How To Price Your Daycare Services

If you are plaaning to start your own daycare business, you must be able to create a good business plan. A good business plan will surely include prices or rates for your services. However, it is also important to know the best way to price your day care services. There are a couple of things to consider before starting the center. Often, day care business owners who don't have a clue on where to strat will immediately follow the competitor’s rates or price below it. This is the reason why it is very important to know how to set your price before jumping into operating the center.

When it comes to pricing your services, there are some important factors to consider. The first thing you need to do is to determine the pricing objectives. This simply means, listing down what you want to achieve. Here are some examples of pricing objectives.

Set a fee that will help you maximize your revenue from your target market. If you plan to set up a daycare center that offers something other centers are not able to provide such as a particular activity, then this is one good objective.

Always aim for a balanced supply and demand. You can do this by offering a more affordable price during the weak periods or when there is a low demand and increase your rate when the demand goes higher. On Holiday season, you can set a lower rate since parents don't send their children to daycare centers.

Set different rates for different markets. When it comes to parents with more than one child, you can offer them discount.

Next is to think if your daycare center and its services needs an added value. Try to consider if your customer will be able to afford it. See if you are the only daycare center who offers a value added. If you are to give an added value then you need to have a market skimming. Market Skimming is when you charge your customers with the highest possible rate. However, before you set a high rate, you need to promote your service and the rate you will charge effectively.

If there are a couple of daycare services in your area who offers pretty much the same thing as what you offer, then you should think about penetration pricing, which means keeping the lowest price for you more customers.

The most complex thing to consider is price adaptation. This simply means offering various prices to different markets. Parents with 2 or more children at your centre should be given a reasonable discount. However this is also risky especially when the child starts going to school. There is a possibility that you won't be able to go back to the higher rate.

It is a fact that pricing strategies has always bothered many daycare business owners. Remember that if you decide to price lower there is a great chance of more customers but on the other hand, setting up a lower rate might mean cutting back on some luxuries such as quality curriculum and meal and could also make an impact on the image of your business. This is why it is important to think carefully before deciding on the price.

For more info: How to start a daycare center