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Caregivers or business owners?
Family child care
providers are both. Caring for and educating young
children is important and rewarding work. Understanding how to operate a
family child care
business helps provide the income and working
environment needed for program success.
Why develop business skills?
When family child care providers consider themselves professionals, it influences how they and others view and respect their role as educators. Being aware of and developing business skills is part of that professional role. Good business skills can save time and money, reduce stress, and support smooth functioning of a program. Creating a “business toolkit” can help.
What is a business toolkit?
A business toolkit is a set of intentional business practices that organize and provide direction for a family child care business. For example, sound business practices and advance planning may contribute to keeping a program fully enrolled and make sure that families understand how a program operates. A business toolkit may include:
- Personnel handbook—written program policies reflecting applicable employment laws and other related regulations.
- Program handbook—written philosophy, policies, and other operating guidelines.
- Contract—written agreement for services, payment, vacation, etc.
- Budget and record keeping system—written documents for income, expenses, tax payments, and other child care -related records.
- Marketing plan—written strategy to promote the program in the community.
What is a business plan?
In addition to the business toolkit, some family child care providers develop a business plan. A business plan:
- Is a more in-depth look at all aspects of running a business.
- Includes many aspects of the business toolkit, as well as addressing insurance, compliance with state and federal regulations, expansion, and cash flow.
- Helps with short- and long-term planning, risk reduction, and is required for securing a business loan.
Get started planning for your business:
Program handbook: When a program’s philosophy, policies, and procedures are outlined, people know what to expect. Sharing this information with families considering a family child care program will help them decide if the kinds of services offered match their child care needs. At enrollment, give families the program handbook to keep and refer to when questions arise.
Contract: A written contract, clearly stating provider and parent/guardian responsibilities, should be carefully reviewed together. Make sure all points are understood and agreed upon by both parties, and that two copies of the contract are signed and dated. Keep a copy and give a copy to the parent/guardian.
Budget and record keeping system: Time invested in initially setting up a system to organize finances and important child care records can save time later. Careful record keeping is important for tax purposes and licensing visits. Family child care providers will want to take advantage of tax deductions. Consider:
- A business checkbook and a business receipt filing system.
- A financial ledger that allows tracking of monthly expenses by category.
- A bookkeeping computer software program.
Marketing plan: A marketing plan identifies the types of families that will use a family child care program and outlines the strategies and costs to promote the benefits of that program to those families. Strategies may include:
- Providing an accurate program description to the resource and referral agency to share with families seeking child care .
- Advertising in newspapers, on websites, and by distributing brochures and fliers in the community.
- Offering tours of the program to families looking for child care.
- Contact your local child care resource and referral agency and other organizations to access free business help.
- Review resources for family child care home businesses.
- Select business practices that match your style and work for you.
Where to learn more:
Selected Business Matters Resources:
http://www.ccids.umaine.edu/ec/growingideas/businessres.htm
Early Childhood Growing Ideas Tipsheet Index
Citation for this Tipsheet:
Downs,
J., Blagojevic, B., Labas, L., Kendrick, M., & Maeverde, J. (2006). Caring for
Young Children - Business Matters. University
of Maine Center for Community Inclusion and Disability Studies. Retrieved
[INSERT MONTH, DAY, YEAR RETRIEVED], from http://www.ccids.umaine.edu/ec/growingideas/businesstip.htm
