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  #1  
Old 08-21-2019, 01:08 AM
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Default Why Do Daycares Use Waitlists Instead of Raising Prices to Meet The Demand?

I've been looking into the pricing of daycares here in Seattle and one thing was surprising to me - for some reason all daycares have huge waitlists, with some parents reporting they've spent up to three years trying to get a spot. There are also "waitlist fees" if you want to get on the waitlist in the first place.

Now, the fact that there aren't enough daycares in major metropolitan areas is well known and this doesn't surprise me. But why would daycares choose to use long waitlists instead of just raising the prices until supply meets the demand? I mean, other service providers generally don't force you to wait in line for years and just vary the pricing based on the number of customers.

So I was hoping that Daycare members could resolve my question and explain the reasoning behind such policies. Is it to ensure that no spots are ever vacant? Is it to avoid a backlash from angry parents? Is it to help out struggling parents who would be priced out otherwise?
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Old 08-21-2019, 05:29 AM
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My waitlist is about 3 years, now. I charge what I need to earn to meet my financial obligations, keep an emergency fund and life insurance, take a couple of vacations per year and fund my IRA. It has nothing to do with whom is on the list. I also have no desire to earn more, more money = more problems in my experience. I love my life as it is.

My tuition rate is fixed, increases yearly (just like my clients' wages) and reflects inflation in my region. I am not sure what you mean by "vary the pricing based on the number of customers". It has nothing to do with the number of customers, that is a fixed number, too, set by my regulations. I did not choose it and feel it is low for my ability.
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Old 08-21-2019, 06:08 AM
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With my daycare I was finding that most of my kids were starting to leave at 3 1/2 yrs old. How can you have a 3 year waitlist, wouldn't they be aged out by then? Or are they parents that are not yet pregnant?
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Old 08-21-2019, 06:17 AM
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Originally Posted by lovemykidstoo View Post
With my daycare I was finding that most of my kids were starting to leave at 3 1/2 yrs old. How can you have a 3 year waitlist, wouldn't they be aged out by then? Or are they parents that are not yet pregnant?
I have many parents TTC on the list, one of my current clients is still trying and keeping the slot. I won't have an opening for at least 3 years.

I also keep them until age 6. Redshirting is common here.
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Old 08-21-2019, 06:24 AM
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I have many parents TTC on the list, one of my current clients is still trying and keeping the slot. I won't have an opening for at least 3 years.

I also keep them until age 6. Redshirting is common here.
Thanks! I was curious. Here it seems that as soon as those parents can get their kids to kindergarten (free), they do it no matter if the child is ready or not.
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Old 08-21-2019, 06:29 AM
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Thanks! I was curious. Here it seems that as soon as those parents can get their kids to kindergarten (free), they do it no matter if the child is ready or not.
That was my experience as well for many years, then the mill and several large farms closed. New artsy, tourist, golf, resort and "event" markets opened. And finally, there was an influx of new subdivisions, condos and adult living. The community changed pretty quickly.

I am also the only star rated family provider in town right now.
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Old 08-21-2019, 07:44 AM
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Originally Posted by Cat Herder View Post
I have many parents TTC on the list, one of my current clients is still trying and keeping the slot. I won't have an opening for at least 3 years.

I also keep them until age 6. Redshirting is common here.
Love the ďredshirtingĒ terminology. College football is upon us!
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Old 08-21-2019, 08:24 AM
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Originally Posted by Myst_Seattle View Post
I've been looking into the pricing of daycares here in Seattle and one thing was surprising to me - for some reason all daycares have huge waitlists, with some parents reporting they've spent up to three years trying to get a spot. There are also "waitlist fees" if you want to get on the waitlist in the first place.

Now, the fact that there aren't enough daycares in major metropolitan areas is well known and this doesn't surprise me. But why would daycares choose to use long waitlists instead of just raising the prices until supply meets the demand? I mean, other service providers generally don't force you to wait in line for years and just vary the pricing based on the number of customers.

So I was hoping that Daycare members could resolve my question and explain the reasoning behind such policies. Is it to ensure that no spots are ever vacant? Is it to avoid a backlash from angry parents? Is it to help out struggling parents who would be priced out otherwise?
Im confused. Are you asking why daycares don't raise prices until the majority of people can't afford it and then drop off the waitlist?

It why they don't increase prices to hire more staff so they can enroll more kids?
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Old 08-21-2019, 08:51 AM
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Apologies for not being clear enough. If there's a daycare like Cat Herder's where the waitlist is at 3 years, it should in theory be possible to keep increasing the price every year until the waitlist is at 6 months or less as more and more parents are being priced out of the daycare. But in practice daycares don't seem to do it or at least the ones in Seattle don't.
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Old 08-21-2019, 09:47 AM
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Apologies for not being clear enough. If there's a daycare like Cat Herder's where the waitlist is at 3 years, it should in theory be possible to keep increasing the price every year until the waitlist is at 6 months or less as more and more parents are being priced out of the daycare. But in practice daycares don't seem to do it or at least the ones in Seattle don't.
So, what your suggesting is to price daycare services out of the realm of typical salaries and only cater to the elite who can afford extravagant prices? In order to trim waitlists?

Why wouldn't those customers just choose a nanny service then? It seems to be the likely outcome of price gauging.
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Old 08-21-2019, 10:15 AM
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Apologies for not being clear enough. If there's a daycare like Cat Herder's where the waitlist is at 3 years, it should in theory be possible to keep increasing the price every year until the waitlist is at 6 months or less as more and more parents are being priced out of the daycare. But in practice daycares don't seem to do it or at least the ones in Seattle don't.
That makes zero sense.

Daycare is a huge cost already for working parents so raising rates isn't going to be a benefit for anyone.

Those with bigger wallets have more options but regardless my issue is that I am limited to x number of spaces and despite the fact that my wait list is also pretty lengthy, raising my rates isn't going to change the maximum capacity the state allows me to have.
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Old 08-21-2019, 10:23 AM
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Apologies for not being clear enough. If there's a daycare like Cat Herder's where the waitlist is at 3 years, it should in theory be possible to keep increasing the price every year until the waitlist is at 6 months or less as more and more parents are being priced out of the daycare. But in practice daycares don't seem to do it or at least the ones in Seattle don't.
No idea why! No idea why some providers insist on offering services for WELL below market value either, thus keeping rates low...or why providers don’t unionize, band together and increase pay and working conditions. My guess and I do not mean for this to sound offensive is that most providers are only in it for the short term and have low education/know very little about business.
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Old 08-21-2019, 10:25 AM
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That makes zero sense.

Daycare is a huge cost already for working parents so raising rates isn't going to be a benefit for anyone.

Those with bigger wallets have more options but regardless my issue is that I am limited to x number of spaces and despite the fact that my wait list is also pretty lengthy, raising my rates isn't going to change the maximum capacity the state allows me to have.
I think they mean that you will have higher paying customers on your waitlist since most would drop off if they couldnít afford you. So rather than having 200 people waiting for a $50 a day space, you could have 10 waiting for a $70 a day space. It makes sense to me!
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Old 08-21-2019, 10:29 AM
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I think they mean that you will have higher paying customers on your waitlist since most would drop off if they couldnít afford you. So rather than having 200 people waiting for a $50 a day space, you could have 10 waiting for a $70 a day space. It makes sense to me!
No, it just means only those that have more money can find child care.

I charge a higher rate than most in my area and I also have the longest wait list so where is the correlation?
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Old 08-21-2019, 10:32 AM
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No, it just means only those that have more money can find child care.

I charge a higher rate than most in my area and I also have the longest wait list so where is the correlation?
Yes and only those who can afford a brand new IPhone buy one. It is the law of supply and demand. So if you are in high demand, raise your prices more. That is how supply and demand works. Itís why gas prices go up and down depending on circumstances.

I charge pretty much the same as I did when I opened 10 years ago because there are so many providers charging bottom barrel prices for such a highly sought after service. They have the idea that cheaper will attract more clients.
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Old 08-21-2019, 10:41 AM
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I will say though that the market might end up levelling itself out. As childcare becomes more lucrative more people will get into it and since you donít need any real education or skills to do it (at least where I am) there is no deterrent to pursuing it, thus increasing supply and bringing down prices.
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Old 08-21-2019, 10:43 AM
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Yes and only those who can afford a brand new IPhone buy one. It is the law of supply and demand. So if you are in high demand, raise your prices more. That is how supply and demand works. Itís why gas prices go up and down depending on circumstances.

I charge pretty much the same as I did when I opened 10 years ago because there are so many providers charging bottom barrel prices for such a highly sought after service. They have the idea that cheaper will attract more clients.
I understand how supply and demand works.

Raising my rates simply because the demand is there isn't the answer. People can't afford to pay more than a certain amount. No matter what the supply and demand is.

S/D doesn't always apply to the child care business.
Theory is great but reality is more important.
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Old 08-21-2019, 10:45 AM
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Yes and only those who can afford a brand new IPhone buy one. It is the law of supply and demand. So if you are in high demand, raise your prices more. That is how supply and demand works. Itís why gas prices go up and down depending on circumstances.

I charge pretty much the same as I did when I opened 10 years ago because there are so many providers charging bottom barrel prices for such a highly sought after service. They have the idea that cheaper will attract more clients.



I disagree with this theory. There are tons of unlicensed legal and illegal offering services in my state for rock bottom prices, but this doesn't change what I charge nor how I run my business regarding anything else. I am full with a waiting list and run my program like a business. I am open less hours than most but still remain full. I charge 52 weeks per year but still remain full. I do what works for me to support my own family.

As for education, I do have an AS degree, but business sense doesn't always come from a college. Life lessons with hard knocks along with a special mentor taught me alot!
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Old 08-21-2019, 10:46 AM
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I understand how supply and demand works.

Raising my rates simply because the demand is there isn't the answer. People can't afford to pay more than a certain amount. No matter what the supply and demand is.

S/D doesn't always apply to the child care business.
Theory is great but reality is more important.
It works perfectly here actually. SOME people can’t afford to pay more but some people can. SOME people would just have to sacrifice more or think harder about the choice to have children. The way things are now, parents tend to feel entitled to cheap care but buy brand new cars. Or complain about childcare fees while producing more kids and the provider can barely make ends meet. Maybe it would help society if childcare cost more.

I had a mom interview and tell me my rates were too high for their budget. I said ok and sent them on their way. A week later she contacted me....they magically found the money. Why? Because the supply of quality care is low.
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Old 08-21-2019, 11:34 AM
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No idea why! No idea why some providers insist on offering services for WELL below market value either, thus keeping rates low...or why providers donít unionize, band together and increase pay and working conditions. My guess and I do not mean for this to sound offensive is that most providers are only in it for the short term and have low education/know very little about business.
I charge average rates, and I do NOT want to unionize. Being self employed means making my own rules and setting my own rates...a union would only hurt, not help that.
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Old 08-21-2019, 12:10 PM
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The truth? Most of the providers here are legally unlicensed and don't have more than CDAs. They also don't want to do school prep. Who is going to pay high prices for that?

Many are also rude to parents and want (usually low paying) parents they can term left and right when they feel like pulling a hissy fit.
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Old 08-21-2019, 12:10 PM
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Thanks! I was curious. Here it seems that as soon as those parents can get their kids to kindergarten (free), they do it no matter if the child is ready or not.
This is so true. I had two parents sign wavers to get their children in a year early. The one is so behind as it is. The other has fits when she doesnít get her way and is kind of mean about it. Iím absolute sick that the parents are doing this. My heart just hurts that they are already telling these parents their kids will get held back for kindergarten. My food program lady pretty much said it like it is. She said that the parents are only doing it for financial reasons. Itís so sad.
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Old 08-21-2019, 12:11 PM
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No idea why! No idea why some providers insist on offering services for WELL below market value either, thus keeping rates low...or why providers donít unionize, band together and increase pay and working conditions. My guess and I do not mean for this to sound offensive is that most providers are only in it for the short term and have low education/know very little about business.
They don't want to follow standards. I'm a licensed teacher with an MA and have taught in public schools. Many of the posters here aren't qualified to be aides.
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Old 08-21-2019, 12:33 PM
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I charge average rates, and I do NOT want to unionize. Being self employed means making my own rules and setting my own rates...a union would only hurt, not help that.
Yes I totally get it! Union jobs though offer higher wages, automatic raises with inflation and seniority, pensions, more time off and more benefits.
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Old 08-21-2019, 12:37 PM
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[/b]


I disagree with this theory. There are tons of unlicensed legal and illegal offering services in my state for rock bottom prices, but this doesn't change what I charge nor how I run my business regarding anything else. I am full with a waiting list and run my program like a business. I am open less hours than most but still remain full. I charge 52 weeks per year but still remain full. I do what works for me to support my own family.

As for education, I do have an AS degree, but business sense doesn't always come from a college. Life lessons with hard knocks along with a special mentor taught me alot!
I also charge higher fees, always have but cannot price myself completely out of the market. I have recently increased my 8-10 hour rate to roughly $12 a day more than most providers and people are still paying it. I have an education and run my daycare really well so it is high quality which some people are willing and able to pay for.
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Old 08-21-2019, 01:12 PM
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Yes I totally get it! Union jobs though offer higher wages, automatic raises with inflation and seniority, pensions, more time off and more benefits.
Unions sell that idea to people buts itís not how it actually works here.
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Old 08-21-2019, 02:47 PM
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They don't want to follow standards. I'm a licensed teacher with an MA and have taught in public schools. Many of the posters here aren't qualified to be aides.
Was there a thread somewhere in which everyone shared their education levels? If so I haven't seen it but I don't think it matters anyways as many of the posters here ARE more qualified than you think and most know more about children and their development than many others do.

A degree does not make you better than anyone else.
Paper isn't worth whatever is printed on it IF it isn't in conjunction with hands on experience and quality.

SMH at some of the offensive statements I've read lately.
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Old 08-21-2019, 02:52 PM
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SMH at some of the offensive statements I've read lately.
Mines bigger than yours.

Wait, wrong job site...

Wait, no that seems about right.

If only parroting what the professor says for a solid A would just equate to hands-on skills and business management ability, gosh golly.
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Old 08-21-2019, 02:59 PM
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They don't want to follow standards. I'm a licensed teacher with an MA and have taught in public schools. Many of the posters here aren't qualified to be aides.
That's where you are so wrong; many of us are very qualified & we have degrees... I myself was a Sub teacher in a rural area of in TN when my youngest child was 10 (they had more regular substitutes than actual teachers many days).

My clients chose me because I speak more than one language & I did teach my daycare babes. I had a very multi-cultural childcare home for many years (I closed last year), so don't state something you don't know for a fact. I worked in the Legal field for 15 years before teaching & childcare
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Old 08-21-2019, 03:17 PM
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That makes zero sense.
Those with bigger wallets have more options but regardless my issue is that I am limited to x number of spaces and despite the fact that my wait list is also pretty lengthy, raising my rates isn't going to change the maximum capacity the state allows me to have.
I fully agree that it won't let you increase your capacity, but in theory it should increase your profit margin. Let's say you are currently charging $100 per week and have a 3 year waitlist. If you increase it to $110 (for new clients) the waitlist might drop to 2 years. If you further increase it to $120 it might go down to 1 year. Therefore your revenue would increase by 20% without having to take up any extra work.

It would price out some parents out of the daycare market, but at the same time it would help parents who have recently moved into the neighborhood and haven't had a chance to sign up for the waitlist three years ago. That's an issue faced by many of my parent colleagues who are new to Seattle.
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Old 08-21-2019, 03:47 PM
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Unions sell that idea to people buts itís not how it actually works here.
Same here. The union stated specifically that they would work to increase wages for child care providers but that they wouldn't address working conditions, state regulations, etc. I can see where a union might benefit center workers in terms of raising their rate of pay but see little to no benefit for independent family child care providers.
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Old 08-21-2019, 03:57 PM
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Was there a thread somewhere in which everyone shared their education levels? If so I haven't seen it but I don't think it matters anyways as many of the posters here ARE more qualified than you think and most know more about children and their development than many others do.

A degree does not make you better than anyone else.
Paper isn't worth whatever is printed on it IF it isn't in conjunction with hands on experience and quality.

SMH at some of the offensive statements I've read lately.
What degree do you hold?
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Old 08-21-2019, 03:58 PM
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That's where you are so wrong; many of us are very qualified & we have degrees... I myself was a Sub teacher in a rural area of in TN when my youngest child was 10 (they had more regular substitutes than actual teachers many days).

My clients chose me because I speak more than one language & I did teach my daycare babes. I had a very multi-cultural childcare home for many years (I closed last year), so don't state something you don't know for a fact. I worked in the Legal field for 15 years before teaching & childcare
What was your job? I know people in the "legal field" who are secretaries and have only graduated high school. Law firms even need custodians.
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Old 08-21-2019, 04:18 PM
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I fully agree that it won't let you increase your capacity, but in theory it should increase your profit margin. Let's say you are currently charging $100 per week and have a 3 year waitlist. If you increase it to $110 (for new clients) the waitlist might drop to 2 years. If you further increase it to $120 it might go down to 1 year. Therefore your revenue would increase by 20% without having to take up any extra work.
This isn't actually true either. I raise my rates pretty regularly and it doesn't seem to make a difference as to the length of my waitlist.

The biggest issue in my area and the reason there is such a long waitlist is there are so many parents that want part time, sporadic care and want to pay only for the hours or days they use. That doesn't work well for a child care provider trying to earn an income themselves and while staying within ratios.

My waitlist has actually grown more as I've charged more. Go figure. lol! I can't explain that logic so I don't even try.

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It would price out some parents out of the daycare market, but at the same time it would help parents who have recently moved into the neighborhood and haven't had a chance to sign up for the waitlist three years ago. That's an issue faced by many of my parent colleagues who are new to Seattle.
The thing about waitlists too that many aren't realizing or mentioning is it isn't first come first served so those last signing up to wait might sometimes be first served.

For me, it's about who FITS whatever opening I currently have. Does that make sense? So in reality a new family moving into the neighborhood and just signing on to the wait list might only wait 2 months for care verses someone on the list that has been waiting 3 yrs.

Best fit trumps first on the list.

Hopefully that makes more sense.
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Old 08-21-2019, 04:26 PM
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What degree do you hold?
NYB.


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What was your job? I know people in the "legal field" who are secretaries and have only graduated high school. Law firms even need custodians.
Some of the smartest, nicest, most wonderful caring people I know never even graduated high school.

...and I am pretty sure that at the end of it all, the only thing listed on ones head stone is their date of birth and date of death. The rest isn't important. Especially if you truly believe a degree makes you better than anyone else.

I have zero interest in running in circles around someone who simply types the words "I have a degree" and thinks they are worthy of a decent conversation.

Have a great night!
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Old 08-21-2019, 04:46 PM
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What was your job? I know people in the "legal field" who are secretaries and have only graduated high school. Law firms even need custodians.
Does this sound derogatory to anyone else?
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Old 08-21-2019, 04:51 PM
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This isn't actually true either. I raise my rates pretty regularly and it doesn't seem to make a difference as to the length of my waitlist.

My waitlist has actually grown more as I've charged more. Go figure. lol! I can't explain that logic so I don't even try.
In this case, wouldn't you want to keep increasing the price until you reach the "breaking point" and start seeing a decrease in the queue? I mean, it's basically free money as you'd get paid more for doing the exact same job.
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Old 08-21-2019, 04:53 PM
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Was there a thread somewhere in which everyone shared their education levels?
This might be it. The thread is from 2010: https://www.daycare.com/forum/showthread.php?t=24163
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Old 08-21-2019, 05:11 PM
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Does this sound derogatory to anyone else?
There are several comments that sound derogatory to me. It's unfortunate and unnecessary.
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Old 08-21-2019, 05:25 PM
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Unions sell that idea to people buts itís not how it actually works here.
That's totally how it works here. I made more at my union job 20 years ago than I could make in the workforce now. I wasn't rich, but I made a FAIR wage, that was more equitable than people make now. I had great healthcare, a pension, and a contract between us (union employees) and the company that we BOTH agreed on and felt good about. If I could choose union/non-union, it would be union every time. Another benefit for the entire community? Other companies would set their wages more in accordance with my company to recruit and retain employees. My entire community was better off when we had this union company (the city's largest employer). Companies now are literally starting at $3-$4 an hour LESS than what I made 20 years ago.
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Old 08-21-2019, 06:38 PM
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I had a union job and it was the best paying ECE job in my City by a very wide margin. People just starting were hired at $45,000 and that was 10 yrs ago. Plus benefits, sick time etc etc.

Every person I know who is in a union makes more than they would in the private sector.

Too bad this interesting discussion has derailed into a pissing contest as usual
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Old 08-21-2019, 09:34 PM
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If you're not happy with your wages

Last edited by nannyde; 08-22-2019 at 04:23 AM.
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Old 08-22-2019, 03:40 AM
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Just my comments:
1) While it's not at the top of my list of concerns for parents, I still worried about whether I was affordable.
2) I honestly wouldn't have wanted to be filled with dcfs that could only afford top prices because some of them feel very entitled and expect special for the high prices.
3) Wait lists aren't all they're cracked up to be. By the time their name came up, other dc had been found. This is from when I was lucky enough to accumulate several names so take that thought for what it's worth.
4) JMO, but experience with children, dedication, love and compassion play just as much of a role as your so-called book learning, certificates and education.
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Old 08-22-2019, 06:52 AM
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I donít feel the need to do anything to shorten a waiting list. Itís just not a concern for me. Iíll just keep doing my job, and enrolling families that fit well here.
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Old 08-22-2019, 07:10 AM
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The only thing unions help are themselves

The only benefit for the individual is a higher wage.

But at who's cost?

Unions are/were the downfall of the economy in my area
They are/were the downfall of automakers.

Unions help unions get rich but at who's expense?

Unions have also wrecked the steel and textile industries and have helped drive manufacturing jobs overseas.

They've ruined public education and cost tax payers billions of dollars and are bankrupting cities and states. (Wisconsin is a perfect example).

If unions were so wonderful, why aren't child care providers flocking to join them? Why aren't child care providers shouting from roof tops how beneficial and helpful unions are to this profession?

Unions have turned the American dream into a nightmare.
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Old 08-22-2019, 08:47 AM
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Originally Posted by Josiegirl View Post
Does this sound derogatory to anyone else?
Most certainly!

Unregistered:
A good licensed, educated teacher would never portray the self righteous, judgmental attitude you are displaying here.
Good teachers have compassion for others, see worth in all people, teach children and young adults how to treat others and the world they inherit with kindness. I take pity on the ones who will be subject to your wrath.


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My guess and I do not mean for this to sound offensive is that most providers are only in it for the short term and have low education/know very little about business.
I have to say, that comment really rubbed me the wrong way. That statement couldn't be further from the truth. Maybe where you live, that's what you're seeing. In my area, we take pride in our field. Many of us have had years of early childhood education and training. I don't know too many fields that require the ongoing training we do here.

In regards to short term: The providers I know have 10 years or more under their belt. Myself included.
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Old 08-22-2019, 12:37 PM
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I charge more for infants AND require full time Carr
I do this because itís needed in my community AND spots are rare.
Same way other places do it. Higher demand, less Ďproductí and less spots.
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Old 08-22-2019, 12:40 PM
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3) Wait lists aren't all they're cracked up to be. By the time their name came up, other dc had been found. This is from when I was lucky enough to accumulate several names so take that thought for what it's worth.
Yep! Exactly. I have never bothered having a wait list. The parents find other care. They aren’t all just waiting around with no daycare.

Last edited by Michael; 08-22-2019 at 12:51 PM.
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Old 08-22-2019, 02:29 PM
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They arenít all just waiting around with no daycare.
Here in Seattle a lot of parents do end up waiting for a long time. Getting a full-time nanny is an alternative solution, but good nannies are very hard to find.

Some parents might also find a daycare that's far from where they live, instead of being able to send their kid to the closest location. Some are only able to find a part-time option while they want a full-time option. None of this would be an issue if waiting lists didn't exist.
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Old 08-22-2019, 02:44 PM
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I fully agree that it won't let you increase your capacity, but in theory it should increase your profit margin. Let's say you are currently charging $100 per week and have a 3 year waitlist. If you increase it to $110 (for new clients) the waitlist might drop to 2 years. If you further increase it to $120 it might go down to 1 year. Therefore your revenue would increase by 20% without having to take up any extra work.

It would price out some parents out of the daycare market, but at the same time it would help parents who have recently moved into the neighborhood and haven't had a chance to sign up for the waitlist three years ago. That's an issue faced by many of my parent colleagues who are new to Seattle.
Why do you assume that the waitlist would drop due to a rate increase? The need for childcare will still be there regardless of a rate increase.
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Old 08-22-2019, 02:50 PM
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Here in Seattle a lot of parents do end up waiting for a long time. Getting a full-time nanny is an alternative solution, but good nannies are very hard to find.

Some parents might also find a daycare that's far from where they live, instead of being able to send their kid to the closest location. Some are only able to find a part-time option while they want a full-time option. None of this would be an issue if waiting lists didn't exist.
Can you elaborate on that thought process?

I don't understand how you are coming up with these conclusions.... although it could be a simple misunderstanding in regards to parent perspective and provider perspective.

But if you could explain how eliminating wait lists would fix the issues you mentioned I would appreciate it.
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Old 08-22-2019, 02:52 PM
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None of this would be an issue if waiting lists didn't exist.
Thatís ludicrous. Waitlists will cease to exist when there are enough options for families to find adequate care. Price gouging does nothing to eradicate that.

I would bet good money that the lack of daycare in your area is due to licensing restrictions and mandated policies they inflict on their local providers. Many states make it near impossible to make a good profit with their ratio restrictions. On top of that, state representatives who have never stepped foot in a daycare impose statute after statute of mandated procedures that make this job dreadfully complicated. As a result, that drives providers out of business by the dozens.

If you truly want to make a change in the daycare supply, write to your representatives. Let them know that the public (you) wants changes. That they should make this professional a priority and appealing to future providers by giving them resources they need and freedom in their business, instead of pushing them out in the name of ďuniversal pre-kĒ.
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Old 08-22-2019, 03:08 PM
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Why do you assume that the waitlist would drop due to a rate increase? The need for childcare will still be there regardless of a rate increase.
The need would still be there, but you won't have to wait for it. Just like you can always buy a plane ticket for Christmas, even if it costs a lot more than on other days. Likewise it is easy to buy a house in Seattle, although you need a lot of money to afford one.

Quote:
Can you elaborate on that thought process?
Having a long waiting list means parents who both want to work full-time are unable to do so, even if they have the funds to pay for childcare. I personally know people who are struggling with this issue. Increasing the price would increase the profitability of daycares and make access to their services easier to plan for.

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Waitlists will cease to exist when there are enough options for families to find adequate care. Price gouging does nothing to eradicate that.
It is easy to demonstrate why this is true with an exaggerated example. Let's say you increase your daycare price to $100,000 per week. At those rates only someone like Bill Gates would be able to afford it and the waitlist would be gone. Obviously you can't charge $100k per week, but there is always a price point at which the waiting list would become minimal without hurting your profitability. In economic theory this is referred to as the "supply and demand" curve.

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If you truly want to make a change in the daycare supply, write to your representatives.
I completely agree that overregulation is the root cause of the daycare deficit! However that doesn't explain the business practices of daycares in the existing legal environment
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Old 08-22-2019, 03:39 PM
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Your theory however does not work in all economic areas...:

As I have already said I charge a lot more than other area daycares do. (Almost double) Many of them have openings they canít fill.

I have a lengthy waitlist...a waitlist that has grown as my rates have grown. So how does your theory work when applied to me?

The business of child care is not the same as The business of selling a product ....

Itís also important to remember that most childcare providers are looking to make an income but they are not in this business so that they can rob hard-working parents
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Old 08-22-2019, 04:08 PM
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Your theory however does not work in all economic areas...:

As I have already said I charge a lot more than other area daycares do. (Almost double) Many of them have openings they canít fill.

I have a lengthy waitlist...a waitlist that has grown as my rates have grown. So how does your theory work when applied to me?
This just means that you have a superior product and people are willing to pay your company more than to competition. You could most likely increase the prices even more while still working at full capacity. Similarly Paul McCartney's concerts regularly sell out while small time bands struggle with attendance rates. Paul's product is superior and he can make more money from it than others in the business.

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Itís also important to remember that most childcare providers are looking to make an income but they are not in this business so that they can rob hard-working parents
If the explanation is that you are consciously lowering your profit margins to help out struggling parents, then it makes perfect sense! Although I'm not sure this explains why corporations like Bright Horizons also has waitlists.
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Old 08-22-2019, 04:09 PM
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In the $100,000/week example, sure, it eliminates the waiting list. But who did it help, besides the Bill Gates person and the daycare provider?

As others have pointed out, our maximum allowed ratios do not change, no matter how high we raise our rates. This whole concept of raising rates to eliminate waiting lists is just ludicrous. The parents sitting at home waiting for daycare would still be doing that even if I doubled or tripled my rates.
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Old 08-22-2019, 06:37 PM
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In the $100,000/week example, sure, it eliminates the waiting list. But who did it help, besides the Bill Gates person and the daycare provider?
By increasing the prices you're helping:

1. Yourself as the business owner, as your profit margins go up. This might additionally incentivize you to expand the daycare in the future.
2. Daycare employees (if there are any) might see an increase in salary
3. Parents will have more flexibility as they know wait times for daycare are short

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As others have pointed out, our maximum allowed ratios do not change, no matter how high we raise our rates.
The ratios don't change, but your income per customer will increase.

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This whole concept of raising rates to eliminate waiting lists is just ludicrous. The parents sitting at home waiting for daycare would still be doing that even if I doubled or tripled my rates.
If you double your rates a certain percentage of parents will no longer be able to afford your daycare and would drop off the waitlist. If you triple the rates even more parents will drop off. Nobody has infinite money Obviously this wouldn't address the problem of daycare shortage as the number of available spots won't increase, but it would address the issue of waiting lists causing issues for parents.
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Old 08-22-2019, 07:17 PM
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By increasing the prices you're helping:

1. Yourself as the business owner, as your profit margins go up. This might additionally incentivize you to expand the daycare in the future.
2. Daycare employees (if there are any) might see an increase in salary
3. Parents will have more flexibility as they know wait times for daycare are short



The ratios don't change, but your income per customer will increase.



If you double your rates a certain percentage of parents will no longer be able to afford your daycare and would drop off the waitlist. If you triple the rates even more parents will drop off. Nobody has infinite money Obviously this wouldn't address the problem of daycare shortage as the number of available spots won't increase, but it would address the issue of waiting lists causing issues for parents.
Can you tell us your story? What happened to you, that makes you upset with the wait list? Are you currently waiting for for an opening?
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Old 08-22-2019, 07:39 PM
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Can you tell us your story? What happened to you, that makes you upset with the wait list? Are you currently waiting for for an opening?
I'm not waiting for an opening right now, but I would have to be if I decide to have a child in Seattle. I'm also surrounded by people who've recently moved to the city and are struggling to find daycare.

This isn't an issue when it comes to other expenses: for example its fairly easy to find a property to buy/sell, although it's very expensive compared to the rest of WA state. And there aren't queues in IKEA for baby cribs or other child expenses
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Old 08-23-2019, 04:01 AM
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I don't see the answer to the Seattle kind of dilemma as pricing the normal income family out of the dc possibility completely or leaving them with the lowest possible standard dc that can be afforded. I see the dilemma as being solved by increasing the # of available quality child care options. When states stop making the hoops so difficult to jump through and start giving providers more support, more respect, in regards to being in the profession then maybe the dilemma will improve. When they can gather funding to help pay the costs of dc(which is already exorbitant in some places) more than they do currently, then things will improve.

States have taken away financial support while increasing their regulations and requirements in recent years, making it more and more difficult for a provider to be able to stay in business or *want* to stay in business. Nothing burns a provider out more than constantly giving giving giving of their time and money to stay in regulation.
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Old 08-23-2019, 07:26 AM
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I'm not waiting for an opening right now, but I would have to be if I decide to have a child in Seattle. I'm also surrounded by people who've recently moved to the city and are struggling to find daycare.

This isn't an issue when it comes to other expenses: for example its fairly easy to find a property to buy/sell, although it's very expensive compared to the rest of WA state. And there aren't queues in IKEA for baby cribs or other child expenses
So is that what is bothering you? That you feel waitlist as turning children into names, not numbers? I get that, I would never want to feel like my child was a number to her teacher. (although they are assigned a number every year)

Well, it sounds like you may be very passionate about this, my question is, outside of posting here, what is your next step to fix the problem that you are seeing?

Others have suggested that you write the lawmakers, is that what you are planning on doing?
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Old 08-23-2019, 07:40 AM
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The need would still be there, but you won't have to wait for it. Just like you can always buy a plane ticket for Christmas, even if it costs a lot more than on other days. Likewise it is easy to buy a house in Seattle, although you need a lot of money to afford one.



Having a long waiting list means parents who both want to work full-time are unable to do so, even if they have the funds to pay for childcare. I personally know people who are struggling with this issue. Increasing the price would increase the profitability of daycares and make access to their services easier to plan for.



It is easy to demonstrate why this is true with an exaggerated example. Let's say you increase your daycare price to $100,000 per week. At those rates only someone like Bill Gates would be able to afford it and the waitlist would be gone. Obviously you can't charge $100k per week, but there is always a price point at which the waiting list would become minimal without hurting your profitability. In economic theory this is referred to as the "supply and demand" curve.



I completely agree that overregulation is the root cause of the daycare deficit! However that doesn't explain the business practices of daycares in the existing legal environment
Ok, let's break this down into real-world.

Your supply and demand theory is seriously flawed when it comes to this particular issue (waitlist) and this industry.

Let's pretend for a moment that Provider Amy does as you suggest and raises her rates- double what she currently charges. She lets everyone on her waitlist know that's what she's doing.
Likely, nobody on her waitlist will drop because they are not currently paying her that rate until they enroll. They will wait to make that decision until they know if they have a spot.

Provider Amy then lets her current clients know she's doubling their rate. For argument's sake, let's say 3/4 of them can't afford that and leave.
Amy then goes through her waitlist only to find that 1 of them will pay double fees.... she's not making any additional profit with this new fee.
She's lost 3/4 of her clients who used to pay reasonable fees and only gained one who pays more.
She's now working TWICE as hard in the future to find those clients who will fill those premium $ spots, because those clients are few and far between. She also takes a higher risk when those clients leave for the inevitable name brand preschools (the spots will be vacant-making $0).

While those spots are vacant- insurance and utilities are still due, licensing costs money and zero is being contributed to her retirement funds.

Had she kept her reasonable fee, her clients likely stay longer in the long run (in-home typically costs less than centers and less than formal preschools), which means less turn over, less advertising, less effort and supplies used to fill vacant spots (that again- make $0). She would also be making a nominal fee from waitlists (IF she charges one) and again, working less to fill spots when children age out or leave. Job security.

Sure, your waitlist may be gone but Provider Amy did not profit and works harder to find the $ in the haystack. You may think that "well, when the clients DO come, there won't be a wait for them". True. But Amy took a loss waiting for them.

There are so many behind the scenes intricacies of this business that so many outsiders don't realize.
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Old 08-23-2019, 09:08 AM
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Let's pretend for a moment that Provider Amy does as you suggest and raises her rates- double what she currently charges. She lets everyone on her waitlist know that's what she's doing.
Likely, nobody on her waitlist will drop because
Provider Amy then lets her current clients know she's doubling their rate. For argument's sake, let's say 3/4 of them can't afford that and leave.
Amy then goes through her waitlist only to find that 1 of them will pay double fees.... she's not making any additional profit with this new fee.
She's lost 3/4 of her clients who used to pay reasonable fees and only gained one who pays more.
Thank you for the response, now we're finally getting to a real answer So you're saying people won't drop off the waitlist but would refuse the spot eventually and leave you with no clients in the end? Or in other words daycare providers don't have a stable supply of customers and prefer a long waitlist to maintain job security?

However your example is flawed as it represents a bad business practice. Real life businesses do this differently:

1. You start with a price of $100/week and a waitlist of two years
2. You keep the same price for existing customers but raise the price for anyone joining next year to $120
3. As you go through the waitlist it shortens and now your waitlist is 1.5 years long
4. Next year you raise your price for new customers by another 20% to $150
5. After going through the waitlist you've now shortened it to 1 year only and stop raising your fees

That's how my local barbershop which suddenly became very popular did this. I still pay the same fee as I did a few years back, but new customers have to pay 50% more. They are now considering increasing the price even more, as they still have more customers than they can handle.

An alternative option is to have a fee to skip the waiting list. So for say $5000 you'd get to be the first family to get offered a spot. That's how Disneyland works - if you stay at their very expensive hotels you get to skip some of the lines. This is also how airports work - if you buy a business class ticket you can skip the regular line to the security check.
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Old 08-23-2019, 09:11 AM
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Real life businesses do this differently:
No.

Real-life business owners do whatever they want.

How long have you owned and operated your own business?
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Old 08-23-2019, 09:19 AM
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No.

Real-life business owners do whatever they want.

How long have you owned and operated your own business?
Obviously they do! If they didn't, I would have been here asking this question However I'm curious why they do this - both small daycare centers and large corporations like Bright Horizons. Daycare represents one of the few examples of hard to get products in the Western world and is therefore a curiosity.

I don't run a daycare myself but my family runs assisted living facilities so I'm well familiar with what service providers have to deal on a daily basis.
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Old 08-23-2019, 09:24 AM
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Thank you for the response, now we're finally getting to a real answer So you're saying people won't drop off the waitlist but would refuse the spot eventually and leave you with no clients in the end? Or in other words daycare providers don't have a stable supply of customers and prefer a long waitlist to maintain job security?

However your example is flawed as it represents a bad business practice. Real life businesses do this differently:

1. You start with a price of $100/week and a waitlist of two years
2. You keep the same price for existing customers but raise the price for anyone joining next year to $120
3. As you go through the waitlist it shortens and now your waitlist is 1.5 years long
4. Next year you raise your price for new customers by another 20% to $150
5. After going through the waitlist you've now shortened it to 1 year only and stop raising your fees

That's how my local barbershop which suddenly became very popular did this. I still pay the same fee as I did a few years back, but new customers have to pay 50% more. They are now considering increasing the price even more, as they still have more customers than they can handle.

An alternative option is to have a fee to skip the waiting list. So for say $5000 you'd get to be the first family to get offered a spot. That's how Disneyland works - if you stay at their very expensive hotels you get to skip some of the lines. This is also how airports work - if you buy a business class ticket you can skip the regular line to the security check.
You know, it sounds like you have it all figured out, so go for it! Put these ideas into practice and open a daycare! Another quality daycare will surely help shorten a few waiting lists.
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Old 08-23-2019, 09:32 AM
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You know, it sounds like you have it all figured out, so go for it! Put these ideas into practice and open a daycare! Another quality daycare will surely help shorten a few waiting lists.
I'm not trying to convince anyone I know more about their business than they do! Obviously I don't know jack about how to run a daycare. Otherwise I wouldn't be here asking the sages of Daycare.com for their opinion.

All I'm asking is why daycare businesses follow an unusual pricing strategy. So far the answer seems to be "because daycares are extremely risk averse and prefer having very long waiting lists instead of trying to maximize their long term revenue".
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Old 08-23-2019, 09:46 AM
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Have you ever worked overtime and had your check come out to less than if you just worked your normal schedule?
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Old 08-23-2019, 10:13 AM
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Thank you for the response, now we're finally getting to a real answer So you're saying people won't drop off the waitlist but would refuse the spot eventually and leave you with no clients in the end?
Or in other words daycare providers don't have a stable supply of customers and prefer a long waitlist to maintain job security? No, I'm saying with your approach, there is no money. While yes, job security is important to absolutely everyone who HAS a job, maintaining profit along with longevity is the goal.

However your example is flawed as it represents a bad business practice. The example I gave is what would happen with YOUR approach. YOUR approach is what's bad business practice because it leads the provider down a path of more work, less profit.
Real life businesses do this differently:

1. You start with a price of $100/week and a waitlist of two years
2. You keep the same price for existing customers but raise the price for anyone joining next year to $120
3. As you go through the waitlist it shortens and now your waitlist is 1.5 years long
4. Next year you raise your price for new customers by another 20% to $150
5. After going through the waitlist you've now shortened it to 1 year only and stop raising your fees

Most daycares already raise their prices for new clients, so your point is moot.
As long as there is a shortage of providers, nothing changes the wait for a daycare. Price gouging only shifts the wait to other daycares. But hey, it's not illegal in your state (although it is in others).


That's how my local barbershop which suddenly became very popular did this. I still pay the same fee as I did a few years back, but new customers have to pay 50% more. They are now considering increasing the price even more, as they still have more customers than they can handle.

An alternative option is to have a fee to skip the waiting list. So for say $5000 you'd get to be the first family to get offered a spot. That's how Disneyland works - if you stay at their very expensive hotels you get to skip some of the lines. This is also how airports work - if you buy a business class ticket you can skip the regular line to the security check.

^ THAT is actually not a bad idea, although considered unethical in our line of work. However, in my experience, the clients who have the most money, aren't always the best ones. But for $5000, I'd consider it.
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Old 08-23-2019, 10:43 AM
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Price gouging only shifts the wait to other daycares. But hey, it's not illegal in your state (although it is in others).

THAT is actually not a bad idea, although considered unethical in our line of work. However, in my experience, the clients who have the most money, aren't always the best ones. But for $5000, I'd consider it.
Got it. So essentially daycares are trying to avoid being accused of unethical behaviour and thus losing clients in the long term. Otherwise everyone would maximize their prices or charge fees to skip the waitlist. This pretty much answers my original question.
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Old 08-23-2019, 11:11 AM
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Got it. So essentially daycares are trying to avoid being accused of unethical behaviour and thus losing clients in the long term. Otherwise everyone would maximize their prices or charge fees to skip the waitlist. This pretty much answers my original question.
My question is, where are all of these families going who are now priced out of the waitlist?
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Old 08-23-2019, 11:14 AM
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Done.
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Old 08-23-2019, 11:15 AM
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My question is, where are all of these families going who are now priced out of the waitlist?
In Seattle the average daycare price is somewhere around $2000/month which already prices out a large percentage of families. People deal with in various ways, just like my grand grandparents dealed with their children back in the day when daycare was not as common
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Old 08-23-2019, 11:53 AM
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In Seattle the average daycare price is somewhere around $2000/month which already prices out a large percentage of families. People deal with in various ways, just like my grand grandparents dealed with their children back in the day when daycare was not as common
It sounds as though you've just disproved your own theory. From what you've just said, Seattle providers have already raised their rates to the point where a large percentage of families can't afford care and yet, there are still long waiting lists that still exist. Once day care becomes too expensive, you're right...many people will decide to stay home and raise their own kids. Working won't be a viable choice for them. That won't result in shorter waiting lists. They will still exist because most of the providers who exist currently will have priced themselves out of business. Fewer providers doesn't equal shorter wait lists for the parents who still need/choose to work.
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Old 08-23-2019, 12:02 PM
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Wait list are needed due to the child care need/ provider ratio. The are more children than providers. The only thing that could change that is birth control or more providers.
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Old 08-23-2019, 12:05 PM
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Nope. The AVERAGE price of daycare in Seattle is $1200.

http://www.seattleschild.com/Cut-the-cost-of-childcare/
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Old 08-23-2019, 12:09 PM
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It sounds as though you've just disproved your own theory. From what you've just said, Seattle providers have already raised their rates to the point where a large percentage of families can't afford care and yet, there are still long waiting lists that still exist. Once day care becomes too expensive, you're right...many people will decide to stay home and raise their own kids. Working won't be a viable choice for them. That won't result in shorter waiting lists. They will still exist because most of the providers who exist currently will have priced themselves out of business. Fewer providers doesn't equal shorter wait lists for the parents who still need/choose to work.
Not really. This just shows that $2000 is not high enough, which isn't surprising as we have tens of thousands of highly paid Boeing, Microsoft, Amazon, Google employees living in the city. However no one has infinite money so at some price point (say $3000) parents will start dropping out of the waitlist and it will become possible to get a spot on a short notice.
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Old 08-23-2019, 12:14 PM
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Nope. The AVERAGE price of daycare in Seattle is $1200.

http://www.seattleschild.com/Cut-the-cost-of-childcare/
That article is from 2016 and lists $381 per week for center based care, which is $1524 per month. Unfortunately costs have further increased around here, especially if you want something close to downtown.
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Old 08-23-2019, 12:28 PM
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The average Boeing employees makes $125,000 a year. There are 80,000 employees in the Greater Seattle region.

Microsoft? $207,500. 42,000 employees.

Amazon? $159,000. 25,000 employees. (including employees in their fulfillment centers that are in places like Renton and Dupont)

Google? $200,500. They're not even CLOSE to being one of the Seattle metros top employers, with only 98,000 employees worldwide.

The average NET salary in Seattle is $69,000.

Basically what you're saying is that we need to raise our prices so that only the wealthy are entitled to quality childcare.

Nevermind that we have years of experience, and actually know what we're talking about.

If someone offered me $5000 to get off my waitlist I'd laugh in their face. I don't want parents that think they can "buy" me. My policies are mine, and they're set for a reason. Entitled parents in the beginning typically end up being problem parents while using your services. They want it when they want it, no matter how you or the other parents of children in your care are affected.

But you be stubborn and stick to your guns.... your OPINION on this is obviously worth more to you than our experience.
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Old 08-23-2019, 12:32 PM
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In the beginning, I wanted to stay up with this thread just because it interested me but now I'm thouroughlyand going.

"What does any of this have to do with the price of beans in China?" as my grandfather used to say
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Old 08-23-2019, 01:20 PM
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Basically what you're saying is that we need to raise our prices so that only the wealthy are entitled to quality childcare.
I'm sorry I gave you that impression. I'm just asking why daycare providers don't raise their prices more. If part of the answer is "I don't want to price out everyone but the wealthiest parents", I'd take it. I actually mentioned this as my hypothesis back in the very first post.

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Nevermind that we have years of experience, and actually know what we're talking about.
I could not agree more! Nobody knows better than an actual daycare provider.

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Originally Posted by tandow View Post
If someone offered me $5000 to get off my waitlist I'd laugh in their face. I don't want parents that think they can "buy" me. My policies are mine, and they're set for a reason. Entitled parents in the beginning typically end up being problem parents while using your services. They want it when they want it, no matter how you or the other parents of children in your care are affected.
I see. So having a long waitlist is convenient as you can always kick out a parent from your business for obnoxious behavior? As opposed to charging a lot of money and having to deal with adult tantrums.

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But you be stubborn and stick to your guns.... your OPINION on this is obviously worth more to you than our experience.
I'm only sticking to my guns about the claim that increased pricing could not eliminate waitlists I do not have any "guns" about the practicalities of daycare operations.
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Old 08-23-2019, 02:11 PM
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An alternative option is to have a fee to skip the waiting list. So for say $5000 you'd get to be the first family to get offered a spot.
Isn't that kind of how all those parents got in trouble with getting their kids into college?

So basically parents can buy their way to the front of the line? That's really sad.

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Originally Posted by Myst_Seattle View Post
Got it. So essentially daycares are trying to avoid being accused of unethical behaviour and thus losing clients in the long term. Otherwise everyone would maximize their prices or charge fees to skip the waitlist. This pretty much answers my original question.
Daycares (in general) aren't trying to avoid being accused of unethical behavior....they simply aren't unethical. period. The provider that is all business and nothing but business is few and far between. 99% of providers care MORE about their clients than they do about the income.

Haven't you read the venting thread here?

If not, I suggest you do. Almost every single post involves a provider trying to help a child/family and not wanting to term them for fear of failing them. If it was all about the money and only the money kids would be termed every time some one else came along and offered a $1 more a day for the spot.



Lastly you never answered my question about how waitlists actually work..... Waitlists are not first on the list gets the spot like most places. Wait lists that operate that way might benefit from your theory but in reality it's BEST fit gets the open spot. So the Smith family might only spend 3 days on a wait list before getting a spot even though the Jones family has been on the list for 3 years.

No matter how much money the Jones family pays if they aren't a good fit, they aren't going to be first pick.
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Old 08-23-2019, 02:19 PM
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I see. So having a long waitlist is convenient as you can always kick out a parent from your business for obnoxious behavior? As opposed to charging a lot of money and having to deal with adult tantrums.
It isn't about convenience. It's about keeping my own family fed and keeping my finances in check too... Like previously posted....it's about job security. Not all areas in the country are the same so not all daycares have waitlists.

But yes, some of the adult tantrums we've witnessed or endured are not worth any amount of money.

I am more business geared than most providers but even I have my limits and I've termed families that have certain behaviors and attitudes simply because I value myself and my self worth MORE than I value my bank account.

There will be no U-Haul trucks following my funeral procession. I'd rather make a difference in someone's life than earn an extra $ or two. In the child care business it isn't black and white like it might be in other businesses.
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Old 08-23-2019, 02:49 PM
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Isn't that kind of how all those parents got in trouble with getting their kids into college?

So basically parents can buy their way to the front of the line? That's really sad.
It's only illegal if you pay a bribe to secure a spot. If you have an official pricelist for skipping the line its perfectly legal, just like you can skip the line at most airports for a fee. I've read that some places let you pay a "donation" to skip the line to their daycare, but that's rare.

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Lastly you never answered my question about how waitlists actually work..... Waitlists are not first on the list gets the spot like most places. Wait lists that operate that way might benefit from your theory but in reality it's BEST fit gets the open spot. So the Smith family might only spend 3 days on a wait list before getting a spot even though the Jones family has been on the list for 3 years.

No matter how much money the Jones family pays if they aren't a good fit, they aren't going to be first pick.
You could always vary your pricing based on fit. E.g. if the Smiths are for some reason the best clients for your particular daycare you could offer them a better rate to incentivize them to join. For example car rental companies sometimes let you borrow a car for free if you drive it from city A to city B for them, when they need to shuffle cars around.
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Old 08-23-2019, 03:07 PM
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It's only illegal if you pay a bribe to secure a spot. If you have an official pricelist for skipping the line its perfectly legal, just like you can skip the line at most airports for a fee. I've read that some places let you pay a "donation" to skip the line to their daycare, but that's rare.
It's illegal for daycare providers to even discuss rates with each other so I'd be surprised if the above is legal.

Call it a donation or a bribe it is what it is and it's unethical.



Quote:
Originally Posted by Myst_Seattle View Post
You could always vary your pricing based on fit. E.g. if the Smiths are for some reason the best clients for your particular daycare you could offer them a better rate to incentivize them to join. For example car rental companies sometimes let you borrow a car for free if you drive it from city A to city B for them, when they need to shuffle cars around.
If the Smith's are already on my waitlist to enroll I don't need to incentivize them to enroll. I don't understand what you mean by that.
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Old 08-23-2019, 03:20 PM
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It's illegal for daycare providers to even discuss rates with each other so I'd be surprised if the above is legal.

Call it a donation or a bribe it is what it is and it's unethical.
It's only unethical if its a backroom kind-of a deal. If you have an official pricelist on your website with everything clearly explained its not unethical at all, in my opinion. Otherwise we should ban business class on airlines But I do agree parents might be furious over this kind of pricing strategy.

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If the Smith's are already on my waitlist to enroll I don't need to incentivize them to enroll. I don't understand what you mean by that.
To rephrase my original explanation: charging some people more to skip the waitlist doesn't mean you can't offer others an immediate vacancy for free. To give another example - airlines often give nice perks to military personnel in active service, even if everyone else has to pay for the privilege.
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Old 08-23-2019, 03:21 PM
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I have to say, that comment really rubbed me the wrong way. That statement couldn't be further from the truth. Maybe where you live, that's what you're seeing. In my area, we take pride in our field. Many of us have had years of early childhood education and training. I don't know too many fields that require the ongoing training we do here.

In regards to short term: The providers I know have 10 years or more under their belt. Myself included.
Here it is a completely different story and I said MOST not ALL providers. We all know great educated providers and we all know dolts.
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Old 08-23-2019, 03:28 PM
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Here it is a completely different story and I said MOST not ALL providers. We all know great educated providers and we all know dolts.
I understood what you meant because we discuss it frequently. The vast majority of providers wash out within two years. We also discuss the sheer number of providers who think they are the special exception to laws governing our field. Yes, those groups equate to the majority of providers at any given time.
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Old 08-23-2019, 03:31 PM
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I understood what you meant because we discuss it frequently. The vast majority of providers wash out within two years. We also discuss the sheer number of providers who think they are the special exception to laws governing our field. Yes, those groups equate to the majority of providers at any given time.
Yes! I also did not in any way say my assumption was correct. Just throwing out an idea as to why providers do not charge more and that was my best guess.

We are THE most essential service. There is no other service more essential than ours. Yet we are some of the lowest paid workers. Do the math it just does not add up and I think it is good to have a conversation about it

FWIW I think Myst Seattle has some good points to ponder if only we could stop taking things so personally and listen.
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Old 08-23-2019, 03:38 PM
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I am curious so I PM'ed Tom Copeland and asked for his legal advice/interpretation as to the legality of this "idea".

Hopefully he will put his two cents in.
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Old 08-23-2019, 03:53 PM
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We are THE most essential service. There is no other service more essential than ours. Yet we are some of the lowest paid workers. Do the math it just does not add up and I think it is good to have a conversation about it
That is absolutely true! Which is another reason why I find it strange that there's such a large shortage of daycare services, but for some reason daycare worker salaries are on the lower side of the spectrum.
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Old 08-23-2019, 07:09 PM
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What was your job? I know people in the "legal field" who are secretaries and have only graduated high school. Law firms even need custodians.
Darlin' I was a Paralegal & a Private Process server.. I also ran the courts, & met numerous Judges in Person... Not a secretary & I have a AAS degree in Criminal Law, so go jump in a lake. TN won't hire a TEACHER SUB unless they have a degree ALSO. WHY DON'T YOU COME OUT OF HIDING AND SPEAK WITH AN ACTUAL NAME LIKE THE REST OF US
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Old 08-26-2019, 09:34 AM
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The need would still be there, but you won't have to wait for it. Just like you can always buy a plane ticket for Christmas, even if it costs a lot more than on other days. Likewise it is easy to buy a house in Seattle, although you need a lot of money to afford one.



Having a long waiting list means parents who both want to work full-time are unable to do so, even if they have the funds to pay for childcare. I personally know people who are struggling with this issue. Increasing the price would increase the profitability of daycares and make access to their services easier to plan for.



It is easy to demonstrate why this is true with an exaggerated example. Let's say you increase your daycare price to $100,000 per week. At those rates only someone like Bill Gates would be able to afford it and the waitlist would be gone. Obviously you can't charge $100k per week, but there is always a price point at which the waiting list would become minimal without hurting your profitability. In economic theory this is referred to as the "supply and demand" curve.



I completely agree that overregulation is the root cause of the daycare deficit! However that doesn't explain the business practices of daycares in the existing legal environment
So the waitlist goes away because they canít AFFORD your daycare... so you make max then people quit or go to school and now your prices are too high
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Old 08-26-2019, 11:27 AM
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I think I'm totally missing this argument. The only reason I had a wait list was because I had more people interested in spots than I had spots available. I don't see how pricing people out of my wait list would have helped me at all. Then when someone leaves, I have no one to choose from. Everyone already complains about paying for daycare and expects you to watch their kids for next to nothing. I would have no clients if I had charged higher than what I already charged...
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Old 08-26-2019, 12:20 PM
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I think I'm totally missing this argument. The only reason I had a wait list was because I had more people interested in spots than I had spots available. I don't see how pricing people out of my wait list would have helped me at all. Then when someone leaves, I have no one to choose from. Everyone already complains about paying for daycare and expects you to watch their kids for next to nothing. I would have no clients if I had charged higher than what I already charged...
Others have already explained why my idea might not necessarily work out in practice for everyone, see the comments above. But here's how it works in theory:

1. Let's say your daycare is based in a major city, charges $100/week and has a waitlist of 2 years
2. You increase the price to $120/week and wait for a year. Now your waitlist has decreased to 1.5 years
3. You further increase the price to $150/week and wait for another year. Now your waitlist is at 6 months.

For you as a business having a 6 month waitlist should be as good as having a 2 year waitlist, as you still have enough potential clients at your door whenever you have a vacancy. And at the same time your profit margins go up as you now charge more than you did before, for the exact same amount of work. As a bonus parents can now plan for daycare much more easily, as wait times will become short and predictable.
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Old 08-26-2019, 01:21 PM
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Others have already explained why my idea might not necessarily work out in practice for everyone, see the comments above. But here's how it works in theory:

1. Let's say your daycare is based in a major city, charges $100/week and has a waitlist of 2 years
2. You increase the price to $120/week and wait for a year. Now your waitlist has decreased to 1.5 years
3. You further increase the price to $150/week and wait for another year. Now your waitlist is at 6 months.

For you as a business having a 6 month waitlist should be as good as having a 2 year waitlist, as you still have enough potential clients at your door whenever you have a vacancy. And at the same time your profit margins go up as you now charge more than you did before, for the exact same amount of work. As a bonus parents can now plan for daycare much more easily, as wait times will become short and predictable.
What you didn't take into consideration is... of the people on the waitlist @ least 50% all find other care before your spot opens, as was said, you also have priced out potentials... then there is the 3 people quit, no notice, but nobody on the wait list needs you this month because they weren't expecting the spot to open sooner.

Too many factors for upping fees just to shorten the waitlist. Unless you have lived real world waitlist for home daycares don't think it will work; theory vs Real life - 2 totally different things... even the area can contribute as a factor. Blue collar neighborhoods can't afford even half of what most city folks pay
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Old 08-26-2019, 03:58 PM
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Originally Posted by LysesKids View Post
What you didn't take into consideration is... of the people on the waitlist @ least 50% all find other care before your spot opens, as was said, you also have priced out potentials... then there is the 3 people quit, no notice, but nobody on the wait list needs you this month because they weren't expecting the spot to open sooner.

Too many factors for upping fees just to shorten the waitlist. Unless you have lived real world waitlist for home daycares don't think it will work; theory vs Real life - 2 totally different things... even the area can contribute as a factor. Blue collar neighborhoods can't afford even half of what most city folks pay
As I've mentioned in a different post, an alternative strategy could involve allowing people to pay a fee (say, $5000) to skip the waitlist and be the first to get a spot whenever one is free. There are certainly parents desperate to find daycare amongst my friends who would gladly pay a reasonable amount to skip the lines.
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Old 08-26-2019, 04:11 PM
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How does any of what you suggested benefit the provider?
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Old 08-26-2019, 04:29 PM
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How does any of what you suggested benefit the provider?
Daycare providers could certainly use more money, won't they?

You've mentioned in an older post that you've PM'ed Tom Copeland. Did you get a response by any chance?
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Old 08-26-2019, 04:58 PM
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sahm1225 sahm1225 is online now
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As I've mentioned in a different post, an alternative strategy could involve allowing people to pay a fee (say, $5000) to skip the waitlist and be the first to get a spot whenever one is free. There are certainly parents desperate to find daycare amongst my friends who would gladly pay a reasonable amount to skip the lines.
But why would a provider want a family who is showing them up front that they feel the rules donít apply to them? I think you are misunderstanding that a waitlist as a guarantee that the family will get a spot. They still have to interview for it and make sure theyíre a right fit.
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