Opening a Family Child Care Home


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Opening a Family Child Care Home
BUSINESS GUIDE

Opening a Child Care Center Business Guide | childcareaware.org

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Introduction
There are many things to consider when starting a new child care business. This guide will help you think through the steps you need to take to open a family child care home. 
Table of Contents
03 Are You Ready to Start a Family Child Care Home?
07 Do Your Research
28 Action Steps
48 Training and Education
50 Resources

Opening a Family Child Care Home Business Guide | childcareaware.org

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ARE YOU READY TO START A FAMILY CHILD CARE HOME?
Before you begin the process of opening a family child care home, it is important to understand what family child care is and which local resources can support you through the start-up process.  
Family Child Care
A family child care home is a place where a small group of children are cared for in a residential setting for a fee. Often this type of care and education is offered in your own home. Programs may offer care for typical work or school hours or during non-traditional hours, such as evenings or weekends. Most states require family child care homes over a certain size to be regulated or licensed. Regulations for licensing vary from state to state. For those family child care programs that are not required to be licensed, choosing to obtain a license can show the families in your community that you are committed to providing safe and quality child care.
Your state or local area may refer to family child care using other terms. Some examples include registered child care homes, group child care homes, group family daycare, home daycare, etc. This guide will use the term “family child care” to refer to regulated child care programs in residential settings that do not qualify as child care centers.

Opening a Family Child Care Home Business Guide | childcareaware.org

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Child Care Resource and Referral Agencies
Most areas of the United States are served by one or more Child Care Resource and Referral  agencies, or CCR&Rs. One of the functions of a CCR&R is to help families find child care that meets their needs by providing referrals to regulated child care programs. However, many CCR&Rs also work with child care programs to provide support and resources. They may have many tools for your business and professional development needs. Your local CCR&R will be an important partner for you before, during and after the licensing process.  
Take a moment to find your local CCR&R agency here. Record the appropriate contact information below so that you can return to it if you need to reach out for assistance or with questions. 

Name of Child Care Resource and Referral Agency

Contact Person

Phone Number

Email
Child Care Licensing Office
A second key resource for the start-up process is your state or local child care licensing office, especially if your area is not served by a local CCR&R. You can reach out to your child care licensing office with many of your start-up questions. Find your state or local licensing office contact information here. Click on your state, then click on the Child Care tab to find the licensing resource. Record the child care licensing contact information below for future use. 

Child Care Licensing Contact Person

Licensing Office Phone Number

Licensing Website
Becoming familiar with the aspects of family child care and your local supports is helpful as you prepare to get started. However, the following resource will be important to help you evaluate why you want to start a child care business. 

Opening a Family Child Care Home Business Guide | childcareaware.org

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RESOURCE 1: Are You Ready to Start a Family Child Care Home? 
This resource is meant to help you think about the reasons why you want to open a family child care home and if it is the right choice for you. There are personal considerations for you and your family as well as professional considerations for you to think about as you start your journey. 

Personal Considerations
Do you have a passion for helping children and their families? 

Yes No Not Sure

Do you enjoy being with young children and have the patience to care for them for many hours each day? 
Are you able to manage conflict successfully if it arises with staff and/or families? 
Are you able to get along with multiple types of families and children, even if their parenting style or culture are different than yours? 
Do you have the physical and emotional strength to run a child care business? 

If you have children or other people in your life who need you during child care hours of operation, have you identified someone to care for them if they become sick or need something? 
Do you have a positive attitude, even when challenges arise?

Does your family support your decision? 

If your children are old enough, have you talked to them about the possibility of having a child care business in your home?
If you are considering using your home as the child care business, have you thought about which areas of your home you would use?
If you use your own home and have children of your own, will your children have their own space separate from the child care program when needed?
Does your family support your decision? If you use your own home and have your own children, do you have a space where your children’s belongings, such as special toys and equipment, can be stored away from the toys that belong to the child care?

Opening a Family Child Care Home Business Guide | childcareaware.org

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Professional Considerations
Yes
Are you a self-starter?
Do you have the required education needed in your state or local area to operate a family child care home?  
Do you have the knowledge and previous experience to run a family child care home? 
Do you know where to go to for training or help in running your family child care home?  
Are you comfortable working with licensing requirements and government regulations? 
Do you have the time to learn the necessary skills or are you willing to hire people with different skill sets that you need to have a successful family child care home? 
Are you able to plan and organize well? Think about having multiple children in your home all day, planning schedules and activities, and ensuring families receive timely communication from you.  
Are you comfortable with the potential legal, professional and personal risks associated with starting a new business? 
Have you undertaken similar responsibilities that have demonstrated you have the motivation and determination needed to make your business successful? 
Do you have access to funds you may need to start your business? 
Are you aware of the required amount of business and professional liability insurance you need for your child care program?

No Not Sure

If you checked “Yes” to all of these items, you are ready to continue exploring the next steps in starting your child care business!

If you checked “No” or “Not Sure” to some of the items, reach out to your local Child Care Resource and Referral agency for help.

Opening a Family Child Care Home Business Guide | childcareaware.org

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DO YOUR RESEARCH
Begin by learning some of the basic information about child care and opening a family child care home in your area. The following sections will guide you through topics you should learn about before taking steps to open a child care business. 
Topics in this section:
07 Needs Assessment 11 Child Care Licensing 13 Background Checks 17 Legal, Tax and Insurance
Considerations

Needs Assessment
Understanding the community need for child care is critical for your business to be successful. As you think about opening a family child care home, take the time to do a complete and thorough needs assessment. This is an important first step toward building your business plan, and it is critical for determining whether your community needs your services. Business owners of all types are more likely to succeed when they continually consider the needs of their consumers.  

Opening a Family Child Care Home Business Guide | childcareaware.org

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RESOURCE 2: Family Child Care Needs Assessment 
There are three parts to the needs assessment. First, you need to have data on what type of child care is being offered in your community. Second, you will want to understand more about the families that you might serve through your child care business. Finally, you will want to know what other family child care homes in your area charge for child care. This will help you build your budget. 

Contact your local Child Care Resource and Referral agency (CCR&R) for help completing the needs assessment. 

Part 1: Current Child Care Landscape
Question
Who else is providing child care in your area?
Ask your local Child Care Resource and Referral agency (CCR&R) about the number of center-based and in-home child care providers in your area. 

Answer/Comment
# of licensed centers: # of family child care homes: # of school-based providers:

Where are the other child care programs located?

Other: _____________________________

In the geographic area where you want to open your business, who provides child care services and where are they located? Think about churches, local community centers and schools as well as traditional child care providers. 
Is there a need for child care for a specific age group?
Think about the current providers in the area and what age groups they are serving. Ask your local CCR&R if there is a need for infant/toddler care or care for other age groups. 

Infants (birth-12 months): Toddlers (1-2 years): Preschool (3-4 years): Pre-K (4-5 years):

Before/after care for school-age children (5+ years):

Is there a need for child care during a specific time of the day?

Think about whether you might provide before and/or after-school care to school-age children or children enrolled in part-time pre-k programs. Ask if there is a need for evening, weekend, 24-hour and/or overnight child care options.

Will the need for child care change in the next 2-5 years? Why?

Think about whether there are local companies that are expanding or closing, whether local schools may be providing child care services or other factors that could influence the need. 

Opening a Family Child Care Home Business Guide | childcareaware.org

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Part 2: Family Demographics
Question
How many families with young children live in your area? How many families have school-age children? 
Consider families with children birth-5 years, as well as families with schoolage children. 

Answer/Comment

How many of the families with young children in your area might need child care? How many families with school-age children may need care before or after school and during the summer? 
Ask your CCR&R for current statistics on the number of families that may need care.  

Where do local parents work? What are typical working hours?
Think about the families who might use your program. Some businesses, such as hospitals, factories, emergency services, etc. are open during non-traditional hours. Some families may work for organizations that have more typical work hours. You will want to think about family needs in designing your program. 

How long is the typical commute?
Do families live in suburban areas and commute to a more urban area for work? Are you in a rural area where commute times may be shorter or longer, depending on where families work? You will need to consider these things as you think about your hours of operation. 

Opening a Family Child Care Home Business Guide | childcareaware.org

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Part 3: Determine Costs
Question
What are the typical fees (the market rate) for child care in your area? Check with your CCR&R for this information.
Do families in your area typically get help to pay for child care, such as through the state child care subsidy program?  Will your program be eligible to accept subsidies? What would your program need to do to be eligible to accept subsidies?

Answer/Comment

Family child care average rate:

• Infants: $____________/week

• Toddlers: $____________/week

• Preschool: $____________/week

• Pre-K:

$____________/week

• School-Age: $____________/week

Child care center average rate: 

• Infants: $____________/week

• Toddlers: $____________/week

• Preschool: $____________/week

• Pre-K:

$____________/week

• School-Age: $____________/week

Yes      No

Yes      No

Based on the number of children you plan to enroll, what is your expected cost per child? Contact your local CCR&R for help in calculating this information.
What fees do you need to charge parents to have a profitable program? Can families in your area afford the fees?  Contact your local CCR&R for help in calculating this information.
How much will it cost you to start a new child care business? How much will it cost you to operate your child care business on an ongoing basis? Contact your local CCR&R for help in calculating this information or use the Provider Cost of Quality Calculator. https://childcareta.acf.hhs.gov/pcqc

Infants: $____________/week

Toddlers: $____________/week

Preschool: $____________/week

Pre-K:

$____________/week

School-Age: $____________/week

Infants: $____________/week

Toddlers: $____________/week

Preschool: $____________/week

Pre-K:

$____________/week

School-Age: $____________/week

How many staff do you need to hire? What will you pay the staff? Will you be able to offer any benefits?

Opening a Family Child Care Home Business Guide | childcareaware.org

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Opening a Family Child Care Home