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Old 07-29-2010, 07:40 AM
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DCMomOf3 DCMomOf3 is offline
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Default Raising Prices?

I am currently charging less $20 less a week per child than other home daycares in my area. At the time I set my prices I had one child of a friend and the mom had been laid off for a while so did them a favor. Now I have other familes and want to bring my rates more inline with the other providers. I don't want to lose any of my kids though, and am afraid that too big of an increase might be too hard for the families. Is a $20/week increase too much? My contracts renew Jan 1st, so I won't increase until then although the money would help now.
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Old 07-29-2010, 07:55 PM
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Abigail Abigail is offline
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I think $20/week seems like a lot. If you have something to back it up knowing that you're still very competitive in your area, I would just use that as your backbone and let others know that you're rates will increase to such and such amount per week because the cost of living has increased, etc.

If you have not had families for a very long time, they might think you're going to have large increases often even though it might be your first one ever. I would recommend looking over your expenses and see where you can save money now to make up the difference because you still have five months before your increase is effective. You can also choose to increase $10/week to play it safe.

If you're looking for more families, I would start advertising now and give anyone new your next years rate. It's best to know in advance if a family can not afford it because then you can get someone lined up to start in January or whenever they choose to take their business elsewhere and it will get you on the road you want to be on.

Good luck!
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Old 07-29-2010, 08:18 PM
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What about doing it in stages? Like an extra $5 per week for 3 months, than an additional $5 ($10 total) for the next 3 months, and so on until you complete the adjustment. You would need to type up a detailed notice to the parents explaining that you have never had an increase, that you are now realizing that you have not been getting the "fair market value" for your services, that with the rising prices of everything from milk to craft supplies and utilities to heat your home, you must take this action. Then explain that as a service to THEM and to ease the adjustment for THEM, it will be done in stages to allow for them to make the needed adjustments in their household budgets. Then give them a detailed schedule of the increases and how it affects THAT particular family's rates.

good luck!
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Old 07-30-2010, 05:39 AM
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Lilbutterflie Lilbutterflie is offline
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I think $20/wk increase is too much. As a parent, I don't know if I could swallow that even if it was done in stages. I would increase your current families $10/wk, and start any new families with the full price that you want to charge.
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Old 07-30-2010, 08:31 AM
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Quote:
Originally Posted by professionalmom View Post
What about doing it in stages? Like an extra $5 per week for 3 months, than an additional $5 ($10 total) for the next 3 months, and so on until you complete the adjustment. You would need to type up a detailed notice to the parents explaining that you have never had an increase, that you are now realizing that you have not been getting the "fair market value" for your services, that with the rising prices of everything from milk to craft supplies and utilities to heat your home, you must take this action. Then explain that as a service to THEM and to ease the adjustment for THEM, it will be done in stages to allow for them to make the needed adjustments in their household budgets. Then give them a detailed schedule of the increases and how it affects THAT particular family's rates.

good luck!
I'm preparing to start the licensing process so I feel I will have justification for raising my rates when that is complete. I love my families and the kids are wonderful for the most part. I don't want stress them too much but also, it is my business and I don't want to stress my income too much either. I like the stages option, I think it would be easier to swallow for them and less guilt for me.

I also like your idea to justify how it will benefit each family. great idea.


Quote:
Originally Posted by Abigail
If you have not had families for a very long time, they might think you're going to have large increases often even though it might be your first one ever.
I have one newer family, I've had for about 5 months. It will be my first increase ever and I don't expect to raise my rates again for a long while. I may have a relaxed conversation about it and feel them out before I announce my intention.

Quote:
Originally Posted by Lilbutterflie View Post
I think $20/wk increase is too much. As a parent, I don't know if I could swallow that even if it was done in stages. I would increase your current families $10/wk, and start any new families with the full price that you want to charge.
That's my concern. I don't want to loose any of my current families. I have a great group right now. Is $10/wk off the bat too much, then raise another $10 for 2012? This being my first and only increase, I don't want to do it in a bad way.
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