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How to Start a Child Care Franchise

Whether you currently own a childcare center or you’re looking to break into the industry, there’s no denying the need for quality care for young minds and their busy parents. If you’re interested in growing an existing childcare business or starting fresh, franchising could be a great option to explore. A franchise can offer you the chance to start a business with the help of a well-known childcare provider on your team. There’s a little give and take to every business agreement, so before jumping in, it’s worth evaluating whether or not a franchise is right for you.

Before we break into the steps you’ll need to take to begin, let’s take a look at what a childcare franchise actually is, things to consider before pursuing it, and how to achieve profitability in your new business. 

What is a childcare franchise?

At its core, a childcare franchise is a business partnership between a franchisee and a franchisor. The franchisee (in this scenario, you) is a person or group that purchases into a franchise, gaining the ability to use the franchisor’s established branding, policies and procedures. Though the franchise runs the business on the day-to-day, the franchisor provides training, support and direction for the business. 

What’s the deal with franchise fees?

Though the amount varies between franchisors, fees are a part of the franchise business model. Since your franchise is serving as an extension of the parent company, there are dues required to start and maintain the standards of their brand. Most will require an initial franchise fee along with annual royalties. Don’t let these fees scare you away though. As we mentioned before, paying these gains you an often well-known brand name and assistance with your center.

Autonomy as a Franchisee

Largely, franchisees need to adhere to the franchisor’s guidelines to help maintain the brand standards that parents have come to expect. This doesn’t mean every franchise is a replica of the others, however. Most allow some autonomy and individualism in day-to-day operations.

Is a childcare franchise the right path for you?

With the definition clear, it’s time to take a look at some of the things to keep in mind when considering franchising.

Passion for Child Care is a Must

If you’re an entrepreneur who’s purely interested in beginning a childcare franchise as a business investment, you may want to consider seeking out a business partner who already has connections in the industry. For a childcare franchise to succeed you’ll need to be invested beyond monetary means and give it, and the children it takes on, the attention they deserve.

Flexibility is Needed in Working with a Franchisor

Remember, as a franchisee, you will need to answer to the franchisor at the end of the day. They will have certain requirements for your operations that must be met to continue using their name and receiving their support. Make sure you can be flexible when it comes to running a business before pursuing a franchise.

Location, Location, Location

Having your childcare franchise right around the corner from your house would be great for commutes but you’ll need to assess your market before choosing a location. Take a look to see how many other childcare centers already exist in your immediate area. Franchisors also may have their own requirements on the location of new businesses depending again on market saturation and the location of other franchises.

Choosing the Right Franchise

To start a franchise you’ll need to partner with an existing franchisor. There are many options so a little homework may be necessary to pick the right one for you. For benefits like name recognition and stellar records, consider seeking out some of the established names in the business like Goddard School, Children’s Lighthouse, Primrose Schools and KLA Schools.

8 Steps to Start a Childcare Franchise

After taking these points into consideration and deciding on the franchise you’d like to work with it’s time to get started with these 8 steps:

1. Secure The Necessary Financing

Though many costs are covered by a franchisor, in almost all cases, you will need to invest some of your own money to get started. According to Goddard School, initial franchise costs can start around $260,000 not including the funding needed to cover school opening costs or post-opening costs. All in all, at the minimum you would need around $880,000 to get started with Goddard School. These numbers can vary greatly from franchise to franchise so make sure you evaluate your finances before beginning the application process.

2. Apply for a Franchise and Determine Its Location

Most franchisors offer tools on their website to help get you started in the franchise application process. Keep an eye out for tools that can help you determine if they are looking to expand into your area like interactive maps to save yourself some time. Once you’ve filled out an initial application, the franchisor will likely reach out with more information and in many cases, follow-up questions for you. From there, they will work with you to determine the location of your franchise and discuss the next steps.

3. Meet All Legal Requirements & Regulations

Though your franchisor may provide some resources on what legal requirements must be met, every state in the U.S. has different regulations and rules. Do some research to see what you’ll need to open a childcare center in your home state, as these requirements are nonnegotiable for franchisors and the law.

4. Recruit Your Staff

Start looking for qualified staff in your area that would be a good fit for your new childcare franchise. Though the franchisor will have some say in the matter, try to ensure you offer competitive wages to help keep good employees on your payroll! 

Not sure what to look for when hiring for your childcare center? We have a resource to help you!

5. Begin Training & Obtain Certifications

Make sure you and your staff have all the necessary training and certifications per the requirements of your state. Your franchisor will also have a training program for you and your staff members as a franchise, ensuring everyone is prepared and qualified for the grand opening.

6. Marketing & Promotion

Oftentimes, the fees paid to open a franchise will cover some marketing costs from the parent company so you won’t be working alone when it comes to marketing your new child care center. Don’t rely solely on them though, this is your chance to start putting your best foot forward and getting your center’s name out there. 

Unsure where to start? Check out our webinar Marketing Tips to Grow Your Business.

7. Grand Opening

The big day is finally here! Make sure you and your staff are ready to make a great impression on the children at your center and their parents as well.

8. Maintain Quality of Education and Operations

This is where a true passion for childcare and understanding of early childhood education comes into play because even after the grand opening is over you’ll need to maintain the same level of quality, standards, and excitement that you began with. This is imperative to maintain your status as a franchise and continue to grow your business.

Ways to Reach Profitability in Your Childcare Franchise

Once your franchise has opened, there may be a period where you aren’t reaching profit just yet. It’s completely normal but you will want to try to reach profitability as soon as possible. Check out these tips to help you reach your profit goals fast.

Engage with Parents

Make parents feel like they are an important part of their child’s care! Offer opportunities to connect with parents via tours, email, a mobile app and beyond to keep them in the loop about their child. Going the extra mile with engagement can lead to happy parents, good reviews and in turn more business. 

Create a Positive Work Environment

A high turnover rate can be costly to any business. Try to ensure your employees are happy in their position by creating and maintaining a positive work environment. Happy employees reflect well on the company and their good mood will carry over into their work ethic with the children and parents.

Engage with Your Community

Set your childcare center apart by getting involved in your local community. Seek out local events in your community where parents will be able to get to know you and your staff. If there aren’t any in the near future consider setting up an open house at your location.

Starting any business is a big undertaking but pursuing a childcare franchise means you don’t have to go it alone. With the support of a franchisor and cooperation on your part, you can reach your dreams of owning a childcare center with some help at every turn!

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