Business Plan for a Preschool
Many entrepreneurs use “Preschool” and “Daycare” interchangeably. Financially, they are different business models.
A Business Plan for a Preschool must account for the “Education Premium.” While a Daycare focuses on Care (Safety/fed/happy), a Preschool focuses on Development (Kindergarten Readiness). This shift triggers a 20% increase in Operational Costs (OpEx).
The “Education Premium” Breakdown
1. Curriculum Licensing
- Daycare: Generic activities (Low Cost).
- Preschool: Licensed Curriculum (e.g., HighScope, Montessori materials).
- The Cost: $2,000 - $10,000 per year in licensing and consumable materials.
2. Teacher Qualifications
- Daycare: High School Diploma + Experience.
- Preschool: Early Childhood Education (ECE) Degree or specialized certs.
- The Cost: +$2-4/hour per staff member.
3. “Part-Time” Limits
- Daycare: Full-day billing (Standard Revenue).
- Preschool: Often “Session” based (AM/PM).
- The Risk: Filling the “PM Slot” is historically difficult. If you only sell the AM slot, you are paying rent for a building that sits empty 50% of the day.
The Tuition Trap
The most common failure in Preschool plans is Tuition Mismatch. Owners pay “Preschool Costs” (Curriculum/Degree Staff) but charge “Daycare Rates” (Market Average). The math does not work. To run a profitable Preschool, your tuition model must reflect the “Value Added” of the education. You are selling a school, not a sitter.
Conclusion: Value-Based Pricing
If you want to run a true Preschool, you must charge Preschool rates. The “Tuition Trap” happens when owners try to offer a premium educational product at a commodity daycare price.
Parents are willing to pay for the “Education Premium” if you clearly communicate the value. Build your budget around the quality you want to deliver, and then set your tuition to match. Do not apologize for the cost of excellence.