Managing Your Business

Danny Morris

Introduction

• Understanding that a Child Care Center is a business

• What we know and what we think we know about operating a business

• Turning telephone inquiries and walk in visitors into revenue

• Employee proficiency• The Bottom Line

Topics of Discussion

• Revenue minus Expenses

• Where revenue comes from

• Expenses

• Budget Process

• Hiring Process

• Hiring the right people

• Selling your services

Understanding a Business

• Profit vs. Non Profit

• Child Care as a Business

• Marketing• Awareness in the

Community• Profit Margin

• Working with a budget

• Including staff in budget process

• Cutting expenses• Sales training for

employees

Where Revenue Comes From

• Tuition

• Registration Fees

• Activity Fees

• Fundraising

• Donations

• Grants

• Classroom Revenue

Tuition is established by the following formula:

– Multiply the Tuition Rate by the # of Children in a particular age group

$150 x 10 toddlers = $1,500 per week x 52 weeks = $78,000 per year

Do this for every age group and every room

Establishing Tuition

Expenses

• Salaries– benefits and taxes

• Rent• Utilities• Food• Supplies• Equipment• Insurance

• Transportation• Facility• Public Relations • Professional

Development• Property Taxes• Accounting and

Legal Fees• Advertising

Budget

• How to begin?• Involve employees in budget process• Is it time to increase your tuition rates• Controlling expenses• Justification of new purchases• Monthly review of budget variances• What does each child represent for your

center

Jan - Mar 13 Budget $ Over Budget % of Budget

Ordinary Income/Expense

Income

1715 · Regular Income

1718 · Tuition Income 74,475.55 83,500.00 -9,024.45 89.19%

1717 · School Readiness Subsidy 5,220.85 4,386.14 834.71 119.03%

1716 · VPK Income 30,476.84 32,150.00 -1,673.16 94.8%

1714 · Grant Income 0.00 1,179.83 -1,179.83 0.0%

1720 · Returns & Allowances

1724 · Return Checks -560.00

Total 1720 · Returns & Allowances -560.00

Total 1715 · Regular Income 109,613.24 121,215.97 -11,602.73 90.43%

Total Income 109,613.24 121,215.97 -11,602.73 90.43%

Expense

6311 · Maintenance

6312 · Janitorial Exp 314.58 269.50 45.08 116.73%

Total 6311 · Maintenance 314.58 269.50 45.08 116.73%

6100 · School Expenses

6104 · School Supplies 954.29 714.64 239.65 133.53%

Total 6100 · School Expenses 954.29 714.64 239.65 133.53%

6291 · Waste Collection 249.00 241.02 7.98 103.31%

6275 · Training 180.00

6000 · Advertising 300.00

6120 · Bank Service Charges 27.00 12.00 15.00 225.0%

6180 · Insurance

6185 · Liability Insurance 1,532.78 1,500.00 32.78 102.19%

Total 6180 · Insurance 1,532.78 1,500.00 32.78 102.19%

6550 · Office Supplies 43.31

6301 · Salary Costs

6167 · Employee Wages 80,761.35 86,525.74 -5,764.39 93.34%

6165 · Employee Health Insurance 3,069.48 5,525.68 -2,456.20 55.55%

6169 · Payroll Taxes & Workman's Comp 11,544.61 11,000.00 544.61 104.95%

6163 · Payroll Delivery Fees 90.00 90.00 0.00 100.0%

Total 6301 · Salary Costs 95,465.44 103,141.42 -7,675.98 92.56%

Total Expense 99,066.40 105,878.58 -6,812.18 93.57%

Net Ordinary Income 10,546.84 15,337.39 -4,790.55 68.77%

Net Income 10,546.84 15,337.39 -4,790.55 68.77%

6:30 a.m. 7:00 a.m. 7:30 a.m. 8:00 a.m. 8:30 a.m. 9:00 a.m. 9:30 a.m. 10:00 a.m. CLASSROOM – Teacher/Child Ratio

INFANTS

TODDLER

2 YEAR OLD

3 YEAR OLD

4 YEAR OLD

SCHOOL AGE

Daily Teacher/Student Schedule

Marketing your Center

• Hiring the right people• Selling your services• Understanding the importance of a

telephone inquiry or a walk in prospect

• Close the deal• The importance of staff moral• Sell your employees on selling the

center