When trying to remain competitive, it can be frustrating trying to select reasonable daycare prices. Parents are easily frustrated when discussing childcare costs. Sometimes, your competition is more than ready to get into a price war with their surroundings. So when it comes to daycare, how do you create a competitive pricing strategy?
Your first step should be to perform research in the surrounding area to determine a competitive pricing strategy. The cost of daycare providers changes heavily depending on location. While doing this, keep in mind the quality of care that these other daycare centers provide. You don’t always have to compromise on price if you have better services.
In the rest of this article, we will provide you some additional tips and tricks for setting daycare prices.
Daycare Prices: What You Need To Know About Average Costs
Typically speaking, the average cost of childcare centers is nearly $12 thousand per year. Costs are almost always lower (about $9 thousand) for school-aged kids, as they have fewer needs than toddlers.
Childcare providers constantly struggle with justifying the cost of their business. With so many parents looking to cut costs, it’s more important than ever to establish your daycare value.
One question you may run into is the following:
What Can You Do That My $50 a Day Babysitter Can’t Do?
The question can sting a bit, but it is something that you will have to address. Among all the childcare options available, you have to set yourself as a quality childcare provider.
You can do so with the following suggestions:
- Indicate that your childcare facility provides their child the opportunity to socialize with other children.
- Focus on the training and expertise of your staff as a strong selling point.
- State that you offer a childcare business that focuses on the wellbeing of a child. Affirm this with food programs, outdoor time, and other features of your daycare.
- Indicate that your daycare facility teaches their children through curriculum introduction (if your service offers that).
You will never be able to beat the cost battle of babysitters. But the ultimate doubt that you can crush here is the focus on quality care over someone just “watching their kid.”
Your value proposition needs to focus on how you are better than any other option. If the offer doesn’t work, those parents weren’t planning on joining your daycare in the first place.
Daycare Prices – How To Cut Costs at Your Daycare
If your goal is to reduce tuition rates (without dropping quality), you need to maintain discipline in your approach. With this in mind, here are some quick tips that you can use to cut costs at your daycare:
Buy in Bulk
If you end up keeping a backstock of daycare center supplies, buying in bulk will assist you in saving on long-term costs. This cost savings applies to almost anything you can buy at a daycare. It is convenient when buying craft supplies, as they last forever.
Buy Replacement Toys in December
Retail experts tell us that the best time to buy toys is the first two weeks of December. While you might believe that distinction to be limited to Black Friday, retailers try and squeeze in last-minute sales during this time. The deals hope to entice parents who are seeking last-minute gifts.
Be More Efficient
While efficient and children don’t always go in the same sentence, your administrative processes don’t involve kids. The more time you spend on these processes, the less time you spend on something worthwhile. One such way to be more efficient is to invest in a tuition management system.
A child care billing software reduces your workload by automating your parent-facing payment system, automatically producing receipts, and calculating late payment fees for you. Check out a sample child care invoice.
Ways You Can Justify Higher Daycare Prices
Another side of a competitive pricing strategy is something called value-boosting. Value boosting is when daycares put in the effort to provide enhanced programs for their attendants. When considering care for children, the quality of this grows up with extra (or enhanced) programs.
Here are a few examples:
Provide Extended Hours
Many daycares shut down right around school time. This shutdown time mimics the timing of a school. But with many parents working at jobs that cause them to work extended hours, you may also consider providing the same service.
Provide Overnight Care
Another unique inclusion you could consider is overnight care. This aspect of a quality daycare is marketed towards allowing parents to get a night out. Focusing on benefits for the parents can be a significant part of your marketing strategy.
Have a Summer Program
If you don’t want to find something to do for the entire summer, choosing to stay open during the warmer months is another option. While typically this isn’t the highest priority for parents seeking daycare options, it provides you another method of offering to take pressure off your clients. You can even provide shorter hours if you don’t feel like taking up your whole summer.
Quick Tips for a Childcare Tuition Increase
If you want to look at increasing your tuition, it’s going to be a difficult conversation. There’s only so much touting your level of quality will do. Here are some extra tips if you are going through a childcare tuition increase
Have Transparent Policies on Daycare Prices
Parents will be more understanding if you break down your cost of sales (COS). This reveal may involve you exposing a portion of your daycare business plan. Be sure you share what you are comfortable with sharing. It should be enough to justify the cost of your quality child care.
Pick Your Times for an Increase in Daycare Prices
Happy holidays! You got a higher bill.
If you can avoid it, pick your times on increases in childcare tuition. Don’t schedule them during significant events: these include birthdays, Christmas, or during vacation time. If you can prepare these increases around a time where
Give Them Notice
Some state laws will tell you this anyway, but it’s best to give your families at least one month of notice before increasing tuition. If possible, try and set this out to three months from now. That will provide them with plenty of time to address their budget.
When it comes to setting daycare prices, you need to stay ahead of the curve. If you want to be higher than others, focus on ways to enhance your quality. If you are trying to keep a more competitive pricing strategy, be more efficient and cut costs without removing essential programs.
If you are seeking some additional tips on handling daycare prices, check out this article on how recurring payments can help you. Thanks for reading.