Running a preschool involves a multitude of responsibilities, including hiring suitable staff, establishing attendance schedules for children, and deciding on what the curriculum will be. These tasks are part of a normal day in the life for preschool owners, administrators, or directors. However, a crucial element that forms the cornerstone of financial success is the effective implementation of billing procedures. A robust and well-organized billing system provides essential insights into the overall performance of your preschool. Let’s look at several factors to consider when overseeing billing for your preschool center.
Establishing Tuition Rates
Understanding and navigating what tuition rate to charge is one of the most problematic aspects of the childcare industry. If you charge too little, your preschool might delay growth and not be able to keep up with coverage on all expenses. Charging too much will create a sense of price resistance from prospective families wanting to enroll at your preschool.
First, let’s take a look at what expenses you must cover. Below are some examples of what you should include:
- Salaries (Both full-time and part-time employees)
- Food and beverages
- Licensing fees
- Other miscellaneous expenses
By adding all of these expenses together, you will be able to gain an understanding of the minimum amount you should be charging to keep your business afloat. A platform like Jackrabbit Care can help alleviate this pain by making it easy for you to set up specific tuition rates for each child in your care. It can designate a multitude of tuition rates ranging from the following: Recurring fees, One-time fees, and a new tuition fee.
It is also important to keep in mind that childcare can be competitive, depending on what your community looks like. You should be mindful of what other preschools in your area are offering and decide on a similar rate. However, if your preschool offers unique and competitive advantages, that could justify a higher price point.
When setting up invoicing options, you should make sure that it is as clear as possible to the family how much is owed, when it is due, and how to pay. Let’s see what invoicing options could look like:
- One option available to you is manually sending out invoices to each family. This could be done through several ways such as; Excel, Microsoft Word, or even email. Using this method is very time-consuming and requires a lot of attention to detail when updating invoices based on frequency levels.
- The second option could be using some sort of general online booking software system. Typically, these involve products like Quickbooks, Square, or Paypal. While these tools are handy, using too many software systems to manage billing can become burdensome and expensive.
- A trusted Child Care Management Software provider like Jackrabbit Care. Our billing features allow for creating recurring tuition for any given period. Users can choose to send any of these auto-generated invoices to users as they please. Think about the amount of time you will save by digitizing this process instead of having to manually send invoices to each family!
Establish Billing Fees and Policies
Billing is more than just the numbers. Life happens and you should be prepared to handle a variety of different situations that may be outside of the norm. For example, these can include school closures, partial payments, late payments, disputes, chargebacks, and other policies that you want families to agree to.
- School Closures: Managing billing at a preschool involves addressing the inevitable occurrence of school closures. Whether due to holidays, unforeseen circumstances, or scheduled breaks, it’s crucial to establish clear policies regarding billing during these periods.
- Partial Payments: Understanding the financial dynamics of parents, preschools often implement policies for partial payments. This flexibility allows parents to manage their budget while ensuring a steady income stream for the preschool.
- Late Payments: Late payments can disrupt the financial stability of a preschool. Clearly defined policies outlining late fees, grace periods, and potential consequences for persistent late payments help maintain consistency and fairness.
- Disputes: Billing disputes may arise due to misunderstandings, errors, or unforeseen circumstances. Your Preschool should have a structured process in place for addressing and resolving disputes.
- Chargebacks: In the event of chargebacks, which can occur with credit card transactions, having clear policies in place is essential. Communicate the steps involved in disputing a charge, the impact on the parent’s account, and any associated fees. This ensures that both your preschool and families understand the process, promoting transparency and trust.
- Miscellaneous Policies: Various other policies may be necessary to address unique situations affecting billing. These could include sibling discounts, referral incentives, or special circumstances that require individualized billing approaches. Clearly outlining these miscellaneous policies helps avoid misunderstandings and ensures that billing processes are comprehensive and fair.
End-of-Year Tax Statements
Tax season. That dreaded time when you hope to find all of the receipts and statements over an entire year. This tends to sneak up on us rather quickly and nothing is worse than trying to gather all of this information!
With a powerful tool like Jackrabbit Care, generating these statements has never been easier. Our platform allows you to select each family account that is associated with your preschool and tag the designated payer to generate a statement based on the date range you select. By digitizing this information, you will greatly reduce the hassle and not have to worry about calculating this information by hand.
Managing all of the billing components for your preschool can seem like a daunting task. Fostering clear communication with parents and guardians about billing procedures, offering user-friendly payment options, and providing timely updates on any changes can contribute to a smoother billing experience for both your preschool and the families you serve. Embracing a child care management software platform and automation where possible can further enhance accuracy and efficiency, allowing you to focus more on the educational aspects of your preschool while ensuring a well-organized and financially sound operation. See what Jackrabbit Care can do for you today by scheduling a demo or starting a free trial.