The owner of Houchen Community Center, Emilia Dormer, speaks on how to open a children’s development center from scratch because this line of business has every chance to become a popular business in 2018.
“Children’s leisure, even with elements of education, is more of a luxury, not a necessity – therefore children’s centers are more sensitive to crises than kindergartens. If the crisis hits the wallet, parents will first of all give up paying for children’s groups. Now there is a huge number of children’s centers in the USA but the question of their quality is very acute.
Very often, entrepreneurs in the field of child development are emotional people, less often – people with economic and business thinking. The main risk is the absence of a calculated and considered business model. The children’s center begins to bring joys and difficulties literally from the first days of its work, so its founders risk not to take into account the financial indicators and do not make correct conclusions in time. Financial indicators may suggest what exactly needs to be corrected in the work of the center.
Investments and expenses
In order to start a child care business, different amounts will be required: from $8,000 to $13,000, provided that you have successfully managed to rent a space of up to 120 square meters. The number of groups and children in such a center will depend entirely on the schedule. If the preference is given to short-term occupations from 30 minutes to 1.5 hours, which are visited by kids several times a week, the club can take up to 170 children per month. If the main emphasis is on groups with a stay from 3 to 8 hours, they will be visited by fewer children, but the revenue from one child will be higher.
The payback period directly depends on the initial investment. Investments from $8,000 to $13,000, as a rule, are fully returned within one academic year. In my case, 100 day loans were very helpful since I needed about $9,000 for investments and expenses. Fortunately, I was able to return a loan within 2 months.
It is worth highlighting several main items of expenditure, which should be optimized in the operational activities:
- Rent – 25-35%;
- Personnel – 25-35%;
- Low season expenses: this includes all expenses that the entrepreneur incurs during periods of decline in consumer demand;
- Communication costs (telephone, Internet), security, printing, teaching aids and materials – about 10%
Choosing a room
Choosing a room is one of the most important stages. But first you need to clearly define what services your center will offer: there are requirements for premises for each type of occupation.
The center, which specializes in language training, should have several small rooms, and a center with more attention to physical activity (boxing, dancing, gymnastics, judo) should have at least one room with an area of 30-40 square meters.
It is not necessary to consider the basement premises: kids and parents often do not like such places. Large windows and high ceilings always look great. Do not forget about the general requirements for children’s institutions – there are special rules and regulations for children’s bathrooms, the height of ceilings.
The selection of equipment is usually handled after the concept of the center has been prepared. We must first answer ourselves to a few questions: “What will we sell / offer to customers?”, “Who is our client?”. In this case, it is not only about the age of the child, but also the status of the parent.
It is necessary to remember the mandatory availability of sanitary books for staff. The requirements for experience and education depend on the positions that the candidate claims. If the children’s center does not work with groups with a stay of 3 hours or more, then there will be no need for nurses or cooks, and if the children’s center positions itself as a kindergarten, then these specialists will be required. You may start the work of the child care center with 5-6 people, but in full load mode, the number of employees will double or triple.
The income of the staff can depend on various factors: piece-rate pay, standardized assignment, salary. In each case, the personnel payment scheme should be developed individually, taking into account the methods of taxation, territorial specifics, the schedule of work.
Child care centers differ in the methods of work. Many of them choose one pedagogical direction. Houchen Community Center prefers a mixed direction based on five standards of effective pedagogy. In this case, the center tries to please more parents, offering different approaches.
In addition, children’s centers can differ in the types of activities: someone focuses on intellectual development, someone – on the art sphere. In the last decade, there was a fashion for active intellectual development of the child when parents and then teachers taught kinds by cards and cubes from the very birth, and kids started reading in 2-3 years. Now, on the contrary, parents and teachers prefer a free psycho-emotional and aesthetic development of the child.
The length of the possible stay of children in the children’s center or the club can also vary.
Seasonality of business depends on the territorial location of your center. The old sleeping areas and the areas built up by business-class houses have a strongly pronounced seasonality: in the first case, parents traditionally take their children to summer houses from May to September, in the second – families usually go abroad this time.
If you started a child care center in a modern sleeping budgetary area inhabited by young families who have taken out a housing mortgage, then seasonality will be less expressed: in such an area, as a rule, parents can afford to take away children only for one or two summer months.
In winter, there is also a decline in interest in children’s recreational services: at the end of December, many customers scatter for the New Year holidays, some of them return only at the end of January. From December to March, there are epidemics of colds, which again leads to a drop in attendance.
Without advancement, children’s businesses are doomed to oblivion, but classic promotional tools are no longer working. Postal and SMS-mailings, ads on any media, flyers and coupons attract a small number of customers.
Direct individual contact with a potential consumer is a modern trend of promotion. Children and parents need to be amazed, you need to try to be remembered. Therefore, low-cost but entertaining events with “eye to eye” contact are very good. Sales through social networks and Houchen’s website became more active.
The main thing to remember is that a children’s center is a living organism that does not tolerate stagnation. Changes must occur daily, and then it will easily gain popularity.
The developing center for kids is not only an interesting and profitable business, it has many prospects. This is one of those areas of activity in which you can receive stable good money and at the same time be calm and confident in the future, feel the peace of mind and receive moral satisfaction from work! Good luck!”