Developing your business plan

One of the most important parts of a business plan is understanding your market. In other words, know what the demand is for child care services in your area and why families would select you over your competitors. Are there enough families who need your services to fill your classrooms? To help answer that question, consider the following indicators of demand for care: 

• Parent and caregiver demand: Talk to potential customers, including family members who use your business. If you're expanding, you may already know families who want to use your services. If this is the case, ask them to join a waitlist. If you don't know enough families, talk to other families in your community to learn who needs care and what type of care they're looking for, including hours, cost, and ages of their children. This information helps you understand if the type of care and child care slots you'll be offering are in demand among families in your area. 
• Inherent demand: consider changes in the child care landscape or situations that indicate an inherent demand for child care. Some examples include:
  • Being located in a child care desert: child care deserts are assumed to have demand in their area due to the scarcity of existing care. To view the current list child care deserts, visit the Texas Workforce Commission's Child Care Data, Reports & Plans webpage.
  • Providing infant care: infant care is less common.
  • Offering non-traditional hours: providing care during weekends or overnight.
  • Increase in members of the workforce: new large businesses opening in your area.
  • Closing of alternative child care providers: if you know of another child care business closing in your area, include this information as this will result in families looking for care.
• Service demand: understand the other child care options in your community. Are there other programs close by and are they at capacity? What types of hours and care are they offering? For example, if there are a large number of providers offering infant care in your area that are not at full enrollment, consider offering care for other age groups. Alternatively, finding that there aren't infant care providers in your area indicates a potential demand for those slots. Do your hours, ages served, and type of program match what these families need? The more information you can gather about your market, the better decisions you can make in regard to your business plan. 

When thinking about your location as part of your plan, be sure to consider the following points: 

• Cost: what will the rent or mortgage cost for this location? Think about the cost to operate in the area and if you'd be renting or purchasing the facility. Consider utility costs and other monthly expenses to include in your budget.
• Proximity: consider how close your business is to families interested in your care, how far they would need to commute, and how convenient it is to access your location. Adequate parking and ease of pick up and drop off should be reviewed.
• Space: is the location already designed for serving children? Study the areas for indoor care as well as outdoor play and to make sure the space will meet requirements for licensing. Does the space need major renovations, minor renovations, or other physical modifications? If so, what will those be, how long will they take, and how much would they cost? Factor this information into your decision, timeline, and budget.
• Adaptability: think about how long you plan to remain committed to operating at this location and how difficult it would be if you needed to move your business. Consider the liabilities if you needed to end your lease early or sell the property. 

The child care industry can be competitive. To learn about hiring and to access hiring resources, visit the Hiring webpage.

A solid financial plan is important for the success of any business plan, especially one geared toward growing or starting a business. To learn more about budget and finances and access budget and finance resources, visit the Budget and finances webpage.

Create an implementation plan as part of your opening or expansion to outline tasks and deadlines. The details of your plan will be different for each business but make sure to include everything for opening or expanding your business. This includes the steps needed to find a location, hire staff, buy materials, sign up for utilities, and advertise to families. No detail is too small to include when you're starting. It's better to include too much and remove items, than to forget something. Add some flexibility to your plan, as things can change at any time.

Disclaimer 

The information contained here is for educational purposes only and is not intended to constitute legal, tax, or financial advice.