contents

1. tutoring, 2. music and voice lessons, 3. bookkeeper, 4. pet care services, 5. subscription box service, 6. dropshipping website, 7. dog grooming, 8. copywriter, 9. copy editor, 10. wedding or events planner, 11. photographer or videographer, 12. home cleaning, 13. personal trainer, 14. sewing and alterations, 15. virtual assistant, 16. college consultant, 17. antique sales, 18. life insurance agent, 19. life coach, frequently asked questions.

Every day, hardworking individuals choose to step away from their employers and start their own companies. Small businesses launched by everyday entrepreneurs have added over 12.9 million jobs to the United States. economy in the last 25 years. If you’re looking to join the fray but aren’t sure which path is best for you, here’s a list of 19 profitable small business ideas.

If you’re a master of a particular subject, you can help students struggling in their classes by becoming a tutor. No certification is required to become a tutor, but you should be an ace in the topic. Usually, a tutor has a college degree in the subject they are tutoring.

You can teach in person or online to expand your target market. You may want to invest in some teaching aid tools, such as Canvas or Blackboard. These will help you interact more effectively with online students. You can market yourself or join a tutoring platform, such as BuffTutor, that brings clients to you.

Tutoring is an excellent way to make some money while enriching the lives of the next generation.

Are you skilled with a musical instrument, or do you have golden pipes? Do you love teaching as well? Sharing those skills with others can help foster a love of the arts. You can either set up a studio at your home or travel to your clients’ homes, depending on what works best for your situation. The flexibility means the possibilities here are endless.

You can market yourself to local schools or community theaters where parents are looking to get their kids music or voice lessons. A good teacher quickly gets word-of-mouth referrals for new business, which helps reduce the amount of marketing that you need to do.

Learn more: Find the right scheduling app to keep your sessions organized.

If you’re someone who is great with numbers and pays attention to the little details, starting a bookkeeping business might be a viable idea. Bookkeepers sell their services to small businesses that need help managing the books, preparing payroll and gathering data for taxes. You would need to be very well-organized and understand the inherent liabilities that can come with handling someone’s finances; make sure you form an LLC if you choose this route.

While you don’t need specific credentials to become a bookkeeper, getting something, such as the QuickBooks Bookkeeping Certification, will not only teach you a lot but will also give potential clients confidence in your ability. However, it might cost you as much as $450 to obtain the certification.

A dog walking business is an excellent opportunity for someone who loves dogs and is good with other people’s dogs. You get out every day and enjoy fresh air with grateful pups. This business requires you to go to people’s homes to let their dogs out to play or go for a walk. You don’t need any special credentials to be a dog walker, and since you’ll be using your clients’ leashes, you don’t need to invest in much. Primarily, you should purchase items, such as dog treats and waste bags, so that you are prepared for any situation.

If you live in a rural area where clients are spread out, you could pursue the option of offering more generalized pet-sitting services for those who are on vacations or business trips. The income for this type of service may be less consistent, but it’s an excellent fit for someone with experience handling different types of animals. Many small critters, such as birds, reptiles and fish, require very detailed care that their owners don’t trust just anyone to handle. If you can build a reputation for taking good care of these pets, winning new clients will come with ease.

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Subscription boxes are a hot trend right now. There are subscriptions for anything and everything, including vitamins and contraception. If you have an idea for a subscription box, you could have the next hot trend.

You’ll want to establish a website where customers buy your box. At the end of the month, you send each customer a curated box of goodies. While you can often purchase these items based on the demand, you may need to carry some inventory of certain products. It will all depend on your subscription box.

A dropshipping website promotes products that it doesn’t keep in stock. Instead, it has a deal with a distributor who will take your orders and mail them to your customers on your behalf. This eliminates the cost of having inventory and expands the number of products that a business owner can market and sell.

To start a dropshipping business , you’ll need to find relationships with dropshippers. There are big companies that have thousands of products, such as Oberlo and Alibaba, that do this. You’ll also need to create a website that features the products. Getting started may cost you $500 to $1,000 if you need help setting up a website.

Dogs’ coats need regular care, and dog grooming is a service that is in high demand. Washing dogs, trimming their nails and clipping their fur must be done as often as every 4-6 weeks for some breeds. While you can do this in a client’s home, most groomers have either a retail location or a mobile pet salon where they have all their supplies and tools.

To have a complete setup, a mobile pet grooming van may cost anywhere from $10,000 to $100,000. If you’d prefer clients bring their pups to you, converting a shed into a grooming salon may be a more convenient option.

Just about every business has an online presence, most with some sort of blog or distributed content. This content needs to be written, and most business owners don’t have the time to do this themselves. They hire a professional writer. If you have a passion for certain topics, an ability to do deep research and are a good writer, this can be a profitable business for you.

There are no startup costs other than having a computer with a good internet connection. Many writers market their services on LinkedIn or in business social media groups. You can also reach out to the marketing director of businesses to offer your services.

With hundreds of blogs and content streams starting every day, there’s a huge demand for reliable editors who can ensure high-quality content goes live. If you have an eye for grammar and punctuation, you might consider becoming an editor who reads and helps improve content. And you don’t have to be limited to blogs or social media; you can edit books and print articles as well.

Make sure that you are a grammar stickler and that you know the differences between AP and Chicago-style writing. You’ll want to invest in these manuals so that you can help your clients meet the right style guides. Other than that, you only need your computer to start this business. You’ll market yourself in online groups and may choose to invest in building a website to help promote your new business.

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If you’d love to help make a special day as memorable as possible, the events business is very rewarding. Those who organize these events should have strong networking skills, pay close attention to details and be highly organized. It helps to have a creative edge that enables you to come up with new and exciting ideas for your clients.

If you want to focus on weddings, be prepared to help with all aspects of the wedding, from the decorations and venue to entertainment and food. While you don’t need any licensing or credentials to do this, you want to have a Rolodex of professionals who can fill certain roles at the event.

Learn more: Use CRM software to keep your vendors and your clients organized.

This is a great business for a creative person with an eye for composition. You can be a generalist or niche down as a wedding videographer or family photo session provider. You don’t need any specialized certifications to start a photography business or start producing videos.

However, you do need a high-quality camera and may also want to invest in lighting accessories. To start a videography business, you’ll need a good digital video camera, lights, microphones and bounce boards to help you get the best quality footage. You should also launch a website that shows potential clients your portfolio of work.

A home cleaning service business is an excellent idea for detail-oriented people who want to be solopreneurs or who want to grow to have a team. As a home cleaner, you go to people’s homes and clean the kitchen, bathrooms and all other rooms. You’ll dust, mop and vacuum rooms and make sure that sinks, toilets and tubs are clean.

You don’t need to be licensed to be a home cleaner, but it’s a good idea to get bonded and insured . This gives clients confidence that you are a professional. As far as investment goes, you will want to have your own cleaning tools and supplies so that you don’t rely on clients to provide them—though some will.

A personal trainer helps people meet their fitness goals. As a trainer, you are part workout expert and part motivational expert. You help develop workout plans to help people either lose weight, build muscle or meet other fitness goals. Certification is required if you plan to work at a gym and will also help you build your credentials to get new clients.

A certification might cost you anywhere from $500 to $1,000. Many fitness trainers also have degrees in kinesiology from a university, but this is not required.

If you’re talented with a needle and thread, you could have a business sewing and making alterations for others who don’t have this skill or the tools to do it. While you may be busy with alterations, the real money is in custom jobs for dresses and costumes. If you live near a thriving Renaissance fair or convention center, you can expect to find plenty of potential customers dressing up for events at these locations.

You don’t need any certification to become a seamstress or a tailor. You will need to invest in a good sewing machine and get materials and supplies that you use when working for clients. Advertising your services on-call or even setting up “emergency” booths at costumed events can bring you new clientele from those in a bind.

More business executives are turning to virtual assistants (VAs) to help them with certain business tasks. This saves the business money because they don’t need another full-time employee with benefits while still getting the work done. As a VA, you will do certain tasks, such as managing social media, coordinating travel and maintaining the calendar.

There is no prerequisite to becoming a VA. You just need to be good with people and have keen organizational skills. You’ll want a computer with a fast internet connection to service your clients.

Parents will do whatever they can to help their children get into the college of their dreams. This includes hiring a college consultant who can help prepare them for standardized tests, review personal statements and navigate the world of financial aid and scholarships.

There is little to no overhead as a college consultant. You simply need a computer and a good internet connection. While there are no required certifications, the College Consultant Certification from Heartland Institute can help give you credibility in a competitive market.

You might love going to garage sales and auctions. This hobby can become a business where you buy antiques and then resell them after freshening them up with some paint. You may even work on consignment for clients to limit your cash outlay.

This is a business where you can work from your garage or invest some money and open a storefront. The cost will depend on your location and the size of the store.

If you’re passionate about helping families prepare for the worst-case scenario, then you may be highly fulfilled working as an independent life insurance agent. You’ll work with people to help assess their life insurance needs and find the right type of coverage. You’ll become their main point of contact for sales and service.

To become a life insurance agent, you must pass a state licensing class and a standardized test. Once you do that, you’ll need to get appointed with life insurance companies to offer their products.

A life coach helps people navigate through difficult times in their lives. Coaching may come into play for relationships, parenting or other challenging life transitions. A life coach has a lot of experience and can bring that experience to the table to help people successfully navigate through their troubles and blocks.

While you don’t need a certification to become a life coach, it does help to give you credibility in what you do. A certification may cost you anywhere from $500 to $1,000, depending on where you get it from. The International Coach Federation offers a three-day, accredited program that is $995.

Bottom Line

If you’re ready to start a small business , start with what you’re passionate about and what you already have skills in. You may need a certification or to buy some tools and equipment, but many small businesses can be started for under $1,000 .

How do I start a small business with no money?

There are several funding sources for new businesses and most require a business plan to secure it. These include the SBA , private grants, angel investors, crowdfunding and venture capital.

How can you get money to start a business?

While it takes some work to apply and there’s no guarantee of funding, there are many different types of grants for small businesses available. Competition here can be fierce so make sure you send applications to a variety of sources. Usually, each state has its own programs, but there are also national foundations and organizations that offer grants specifically to minorities . If grants don’t work out, you can always pursue business loans or private investors.

What is the best way to get a business loan?

Online lenders tend to be more flexible than traditional banks, so you may consider shopping around for different rates before applying. Pay close attention to eligibility requirements and repayment terms, and carefully read consumer reviews to gauge the lender’s reputation. Check out our list of the best small business loans to see some of the top lenders.

What is the easiest SBA loan to get?

Small Business Administration (SBA) microloans are the easiest to get because they have little in terms of revenue requirements and are designed for new businesses needing a small amount of capital.

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The Family and Medical Leave Act (FMLA) provides certain employees with up to 12 weeks of unpaid, job-protected leave per year. It also requires that their group health benefits be maintained during the leave.

FMLA is designed to help employees balance their work and family responsibilities by allowing them to take reasonable unpaid leave for certain family and medical reasons. It also seeks to accommodate the legitimate interests of employers and promote equal employment opportunity for men and women.

FMLA applies to all public agencies, all public and private elementary and secondary schools, and companies with 50 or more employees. These employers must provide an eligible employee with up to 12 weeks of unpaid leave each year for any of the following reasons:

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Webpages on this Topic

Compliance Assistance: Family and Medical Leave Act (FMLA) Links to various sources of information about FMLA.

Fact Sheet on FMLA Covers the major requirements of FMLA and updates to the FMLA regulations.

FMLA Compliance Guide Summarizes FMLA provisions and regulations and provides answers to the most frequently asked questions.

elaws FMLA Advisor The FMLA Advisor provides information about employee eligibility under the law; including valid reasons for leave; employee/employer notification responsibilities; and employee rights and benefits.

FMLA Poster All covered employers are required to display and keep displayed a poster prepared by the Department of Labor summarizing the major provisions of the FMLA.

Regulations on this Topic

29 CFR Part 825 - The Family and Medical Leave Act

Employee Leave Entitlements - Reduced or intermittent leave to care for parent, other family member or servicemember