You are a small business owner. You are a professional educator. You spend hours and hours of time, and plenty of money, to make sure that your child care program is the best it can be, correct? Think for just a moment about everything you put into your child care business. Do you feel that the rates you are charging reflect all your time and effort? If so, great! If not… keep reading.
According to tax expert Tom Copeland, “In my experience, many family child care providers undercharge for their service. They charge much less than child care centers while offering the same or higher quality care.”
We know … parents/guardians never want to hear that rates are going up. But the reality is that the cost of everything is going up plus your time and effort should be rewarded. Think about it … most parents/guardians receive raises over the years by their employers. Don’t you deserve the same?
So … how do you go about raising your rates? When should you do it? How will you let families know? The answer to these questions is really one of personal preference. But here are some things to consider when evaluating a rate increase:
- The current rate of inflation (as of April 2023, the current inflation rate is 5%)
- Cost of materials/equipment (everything you need to run your program)
- Curriculum (Did you begin using one? Is the cost of your current curriculum increasing?)
- Training/PD (Do you need to pay for training? Did that cost increase?)
- Utilities/Insurance (Did these costs go up?)
These are just a few of the tangible costs of doing business you should consider when implementing a rate change. One of the most important intangible costs is your time! We know that providers spend hours and hours of time preparing for each day, completing required paperwork, taking training classes, etc. Your time is also quite valuable. Be sure to consider this when calculating new rates.
September is a great time to implement new rates because it is the beginning of the school year. Just make sure that you update your contracts to reflect the new rates for both new, and existing, families.
You are working hard and your program reflects this. Take a few minutes to sit down and reflect upon whether or not you feel your current rates reflect all your hard work!
Copeland, T. (2023, February 22). Is it time to raise your rates? Taking Care of Business. Retrieved April 30, 2023, from https://www.tomcopelandblog.com/blog/is-it-time-to-raise-your-rates