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Marissa Schneggenburger

6 Financial Tips for Childcare Centers, Daycares, and Preschools

  • January 27, 2022

To keep your center growing and thriving, it’s crucial to be financially stable. Especially now, managing the financial health of your business is not always easy. With staffing shortages and an increase in responsibilities, it can be hard to increase your center’s finances.

By refining your budget, using grants and subsidies, offering new programs, and more, you can set your center up for financial success. These 6 financial tips from industry leaders will help you improve your childcare center, daycare, or preschool. Keep reading to learn more. 

1. Refine Your Center’s Budget

The first step to refining your budget is understanding it. First, calculate your weekly, monthly, or annual income by outlining these charges per student and identifying the frequency at which they’re charged. This will help you create your overall budget.

Next, subtract your expenses from your income. If it helps, use Kangarootime’s Expense Spreadsheet for Childcare Centers to organize your finances. Once you have your numbers in place, start refining your budget. Below lists your ideal occupancy and the how much of your income you should spend on each category.

  • Ideal Occupancy: 70-90% 
  • Staff costs: 50-55% of your income
  • Operating costs: 11-13% of your income
  • Facility costs: 22-25% of your income
  • Admin costs: 2-4% of your income
  • Profit: 15-30% of your income

To learn more about building a better budget, check out this blog post. 

2. Take Advantage of Grants and Subsidies

There are a variety of grants and emergency funds available to help ease the financial burden on childcare businesses. There are also subsidy programs your center can get involved in to alleviate certain costs such as the USDA Food program and the Head Start program. These grants will save your center money and reduce financial stress so you can focus more on managing and improving your center. 

For more information on available grants and subsidies, check out the links below. 

Office of Child Care: Resources for Providers 

Think Small: Grants and Financial Opportunities

USA Grant Applications: Grants and Financial Opportunities

Child Care & Development Block Grant

USDA Food Program

3. Get a Loan to Help with Costs

A loan is a common way to receive extra funding for your center. It may seem difficult but, this is one of the most accessible options. Here are some different avenues to explore when looking for a lean:

Check out your local Small Business Development Center (SBA)

Your local SBA is a great resource as it helps support small businesses. The SBA connects entrepreneurs with lenders and funding to help them plan, start and grow their businesses.

Contact local community banks

Local community banks are a great option as their focus is on supporting the local economy. 

Funding through non-traditional loans

“In addition to your traditional banks and SBA loans, there are also non-traditional loans you may qualify for from FinTech companies. They typically connect directly to your accounting software, banks, and sales platform for a determination of loan amount. The interest rates and/or fees are generally higher, but requirements are less stringent. Check out Kabbage, Blue Vine, PayPal, Square, and Ondeck.” – Audra Wilson-Russell, CPA and Owner of WATS CPA.

4. Consider Offering New Programs

During the pandemic, we’ve seen many centers pivot and begin offering new programs. This can help you increase revenue and attract new staff and families. Most commonly, we’ve seen centers offer a Kindergarten, afterschool, or distance learning program. The additional support and services can help you care for more kids longer and also provide safe and healthy ways for parents to send their children back to school. 

5. Invest in a CCMS

Implementing a Childcare Management System (CCMS) like Kangarootime will help save time and money while improving your center. This software can automate and simplify processes that take you or your staff hours every week like billing, payroll, scheduling, daily notes, etc. With a CCMS, you’ll spend less on administrative costs like paper supplies and won’t need to schedule staff to cover time-consuming tasks like billing and invoicing. Many software programs also come with parent connectivity, increasing the quality of your center and appealing to more families. For more information on Kangarootime’s software, check out a 10-minute overview here.

6. Focus on Marketing Efforts

Improving your marketing efforts can help you increase enrollment and cashflow. Here are some simple marketing tips and strategies to put your business on the map. 

Register your business with Google My Business

This is a free way to verify your business with Google and have a better chance of reaching parents. It’s also easy for current families to leave reviews, increasing your chances of potential families finding you and enrolling in your center.

Take advantage of social media

Use social media to increase brand awareness, solicit reviews, and generate leads. Consider creating a private Facebook group for parents of your center. Allow them an opportunity to connect with your brand on a deeper level. This will help to continue to build trust and loyalty and perhaps referrals.

You can also:

  • Optimize Your Website
  • Start a Blog
  • Use a CRM (Customer Relationship Management) Platform
  • Connect to your Network
  • Host a Virtual Event

For a complete guide on improving marketing at your childcare center, click here. 


Kangarootime is the leading all-in-one childcare management software for daycares and preschools. With billing and invoicing capabilities, parent communication and staff management tools and classroom automation, Kangarootime helps childcare centers grow and scale. To learn more about optimizing your center with Kangarootime, visit kangarootime.com

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