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  #1  
Old 04-11-2014, 10:45 AM
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aDCProvider aDCProvider is offline
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Default How Do You Charge For Holding A Spot For An Extended Period Of Time?

Last year I held a couple infant spots for almost 6 months and I was still pretty new to this so I only charged a 4 week deposit. After a while, I realized it was not worth my while to only charge so little to hold a spot for so long. I turned multiple people away for these spots while making no income on them until the babies started.

Fast forward, now I have a system in place where the deposits get larger, the farther out the start date is.
-2 weeks deposit for starting within 30 days.
-4 weeks for starting within 30-60 days
-8 weeks for starting within 60-120 days.
To hold a spot beyond 120 days and I begin collecting full tuition as a holding fee not to be credited towards future attendance. Whereas my deposits are applies to last 2 weeks of care, first 2 and last 2 weeks, and first 4 and last 4.

Lately, every family I interview that doesn't need the spot for several months (6+ where they would have to pay tuition after the deposit runs out), balk at how large the deposit is and the fact that they see paying the holding fee (tuition) as paying something for nothing.

I thought this was a great system, it protects me from huge financial losses while holding a spot. I am finding that people don't want to pay a $1500+ deposit to hold a spot (in my area the daily rate is $50+). So they end up passing on the spot.

What is your policy on holding spots, deposits, and holding fees?
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  #2  
Old 04-11-2014, 10:51 AM
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Annalee Annalee is offline
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Quote:
Originally Posted by Asmithdaycare View Post
Last year I held a couple infant spots for almost 6 months and I was still pretty new to this so I only charged a 4 week deposit. After a while, I realized it was not worth my while to only charge so little to hold a spot for so long. I turned multiple people away for these spots while making no income on them until the babies started.

Fast forward, now I have a system in place where the deposits get larger, the farther out the start date is.
-2 weeks deposit for starting within 30 days.
-4 weeks for starting within 30-60 days
-8 weeks for starting within 60-120 days.
To hold a spot beyond 120 days and I begin collecting full tuition as a holding fee not to be credited towards future attendance. Whereas my deposits are applies to last 2 weeks of care, first 2 and last 2 weeks, and first 4 and last 4.

Lately, every family I interview that doesn't need the spot for several months (6+ where they would have to pay tuition after the deposit runs out), balk at how large the deposit is and the fact that they see paying the holding fee (tuition) as paying something for nothing.

I thought this was a great system, it protects me from huge financial losses while holding a spot. I am finding that people don't want to pay a $1500+ deposit to hold a spot (in my area the daily rate is $50+). So they end up passing on the spot.

What is your policy on holding spots, deposits, and holding fees?
I don't hold spots at all....if a client chooses not to take the spot when available I move on the the next client. This includes siblings being born.....if the spot comes open before infant is born or turns 6 weeks old, they still have a choice to take that spot or take a chance on me having a spot later.
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  #3  
Old 04-11-2014, 10:52 AM
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IF the spot is open, I require payment in full.

ALL rates are based on enrollment not attendance.

Sorry that is not much help but I can't afford to hold a spot for someone and infant and toddler space here is SUPER hard to find so it is what it is.
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  #4  
Old 04-11-2014, 11:13 AM
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Second Home Second Home is offline
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I do not hold spots . If for some reason I did then i would require some amount of payment for the spot .
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  #5  
Old 04-11-2014, 11:18 AM
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I don't see your deposit system really helping you. You still are going to get less money than if you filled the spot immediately. The "no pay" days are just spread out a bit differently.

The only way I hold a spot long term is if a family contacts me for a spot that I don't have open yet. For instance I have a child that is aging out for kindergarten this fall. I already have another child lined up to take that spot. I am not charging the new family, since my spot isn't empty.

If they want me to hold a spot they pay for it unless I can find someone else to fill it temporarily. There is a DC shortage in my area. I never have a hard time filling my spots. I won't go months without being paid.
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  #6  
Old 04-11-2014, 11:21 AM
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Annalee Annalee is offline
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Originally Posted by KSDC View Post
I won't go months without being paid.
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  #7  
Old 04-11-2014, 11:30 AM
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Quote:
Originally Posted by Asmithdaycare View Post
Last year I held a couple infant spots for almost 6 months and I was still pretty new to this so I only charged a 4 week deposit. After a while, I realized it was not worth my while to only charge so little to hold a spot for so long. I turned multiple people away for these spots while making no income on them until the babies started.

Fast forward, now I have a system in place where the deposits get larger, the farther out the start date is.
-2 weeks deposit for starting within 30 days.
-4 weeks for starting within 30-60 days
-8 weeks for starting within 60-120 days.
To hold a spot beyond 120 days and I begin collecting full tuition as a holding fee not to be credited towards future attendance. Whereas my deposits are applies to last 2 weeks of care, first 2 and last 2 weeks, and first 4 and last 4.

Lately, every family I interview that doesn't need the spot for several months (6+ where they would have to pay tuition after the deposit runs out), balk at how large the deposit is and the fact that they see paying the holding fee (tuition) as paying something for nothing.

I thought this was a great system, it protects me from huge financial losses while holding a spot. I am finding that people don't want to pay a $1500+ deposit to hold a spot (in my area the daily rate is $50+). So they end up passing on the spot.

What is your policy on holding spots, deposits, and holding fees?
I really love your idea! Something for nothing??!! You are giving them the credit towards future daycare. My question is what happens if the parents end up needing to be termed? What happens to the money paid in then?
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  #8  
Old 04-11-2014, 11:38 AM
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Quote:
Originally Posted by KSDC View Post
I don't see your deposit system really helping you. You still are going to get less money than if you filled the spot immediately. The "no pay" days are just spread out a bit differently.
This is what I was thinking too.

Also is the deposit refundable or not? < that seems to be a real sticking point for some parents/providers and not being REALLY clear about that often times leads to a huge hassle.
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  #9  
Old 04-11-2014, 11:54 AM
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EntropyControlSpecialist EntropyControlSpecialist is offline
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Quote:
Originally Posted by Annalee View Post
I don't hold spots at all....if a client chooses not to take the spot when available I move on the the next client. This includes siblings being born.....if the spot comes open before infant is born or turns 6 weeks old, they still have a choice to take that spot or take a chance on me having a spot later.
Exactly.

Like another poster, though, I have lined it up where another child coming in will take a child who is going to Kinder's spot. I require the regular 2 week security deposit fee (applied to the final two weeks of care) just to make sure they are serious about starting here. I do this for everyone, though, after having around 4 children fully enroll and then never show on their first day! PLUS, it helps to have the final two weeks already paid because I have had at least 5 people in the past year who have tried to leave suddenly and demand this fee back. Nope. Sorry dude.
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  #10  
Old 04-11-2014, 12:14 PM
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I dont even interview people needing care 6 months from now....waste of time. If you know that people wont want to pay what you are asking to hold the spot and that you wont hold it for free, why interview at all? Are you not getting interest from clients that need care more immediate? And so much can change in 6 months....namely the mom deciding to stay home. what then? do they get any deposit back?

I have had people email me about babies that are not even conceived yet LOL I dont interview with pregnant moms unless they are about to pop and have a short maternity leave, ha ha
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  #11  
Old 04-11-2014, 12:25 PM
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Quote:
Originally Posted by cheerfuldom View Post
I dont even interview people needing care 6 months from now....waste of time. If you know that people wont want to pay what you are asking to hold the spot and that you wont hold it for free, why interview at all? Are you not getting interest from clients that need care more immediate? And so much can change in 6 months....namely the mom deciding to stay home. what then? do they get any deposit back?

I have had people email me about babies that are not even conceived yet LOL I dont interview with pregnant moms unless they are about to pop and have a short maternity leave, ha ha
That's a good point too. I guess I was thinking more along the lines of currently enrolled families needing care for the new sibling.

I wouldn't hold a spot or even interview either. Unless I was just starting out and desperate to fill spots.
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  #12  
Old 04-11-2014, 12:39 PM
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Quote:
Originally Posted by cheerfuldom View Post
I dont even interview people needing care 6 months from now....waste of time. If you know that people wont want to pay what you are asking to hold the spot and that you wont hold it for free, why interview at all? Are you not getting interest from clients that need care more immediate? And so much can change in 6 months....namely the mom deciding to stay home. what then? do they get any deposit back?

I have had people email me about babies that are not even conceived yet LOL I dont interview with pregnant moms unless they are about to pop and have a short maternity leave, ha ha
This exactly. I had someone I know PM me recently on FB and ask about her baby who's due in June-July and she's going back in Oct. I told her to touch bases with me when the baby's born and she can come by and see things, and we'll go from there. I have someone turning 2 in Aug and in Oct so it would work out but I would never hold a spot that long unless someone wanted to pay at least a 50% rate non-refundable and that would be a fortune as it's about $50/day here too.

P.S.- sadly a DCM who I was going to work with lost her baby during delivery. It was very traumatic and I can't imagine the heartache of discussing a deposit return and such. She had another baby a year later and I watched her but after 2wks she decided to quit and be a SAHM!
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  #13  
Old 04-11-2014, 12:51 PM
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melilley melilley is offline
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I will interview if they need care at a later date, but I don't hold spots. I do this because it gets my name out there and also if a current dcf leaves then I may potentially have the spot filled.

I once did an interview with an expectant family, but told them I wasn't sure if I would have a spot open when baby came. Well I didn't have one open when they needed care, but they did give my name to other people who needed care! I thought it was awesome that even thought I couldn't take their infant, they still recommended me to others!
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  #14  
Old 04-11-2014, 01:20 PM
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Blackcat31 Blackcat31 is offline
 
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Quote:
Originally Posted by melilley View Post
I will interview if they need care at a later date, but I don't hold spots. I do this because it gets my name out there and also if a current dcf leaves then I may potentially have the spot filled.

I once did an interview with an expectant family, but told them I wasn't sure if I would have a spot open when baby came. Well I didn't have one open when they needed care, but they did give my name to other people who needed care! I thought it was awesome that even thought I couldn't take their infant, they still recommended me to others!
I don't hold spots and don't take a holding fee either but I still interview.

I interview anyways because if a space suddenly does become available, I want to have all the initial stuff completed so the space can be filled easily and without complications.
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  #15  
Old 04-11-2014, 02:18 PM
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I dont even take infants anymore but if a current family was expecting another child, the rule would be the same. Talk to me closer to your start date, no more than three months in advance. I cant guarantee anything just because it is a current family and to be honest, I prefer not to take siblings anyway. Good thing singletons are very common
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  #16  
Old 04-11-2014, 03:21 PM
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aDCProvider aDCProvider is offline
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Quote:
Originally Posted by butterfly View Post
I really love your idea! Something for nothing??!! You are giving them the credit towards future daycare. My question is what happens if the parents end up needing to be termed? What happens to the money paid in then?
If I had to term immediately for cause (non payment, disrespect, excessively not following policies), they forfeit the deposit. If I give a family notice, their deposit covers their last few weeks.
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  #17  
Old 04-11-2014, 03:22 PM
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Quote:
Originally Posted by Blackcat31 View Post
This is what I was thinking too.

Also is the deposit refundable or not? < that seems to be a real sticking point for some parents/providers and not being REALLY clear about that often times leads to a huge hassle.
The deposit is non refundable.
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  #18  
Old 04-11-2014, 04:29 PM
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I will not hold a spot for longer than 1 month. I do not credit any of the holding fee back to the parents. If they are looking and want to interview months in advance, I tell them to call me back closer to their desired start date or I will add them to my wait list and when I have an opening, I will call them.

You will never make that money back by holding spots for that long and most people will not be willing to shell the money out and get nothing out of it for a long period of time.
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  #19  
Old 04-11-2014, 05:11 PM
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Originally Posted by EntropyControlSpecialist View Post
Exactly.

Like another poster, though, I have lined it up where another child coming in will take a child who is going to Kinder's spot. I require the regular 2 week security deposit fee (applied to the final two weeks of care) just to make sure they are serious about starting here. I do this for everyone, though, after having around 4 children fully enroll and then never show on their first day! PLUS, it helps to have the final two weeks already paid because I have had at least 5 people in the past year who have tried to leave suddenly and demand this fee back. Nope. Sorry dude.
Seriously. Doesn't it make you want to say to them "people like you are exactly why I collect the last two weeks' payment upfront!"

As for original poster I don't see how it helps you to have the set up that you have. All the $ they pay goes towards future daycare and does nothing for the fact that you're sitting on an empty spot and not getting paid one cent for it. What happens if someone calls the next day and is ready to start next week? Then you really lose out.
They might be more willing to pay half tuition weekly or even full tuition weekly since they have to come up with less money up front.
Or have them call to see if you have space closer to the target start date.

If I know a family is looking for future care I usually won't even meet with them until a month before. It's a waste of my time.
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  #20  
Old 04-12-2014, 09:00 AM
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Ok Ladies, you're right! This system is not helping me, in fact it seems to be driving people away. I looked around at other daycares in my area, it seems the common hold time is 2-4 weeks, after that they charge full tuition to hold the space. Here is my new policy...

Deposits
A non-refundable deposit of 2 weeks tuition, based on the age of your child, is required to hold a spot for up to 30 days, and will be applied to your last 2 weeks of care.
If you would like to hold a spot for longer than 30 days, you must begin paying your contracted weekly tuition until your start date. These tuition payments are non refundable and will not be applied to a future balance. Late payment is subject to a $10.00 per day late fee. After 7 calendar days of late payment, the daycare spot and all monies paid to date will be forfeited.
All deposits are NON-REFUNDABLE. If, for any reason, you choose to forfeit your hold on a daycare spot, you also forfeit your deposit and all monies paid to date.

What do you think?
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  #21  
Old 04-12-2014, 09:40 PM
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Quote:
Originally Posted by Blackcat31 View Post
IF the spot is open, I require payment in full.

ALL rates are based on enrollment not attendance.

Sorry that is not much help but I can't afford to hold a spot for someone and infant and toddler space here is SUPER hard to find so it is what it is.
I certainly couldn't hold a spot for free (or a reduced price), either.

Rather than call it a deposit, I would just tell it like it is: I will hold a spot for up to 2 weeks without charge (because I WANT clients to give current daycares notice). After that, I charge my full-time minimum. I explain that it is NOT a deposit, but that they are paying for the space because they are USING the space.
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  #22  
Old 04-13-2014, 07:27 AM
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I would change the wording of deposit to holding fees.

They are getting something for nothing. They are ensuring their child has childcare when they need it. Why should forfeit income to ensure STRANGERS have childcare at their convenience?
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