Opening A Center
If you’re reading this, it’s likely you’ve been bitten by the daycare bug—you’ve decided opening a daycare, either at home or in a center, might just be your calling. Before we dive in, allow me to set the stage.
I’ve been in the childcare world since 1991. That’s over three decades of wiping noses, organizing nap schedules, and learning every licensing rule imaginable (only for it to change the next day). My experience includes working at centers, running an in-home daycare for seven years, owning a small(ish) center with a capacity of 79 children for 13 years, and for the past 11 years, managing a larger center with room for 177 little ones. I’ve got my CDA (Child Development Associate) and a Certificate of Mastery in Child Development, but even after all this time, I’m still learning—thanks, state agencies, for keeping us on our toes with those endless handbook updates!
Rule Number One? You’ve Got to Be All-In
Here’s what no one tells you before starting a daycare—it’s not the kind of business where you can disappear off the grid sipping mai tais in Hawaii (I know, disappointing). Sure, it’s tempting to think, “Well, I’ll just hire a manager to run the place.” But I hate to break it to you, the saying “While the cat’s away, the mice will play” hits a little too close to home here. Nobody (and I mean nobody) will care about those kids, those parents, or those licensing rules as much as you—the person who has some serious skin in the game.
Oh, and if you’re not there keeping your eye on things and little Johnny somehow breaks an arm on the playground? Yes, you are 100% liable—even if you’re sipping cocktails on a beach somewhere. Fun, right?
Money? Oh, honey, get ready for reality to slap you harder than unpaid bills at tax season. For a while, you’re not swimming in dollars—you’re barely treading water. Payroll will be your biggest monthly headache, and trust me, paying your staff (because happy employees = a functioning business) will keep your wallet on edge. Don’t forget the delightful duo of payroll taxes and insurance—they’re like that obnoxious relative who never misses a family dinner.
Think you’ll finally make some money? Only if, by some miracle, there’s any “cookies left in the jar” after covering every bill in sight. And then, just when you think you’re out of the woods—BAM! The toilet breaks. Again. Or your ancient equipment decides today’s the day to bite the dust.
The “profit” you’re dreaming of? If you run it right, you will make some money... but not right away. You have to build your business first.
Still interested? Great! Passion is a big piece of the puzzle, and if you’ve made it this far, you’re already on the right track.
Getting Started the Right Way
Step one is to call your local licensing agency and get your hands on their requirements handbook. Read it. Twice. Trust me, this will be your daycare bible. From square footage regulations to child-to-caregiver ratios, these rules will shape everything from the space you choose to the number of staff you’ll need.
Speaking of space, find a location that gives you room to grow—it’s better for business, and trust me, you’ll need it sooner than you think. Ratios are another biggie; every state has specific rules about how many kids you can care for based on the number of staff you have. Don’t gloss over this—it’s a deal-breaker for getting licensed.
The Basics of Setting Up Shop
Here’s the short version of what you need to do to get up and running:
- Secure a Location: Whether it’s your home or a commercial space, make sure it meets state code.
- Hire Staff: Start lean—you likely won’t need a full team at the get-go. My pro tip? Get your early hires to help you set up the rooms. It’s a great way to build rapport with your team while tackling a major to-do item.
- Buy Equipment: Cribs, toys, bookshelves, miniature chairs—the works. It might feel overwhelming, but remember, Rome wasn’t built in a day.
Oh, and a word of advice? Avoid hiring family or close friends initially. It sounds like a good idea—until it's not. Boundaries get blurry, expectations clash, and before you know it, you’re in a sticky situation. Keep it professional for now, especially in those tricky first months.
Don’t Forget the Paperwork
While you’re cleaning, painting, and assembling teeny-tiny furniture, you’ll also need to tackle the less-glamorous side of daycare ownership—the paperwork.
Your checklist should include:
- Parent policy handbook
- Staff policy handbook
- Licensing-required forms
Most other templates can be modified from what your local licensing agency provides, but here’s the deal—put in real effort in your policies. My first parent handbook was eight pages long; today, it’s 56 pages, and I’m still adding stuff. You won’t know what details to include until you’re knee-deep in running your center (trust me, you’ll want to document everything when Karen sends you a passive-aggressive email about nap times). If you’re feeling stuck, shoot me an email—I’m more than happy to share some templates that saved my sanity.
Final Thoughts
Opening a daycare isn’t easy, but for those passionate about shaping the littlest humans into the best versions of themselves, the rewards are immeasurable. It’s a mix of hard work, humor (seriously, staff come up with crazy reasons they can't work), and a whole lot of growth.
If you’re ready to follow your heart—and your state’s licensing rules—consider this your first step into a world of organized chaos, endless giggles, and the occasional rule change (or five).
Chapter two will be coming soon.
Good luck! You’ve got this.
I run a 5-star daycare center in Oklahoma, a place filled with giggles, toys, and potential. On paper, it sounds idyllic, but behind the brightly colored walls and cheerful posters lies a mountain of stress, much of which, surprisingly, doesn’t come from the children. No, the children are the roses in this garden. They are content with a room full of toys and the freedom to play. The real storms come from the adults—the parents, the staff, and even the system itself.
Take parents, for example. They trust us to provide care for their little ones while they go about their day, and rightly so. But sometimes, situations arise that leave us as daycare providers in a perplexing bind. There’s the parent who drops off their child, fully medicated with Motrin because their fever was 104°F that morning. Their hope? One dose of medicine will last until six in the evening, conveniently avoiding the risk of missing work. The inevitable fever returns, and when we call the parent to pick up their child, the frustration comes back at us tenfold. Suddenly, it becomes our fault, even after we learn that little Timmy spent last week at Aunt Linda’s—who just tested positive for COVID.
And then there’s the staff, the lifeline of any daycare. Some of my employees show up every single day, despite personal health battles or family challenges. These women are warriors—true cornerstones of my daycare’s success. But others? Well, there are those who mysteriously vanish after a sneeze or strategically schedule their doctor’s appointments for the middle of the day, making it impossible to work the hours before or after. Like a garden, the health of a daycare relies on all its parts working together, yet some flowers don’t always pull their weight.
Add to that the looming shadow of DHS (Department of Human Services) and the bureaucratic hurdles that can feel as relentless as weeds on a summer’s day. The myriad forms, inspections, and compliance requirements can leave even the most prepared daycare operator second-guessing every decision.
Then, there’s the financial strain. The cost of running a daycare has skyrocketed—supplies, inventory, you name it. To cover expenses, prices rise, and suddenly you’re the villain for charging what’s needed to maintain quality. It’s a delicate balance, like watering your garden just enough to keep it alive without drowning it.
Still, through all the stress, there are the moments that make this garden worth tending. It's seeing a child learn to tie their shoes for the first time, watching friendships blossom in a sandbox, or hearing the unfiltered joy of laughter during playtime.
Working in childcare isn’t for the faint of heart. Owning a daycare is an even steeper climb, full of challenges that could dishearten even the most determined individuals. But if you’re reading this, and you still think running your own daycare sounds like a dream—call me. I might just be willing to hand you my garden gloves. 💐
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When considering affordability, keep the following in mind:
- If you are renting, how long will the price be guaranteed? Is there a discount for signing a long-term lease? What will you do if you need to leave the space before the lease is over?
- Is the space up to code and safe for children? Does it need any renovations or updates? Who will pay for them?
- Are there additional fees for parking or other amenities, like use of nearby playgrounds or space for administrative offices?
- What is the utilities cost? If you are renting or sharing the space, who will pay for utilities?
- If you are considering an in-home facility, how will you budget for additional wear-and-tear on the home and the increase in utilities due to more usage?
- How many hours will need to be spent cleaning? Will you need to purchase cleaning services? If you plan to clean yourself, what is the cost of cleaning supplies and how often will they need to be restocked?
- Are there adequate, well-placed phone jacks and electrical outlets?
- What will be the operating hours of the facility? Will it be open on weekends, at night, and on holidays?
- Will the facility provide transportation or will the children need to be dropped off and picked up? Is there available parking nearby for teachers and parents?
- Is the location on a safe block or street?
- Does the center's location make sense serving its community or target population?
See the Resources section for more information on the Americans with Disabilities Act.
You should request a copy of the policy for your state and review it carefully before making any decisions about renting or buying a space. Remember that the National Database of Child Care Licensing Regulations can help you locate licensing information online.
- What are the fire and safety codes?
- What zoning regulations might limit your use of a space for different activities? Will traffic during pick-up/drop-off, the noise of outdoor play, or your plans for fencing, signage, and/or equipment violate any local rules?
Let's look at some simple procedures and strategies for creating a start-up budget, revising the budget over time, and keeping up with day-to-day financial management. Remember that these processes are constantly changing, depending on the growth of the facility and the demands placed on the facility's staff, resources, and activities.
- Do you need part-time employees, full-time employees, or both?
- Will you have volunteers available?
- Do you need someone specifically to answer the phone and greet visitors?
- Will you need to hire an accountant and/or a lawyer?
- What is a reasonable salary range for each position needed?
- Will you be offering benefits like health insurance or retirement accounts?
Your payroll - including salaries and any withholdings and deductions - must be handled on time, correctly, and honestly; your employees expect it, and laws and regulations require it.
Most taxes are paid partly by the employee and partly by the employer. You should include the employer's portion in your payroll budget; the employee's contribution is deducted from his or her gross salary. You as an employer must withhold and deposit the employee's part of Social Security and Medicare taxes, and you must pay a matching amount. Because taxing rates change, consult the IRS and state's taxing agency to get current year's levels.
*If non-profit, 501 (c)(3) organizations are exempt from contributing to FUTA (Federal Unemployment) taxes. However, you are responsible for SUTA (state unemployment) taxes.
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