I have been doing home daycare for almost 4 years. In that time, I have not raised my rates, but I am thinking of doing it now.

I was thinking of raising it $10-20/ week.

Does that sound like too much?

How often (if at all) do you increase your rates and how do you figure out how much to increase?

Thank you in advance for any advice!

Reply

I raise my rates almost yearly, every September. I charge monthly, and I usually increase anywhere between $20 and $40/month.

I think an increase of $10/week is reasonable... not so much $20/week. That would be an increase of over $1000/year.

Reply

I raised my rates significantly after 1 year of business because I realized that I was selling myself short. I knew that it was drastic and could potentially cost me clients.

I raised 2+ year rates from 150/week to 160/week.
I raised 2- year rates from 150/week to 180/week.

Reply

I just did a rate hike for the exact reason as you. I did $10 increase for those still here but new ones coming in were raised $20. It worked out good cause most of those that had just a $10 increase graduated into school except one. And I filled with new clients at the new rate. No one complained though. I did a letter stating why I was raising the rate.

With everything increasing again though....I might be looking at having to do it again. I am trying to increase new clients again in the hopes I won't have to do current ones again. *sigh*

Reply

Rather than raise my current DCF I have raised my rate for new families. I can only care for 5 DCK, 1 is at my new rate, 2 will be leaving in May so the only 2 left at the old rate are kiddos that only come part time (but pay my full week rate) so I doubt I will want to raise their price.

Reply

I increased my rate by $5 per week beginning Jan 1.
I did the increase to all clients.
I gave my clients notice of this LAST SEPTEMBER..
so there were no surprises...
It was my first increase in 3 years....

Reply

This is what I do also. I keep my current clients at their same rates and raise rates for new families.

Reply

I raised my weekly rate up $20.00 and none of my families complained. I gave them plenty of notice and they knew they could find someone else if they wanted. They are all still here so I guess it wasn't so bad for them.

Reply

I used to do that.. for many years I would only increase my rates on new clients.. and freeze the other parents at the rate that they started with..
The downfall to that is..
#1 you cheat yourself out of the additional income if you did a rate increase to all clients..
and
#2...and very specifically the reason I stopped the practice..
was because of parent referrals..
Clients that were set in at the 'old rate'... would refer me to a friend.. a co-worker...
during whatever conversation they had about me..they would discuss what I charge..
I'd have new clients contact me for childcare position..
I'd give them info.. and they'd say... well... so and so said you charge 'this' amount..
I'd have to explain to that person that the person they spoke with was 'set in' at a previous rate...
Potential clients don't like that bit of info..
This situation happened multiple times before I decided it was just better business to give all of my clients ample written notification.. generally I notify in September of the increase... with the increase taking effect Jan. 1 of the following year..
I've also heard of other providers that increase at the beginning of the following school year.. or.. September 1...

Reply

This is what I do too.

I can understand these reasons. Also it can get confusing when you have multiple families at multiple rates. If someone "forgets" to pay, I always go back to their contract to make sure I remember their rate correctly. I also have families that choose to prepay 1 week, 2 weeks, or a month ahead, so that tends to confuse things too if I'm not really organized.

My families appreciate knowing that I haven't increased their rates and will often do a little extra for me when they go on vacation, I'm ill, holidays, etc.

Reply

I agree people like to know they're getting a deal. Also, one way to get around the upset referrals expecting a certain rate is to educate the parents! Parents that give a referral ending in a contract receive a discount on their own tuition so they'll usually tell you if they have a friend looking for care. I'd let them know upfront how appreciative you are of them sharing their positive experience and would offer a current rate sheet. (A subtle way of saying that their rate will NOT be the same) Communication goes a long way!

Reply

I agree. This is what I do. Each time that I raise my rates I always give my current clients a copy of my new fee schedule (rate sheet) so that they know that they are getting a deal. If they change their contract type (FT, PT, Drop-in) they will then have to pay the newer rate. This helps me keep the clients from constantly changing their contract type back and forth since they don't want to lose their discount.

Reply

I normally keep rates the same for individual children the same during their enrollment here, but I will raise rates (to whatever my current rate is) for new kids in the same family. I have had a lot of families who have several kids in my care, spanning 8-10 years from oldest to youngest. I can't afford to keep them at the same rate for that amount of time.

I do make it clear to my families that their rates may be specific to them and ask them not to discuss specific rates if they refer me to anyone else.

Reply

me too.

Reply