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Daycare Center and Family Home Forum>Rate Change For Already Established DCF
wahmof3 07:39 PM 11-14-2011
Just wondering how many of you have changed your rates for already established dcf???


I know I need to make a change (3/6 dck are on daily rate plus are teachers, so no fee for summer AND a sibling discount of $50 week for 1 dcf). I am losing $$ like crazy, but I dread the thought of them leaving.

The end of last month I handed out new phb, with my new policies regarding fees & sick time. They flipped out! I told them the fee/sick days didn't apply to them bc I would give them a new contract and at least a couple weeks to agree to it. I really wanted to test the water & make sure they had my sick policies. I have yet to get my signed phb acknowledgement form.

My dh says not to change anything until next school year, but I'm not sure if I can afford that. I guess if he is ok w/ it I should be.

So back to the question at hand- how many have changed rates w/ dcf you have had for a long time or did you "grandfather" them from the new rates?
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Texasjeepgirl 08:05 PM 11-14-2011
Originally Posted by wahmof3:
Just wondering how many of you have changed your rates for already established dcf???


I know I need to make a change (3/6 dck are on daily rate plus are teachers, so no fee for summer AND a sibling discount of $50 week for 1 dcf). I am losing $$ like crazy, but I dread the thought of them leaving.

The end of last month I handed out new phb, with my new policies regarding fees & sick time. They flipped out! I told them the fee/sick days didn't apply to them bc I would give them a new contract and at least a couple weeks to agree to it. I really wanted to test the water & make sure they had my sick policies. I have yet to get my signed phb acknowledgement form.

My dh says not to change anything until next school year, but I'm not sure if I can afford that. I guess if he is ok w/ it I should be.

So back to the question at hand- how many have changed rates w/ dcf you have had for a long time or did you "grandfather" them from the new rates?
I grandfathered my parents in for YEARS AND YEARS... and the fact is..
it is JUST BAD BUSINESS...
My policy.. for many years.. was.. whatever I started out charging them.. I stuck with it..but.. once per year.. I would have a rate increase.. On January 1.. but it would ONLY APPLY to new.. in coming clients..
It was a train wreck..
Basically what I had was.. parents referring me to people.. and telling them what I charged..
which sometimes would be a 2 or 3 year old rate...
I finally had to stop that practice...

I did a rate increase.. effective January 1.. across the board... to all clients.. new and old..

POLICY CHANGES should ALWAYS APPLY TO ALL CLIENTS..
And...
as for your 'DH'..
I don't want to step on any toes.. and I usually DO ..
but..
does he work for you .. ?
in your daycare?
does he assist you?
or... does he have an outside job?
I let my DH influence me a few times..
and ..
I regretted it..
The bottom line is this:
ALTHOUGH my husband has a degree in business...and in MARKETING..
and.. I think he is probably one of the smartest people on the planet..
at the end of the day..
THIS IS MY DAYCARE BUSINESS..
I am the one that climbs out of bed at 4:55 a.m.. every day.. even though the daycare doesn't open till 7 am..
so that I can drink my coffee..have my alone time.. shower.. get ready for my day.. and ..
have time to clean out the guinea pig PENTHOUSE..fresh.. EVERY DAY.. before my first client arrives..
vacuum.. AFTER cleaning out the guinea pig PENTHOUSE..
take care of from 9 to 12 children per day.. for nearly 11 hours per day..
THAT is ME...!! not my DH...
This is MY BUSINESS....and I completely trust and value his opinion.. but in the end..
it's my rules..!
lol


www.tammyschildcare.com

www.texasjeepgirl.shutterfly.com
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pfund2233 08:06 PM 11-14-2011
I have raised my rates once (last Jan) and this Oct I switched from an hourly rate where they only paid when they were here to a weekly rate that is paid no matter what. My families (4) whom I have had from day 1 (a year and a half) were great about the change. I simply told them with out the change I would have to leave Daycare and find a diff job... they didn't want me doing that.
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Snowflakes 08:13 PM 11-14-2011
So...this is from my background in small business banking - I used to see so many bank clients price themselves right out of business or in to a serious cashflow problem because they were focused on generating business/foot traffic in their doors. You are working too hard to not be making a fair profit. I would sit down and look at how much you are actually earning - net profit- from each family in a week/month and then decide if it is truly worth your time to keep them on. What is the market like in your area? If they leave - what do you think the timeframe would be to replace them? How much more would you be making every month once you replaced those three families with families paying full price? If you are losing money on them why would you dread them leaving?
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cheerfuldom 08:30 PM 11-14-2011
My thought about home daycare is to first of all, figure out what YOU want and what you need as an income. Form your rates and policies around that. Give out all of the changes at one point WITH a deadline that the contracts have to be signed (there's no reason to make it longer than one week) or a two week notice given. If they sign the contract, let them know an exact date where all changes will occur and new policies and rates enforced (I would give it a month at most). This is YOUR business. You do what you need to do to keep from resenting your families and your jobs. Figure out how many kids you want and start interviewing for any replacement kids. Feel free to start interviewing now if you no for sure that some families will not be staying with you should you demand the changes be accepted. Leaving things as is is going to wear you out fast. Next school year is a long time to be hating your job. ALWAYS give deadlines to every change, if not the parents stall and fuss over things and meanwhile, keep getting what they wanted in the first place.

PS I have gotten into several really frustrating situations because I took my DH's advice. It was well meaning but not well informed. He doesn't know all the daily ins and outs that I do. We discuss what our budget is and what I need to make, other than that, I make all the decisions. As long as my income is consistent, the details are not his business. Trust me, its better that way. You are going to drive yourself crazy trying to keep him happy, the parents happy and meanwhile, you not happy.
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Crazy8 08:45 PM 11-14-2011
I don't change rates on existing children.... never have. But mine usually age out about 4 years old though so its not like 10 years stuck at that rate. And I try not to take teachers kids anymore because of the summer off thing but I deal with one because I have had them for 9 years and they are a GREAT family.

But here's the thing... you say you are very concerned with them leaving if you raise your rates and yet you "can't afford" NOT to raise their rates. Well, it has to be one or the other - I would not raise their rates if you CAN'T AFFORD to be without them. If you feel you can fill those spots easily at your new rates go ahead and give them some notice now that things will change the first of the year. If your rates are fair and comparable to others in your area and they are happy with the care you provide they may balk but will stay with you.
But I always scratch my head when providers basically shoot themselves in the foot by raising rates and then clients go elsewhere and they have no one to fill those spots.
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sahm2three 09:02 PM 11-14-2011
Originally Posted by wahmof3:
Just wondering how many of you have changed your rates for already established dcf???


I know I need to make a change (3/6 dck are on daily rate plus are teachers, so no fee for summer AND a sibling discount of $50 week for 1 dcf). I am losing $$ like crazy, but I dread the thought of them leaving.

The end of last month I handed out new phb, with my new policies regarding fees & sick time. They flipped out! I told them the fee/sick days didn't apply to them bc I would give them a new contract and at least a couple weeks to agree to it. I really wanted to test the water & make sure they had my sick policies. I have yet to get my signed phb acknowledgement form.

My dh says not to change anything until next school year, but I'm not sure if I can afford that. I guess if he is ok w/ it I should be.

So back to the question at hand- how many have changed rates w/ dcf you have had for a long time or did you "grandfather" them from the new rates?
Last year at this time, I sent out a rate change letter. I gave them notice that the rates would change as of Jan 1st of this year. It was almost 2 full months of notice. You have to do what you have to do. It is your business.
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lucky 06:07 AM 11-15-2011
I struggled with it , however I sent home new contracts with a $5.00 per week/child rate increase to go into effect Jan. 1st. I gave them to Dec. 1st to return the signed contracts and I had all but 1 back within a week. It turned out I didn't have too much to worry about. Good Luck!
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Meyou 06:30 AM 11-15-2011
I raised my rates and drastically changed my policies almost a year ago for all my existing families. Most took it well-ish and one family was NOT happy. They shopped around for almost 4 weeks and then signed my contract reluctantly.

I went into the changes prepared to lose everyone. I needed to make the changes for my family and my business.
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wahmof3 06:47 AM 11-15-2011
Thank you all for the great feedback! Its really appreciated! I do need to make some changes

All is well when they are here everyday, but its amazing how 1 day absent effects my income.
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mommiesherie 07:26 AM 11-15-2011
I have been thinking about charging more also. I way undercut myself when first starting out. I don't rely on this income to pay the bills but I am worth more than I get. I just have 2 familys. Total of 4 kids. I don't really want any more because I don't wanna mess with having to get licensed. Especially with such a low ratio I should be getting more. I will never give a sibling discount again!!!!
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wdmmom 07:43 AM 11-15-2011
I have 2 families that have been here since 2009. I raised their rates last month. They came in at really low rates. As I've gained experience, gotten more business, etc, I've been able to implement a lot more toys, learning, etc. They also knew that their rate was significantly lower than the average going rate. I didn't have an issue with either family. New families come in at the going rate. I also have it in the contract that annual reviews will occur and rates may change.
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wahmof3 09:45 AM 11-15-2011
So I just wrote out some numbers:

I only charge the dcf if they are in attendance, no fee for summer, & sibling discount.

By doing this I am losing.................roughly $8000/year!!!! And that does not include sick days.

Wow! I could buy a new car.............lol
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wahmof3 07:20 AM 11-29-2011
Revising my contracts today & handing them out Friday. They will take effect January 1, 2012.

Wish me luck............. I am scared to death!!!!!!
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MommieNana4 08:25 AM 11-29-2011
I started my daycare in Jan 2011. I am raising my rate every year and have it in my 2012 contract that there will be a rate increase every year. I have one family thus far in care and they were advised of the rate increase for next year. I have learned so much from this forum.
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littlemommy 09:00 AM 11-29-2011
I have been wanting to raise my rates with 2 families that I have had for almost 2 years. The thing is, I'm due right after the new year, and don't want parents to find someone else over my maternity leave. If I wait a few more months and then make the change, would it look like I'm raising rates just because I had a baby?

The two families I would like to change my rates for are $0.25/hr cheaper than the town's average. I don't think it's unreasonable to raise my rates after 2 years, I just don't want to lose them!
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awestbrook713 09:06 AM 11-29-2011
I am changing my rates for all dcf's this january, I got a lot of flack for it at first but as of right now everyone is still staying. I will be asking this thursday for their final decisions and if anyone says they are leaving I will be looking for new families this month.
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bice99 11:17 AM 11-29-2011
I was a teacher. DH still is. I charge teachers the same as everyone else, except summers, which they pay half rate (all due the last day of school, separate contract due May 15th). I am closed Christmas and Spring breaks, but charge monthly weekly rate x 50 weeks divided by 12 months. They still have to pay for their kids sicks days, etc. Every 6 months, each fam gets one week of vacation at 1/2 rate. This year I changed policy so no one can use it during the holidays and teachers cannot use it during the summer. I have had teachers' kids since I opened my doors 4 years ago. They all pay.
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wahmof3 11:42 AM 11-29-2011
Originally Posted by bice99:
I was a teacher. DH still is. I charge teachers the same as everyone else, except summers, which they pay half rate (all due the last day of school, separate contract due May 15th). I am closed Christmas and Spring breaks, but charge monthly weekly rate x 50 weeks divided by 12 months. They still have to pay for their kids sicks days, etc. Every 6 months, each fam gets one week of vacation at 1/2 rate. This year I changed policy so no one can use it during the holidays and teachers cannot use it during the summer. I have had teachers' kids since I opened my doors 4 years ago. They all pay.
This is reassuring- thank you so much!
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