Researching and creating your home daycare business

Tips for Starting a Childcare Business

by Susie Cortright

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A home daycare can be a rewarding career. You can be a positive influence in the life of young children, and parents in your community can be assured that their children are in good, caring, capable hands when they are not with them.

If you have a genuine and deep love for children and loads of patience, kindness and understanding, a home daycare business might be perfect for you. Here are some of the many benefits of this type of business:

  • Increasing demand. The demand for childcare is projected to increase as mothers and fathers continue to work outside the home.
  • Emotionally rewarding. The early years are such a pivotal time in the life of a child. As a daycare provider, you can have a huge influence on the life of all the children in your care.
  • Stay at home with your own kids. This type of career, more than many others, offers the possibility for you to enjoy time at home with your own children while you care for others.

Starting a Home Daycare Business

While it has many benefits, a home daycare is not likely to create huge financial gains. So, going into this business, it's important that you understand why you are starting this business. And, of course, the love of children must be paramount.

Any parent or caregiver will affirm that being surrounded by children all day can be incredibly demanding. You'll want to make sure you have a solid business plan before you embark on this type of career, and that starts with lots of research.

Here are some of the questions you'll need to consider:

  • Will your community support a home daycare? In other words, does your area need another daycare?
  • Will you be able to charge enough in your area to make this a profitable venture (or at least to stay afloat financially). What is the "going rate" per child in your area for daycare?
  • What are parents in your community looking for in a daycare center? Interview parents in your neighborhood and find out what features they wish they had. What kinds of unique features could you provide as a caregiver?
  • What kind of changes will you need to make to your home and yard to make this work? What kind of effect will this business have on your everyday family life?
  • What are the regulations of your state and local government? You'll need the requirements for caregiver/child ratios, interior and exterior space per child, nutrition, and licensing.
  • What kind of financial outlay would be required? As with any business, you'll need to start with a sound business plan that specifically addresses income and expenses.
  • What is your childcare philosophy? How will you handle discipline issues? You'll need to have a solid, written policy and procedures manual before you open for business.
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  • What hours will you be open? What will you do when children are picked up late?
  • Which meals will you serve? What kind of snacks will you serve and when?
  • What will your daily routine be? What kind of preschool curriculum will you offer? Start thinking now about possible units of study, field trips, and special guests.
  • Are you CPR certified? Regardless of whether it is a state requirement, you'll want to make sure to have CPR certification and first aid knowledge so that you are equipped to handle anything that may occur in the course of your day with the children.
  • What kind of insurance will you need? Inquire about liability insurance, as well as changes to your homeowner's insurance (for accidents that may occur on your property).
  • How will you market your business? Generally, this business doesn't require a lot of marketing. That's due in part to the large demand for quality childcare. And, for home daycares, your neighbors and acquaintances are likely to be your prime prospects so word of mouth is often sufficient. Still, it's a good idea to create a professional brochure detailing your daycare philosophy, curriculum, schedule, and fees.
  • What other ways could you structure your business? Before you begin a home daycare business, think about all the other possibilities in the childcare industry. For example, in my town, there is a very successful babysitting service where caregivers travel to homes or vacationer's hotel rooms. Last time I checked, the service was charging upwards of $20 per hour with a 3-hour minimum. Or consider a drop-in daycare that you could provide during hours where childcare is more difficult to find (evenings and weekends, for example). If you find a very specific niche and fill it, you can generally charge more per hour.

If this all seems overwhelming, you can invest in a business kit with the essentials: forms, policies and procedures, examples of business plans, as well as forms that you are certain to need but that might not immediately come to mind. There's nothing like owning your own business. Enjoy the process of researching and creating your own!

Susie Cortright is the founder of, where you can find more resources on starting a home daycare as well as more ideas for starting a home based business.

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