Home Daycare Business Plan

Do you love children? Do you want to do something that really matters? Maybe home daycare for you. Check out this home daycare business plan and see if it’s financially viable.

Do you love children? Do you want to do something that really matters? Maybe home daycare for you. Check out this home daycare business plan and see if it’s financially viable.

Working from home can be awesome. Being able to stay home with your own children is a blessing too. Being your own boss and setting your own hours and pay are great too. If you love that idea and you are a kind and patient person with lots of empathy for others, home daycare might be a great plan for your life.

For more about how to start a home daycare or running a home daycare click here.

For a downloadable printable home daycare business plan worksheet, click here.

Home daycare business plan

Home daycare is going to be growing by leaps and bounds after the year we’ve gone through so far. There is going to be a huge need for daycare since many small businesses folded this year. Home daycare is a special type of business that has fairly low overhead and is customizable to put your own personal spin on what you do.

I don’t agree with most people’s ideas of how to teach kids. I have my own brand of teaching. I march to the beat of my own drum. I’m very passionate about why I choose to teach my kids the way I do and I want to be able to chart my own waters. This isn’t possible with working for someone else.

chart with start, idea, plan, action and an up arrow

Giving my kids the very best of me is the number one reason why I love working for myself. I get to study, learn, and do my very best for my families.

Home daycare is fun! There is a lot of hard work, little respect, and lots of messes. But it’s also different every day. You never get bored because you don’t know what you’re going to get. You get to set the tone of your environment. It’s a great place to be.

The first step in starting a home daycare is to find out about how to get licensed of what the rules are for your area. Click on the highlighted text to see more about whether a license is required. Once you determine that, it’s time to do some other research to find out if home daycare is a viable income for your family.

A big part of the cost of providing care will have to do with the regulations you have to follow. Some licenses cost. Some are free. Some states require a substantial expense in getting your home up to code. Some have very few requirements.

Some things you may have to change is fencing, hiring staff, meeting fire regulations, getting medical exams, and acquiring more education, training, or certificates.

Also, consider local zoning laws. Do you rent? Is your landlord okay with a home daycare in their property? Do you own? Is there a homeowner’s association? Do they allow businesses in the neighborhood? It’s important to consider your neighbors for sure.

Daycare business plan

Now that you know if you can open, you need to consider what you can make. Look at existing facilities, homes, and centers in your area. What do they charge? What do they offer? What do you want to offer? Do you plan to have a specialization that you can charge more for?

How many children will you be allowed to keep and of what ages? In Oklahoma, we can keep 7 kids over the age of 2. We can keep 6 kids if 3 are under 2. We can keep 5 if they are all under 2. So, a big determination in how many kids you can keep is what age of children need care in your area and what ages you will enjoy caring for. I LOVE babies, but I don’t love keeping them 10 hours a day. I like to run and play and do activities. I don’t want to hold an infant all day. So, I don’t keep them. For 20 years, I kept all ages from birth to 12, but over the years, I scaled back.

As I got older, it was more difficult to do everything for everyone, so I changed some of my home daycare rules to suit me better at the age I am now. Believe me, home daycare is far easier when you are 24 than when you are 49. I promise!

Now think of your location. Is it a good area that people will be happy to take their kids to? Or will you have a more difficult time getting clients in that area because of some stigma? In my town, there is an east and west side. For some reason, people think the west side is bad. There are good and bad areas on both sides, but home daycares on the west side always struggle. It’s a stigma, not a real problem. But it does affect business.

When doing your research, find out if there are some gaps in care that many people need. Here there is ALWAYS a big need for very young infant care. None of our centers in town take kids under 10 months. And there are always lots of babies being born. If you wanted to open an infant only facility, it would do well.

You could also specialize in early morning or late-night care. What about weekends? Lots of people here work shift work and they need good care at night. Find out who provides what and what people need. You can look on Facebook and find out what people are asking for. You can ask in a community group or a mom group. You can ask the principle and the electuary school what they have heard.

Is afterschool care with transport from the school a huge need? That could be your niche. Think about providing care during all the school breaks but most of the year only doing it for an hour or two after school? There’s always a great need for that. If you like older kids and like helping them with homework, you could be a godsend to many families.

In our state, we have resource and referral agencies that can provide this information to you all in one place. You can ask if you have anything like that when you contact your licensing agency for regulations in the beginning.

Now to make a specific business plan.

notebook and pen ready to make a plan

Home daycare salary

How many children will you care for? What will be the minimum and maximum age you’ll take? Will you charge a different price for different ages? What time will you be open? Will you provide all meals for children? Will you provide diapers and wipes? Will you need to hire staff to help you? What about an accountant or bookkeeper? Housekeeper? Lawn service? Think about all the expenses you may have because you’ll be busy working with kids so many hours a day.

Next, you need a name and a philosophy. Potential parents will want to know your ideals and what you stand for. What are your beliefs about providing care? Will you be play-based? Montessori? Nature-based? Have a strict school readiness goal?

You’ll also need policies and a contract. This is a super important step in your business plan. You may be tempted to skip it, but don’t. You will regret it.

Next, you’ll need a budget. You can use this printable business plan to record all the information you’ve collected and figure out what your budget might be. You’ll have to consider start-up expenses and must-have items to work. And you’ll also have to consider the price of every day supplies such as food, replacement toys, repairs, paper products, and so on.

There are other expenses or charges you may not think about such as are listed below.

Charges for families:

Registration fees

Waitlist fees

Supply fees

Curriculum fees

Expenses for you:

Construction costs

Salaries

Software costs

Training costs

Utilities

Marketing

Bank charges

Insurance

Then you’ll have to figure out the income you’ll be making. What will you charge per child and how many children? Figure up your potential earnings and add it to the printable business plan to come up with your home daycare salary.

Home daycare insurance

Don’t forget about home daycare insurance. Obviously, you’ll have to have homeowner’s insurance and auto insurance for your vehicles, but did you know that neither of those covers your business?

If you have a home daycare and your home is destroyed, your insurance won’t cover your business equipment. Your homeowner’s and vehicle insurance also do not cover accidents for the daycare kids. You need business liability insurance for that. So, check into it with whoever you have your homeowner’s policy through.



Many insurance companies won’t offer it, so you’ll have to look around. If you can’t find any, ask around to other home daycare providers and see if any of them have a suggestion.

Lastly, before you can open, you’ll have to find a way to market your home daycare. Check out these advertising ideas to get you started.

Home daycare website

Don’t forget if you want to make a daycare website to advertise and share information with your clients about what’s going on at daycare, you’ll need to figure in the cost of that as well. You can get wonderful website design help and custom made forms from daycare time solutions here. 

Get your home daycare business plan worksheet here.

Get your home daycare menu planning guide here.

Get your home daycare licensing checklist here.

Don’t forget to pin for later

Do you love children? Do you want to do something that really matters? Maybe home daycare for you. Check out this home daycare business plan and see if it’s financially viable.

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