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How to Start an Adult Daycare [Business Plan]

An adult daycare center is a non-residential daycare facility that provides support in the areas of health, nutrition, social, and daily living needs of adults in a professionally staffed, group setting. Adult daycare is designed to provide adults with transitional care and short-term rehabilitation especially when they are discharged from the hospital or when their family members are not around to take care of them.

Available data shows that currently, there are over 7,500 adult day care programs operating in the United States, up from 4,601 in 2010, and they provide care for more than 282,000 elderly Americans. Of this 4,800 registered daycare, 78 percent operate as not-for-profit while 22 percent of centers operate as for-profit corporations.

Steps on How to Start an Adult Day Care Business

1. conduct market research.

If you intend to start an adult daycare business, then you must make sure you conduct thorough market research. It is important to conduct research because it will help you carry out a careful and detailed study of the problem you intend to solve with your adult daycare, using scientific methods. With successful market research, you will be able to explore the unknown and unlock new possibilities in the industry in which you want to start your business.

a. Who is the Target Market for Adult Day Care?

The target market for an adult day care are adults who are suffering from;

  • Cerebral palsy
  • Down syndrome
  • Emotional disturbance
  • Reading and learning disabilities
  • Intellectual disabilities
  • Demographics should be included
  • Pervasive developmental disorder
  • Speech and language impairments
  • Spina bifida
  • Traumatic brain injury
  • Visual impairments

b. Is Adult Day Care a Profitable Business?

Yes, the adult daycare business is profitable. Statistics show that the market size, measured by revenue of the adult daycares industry sits at $5 billion. Demand for adult day care centers is increasing with the need for assistance in old age.

c. Are There Existing Niches in the Industry?

Yes, there are existing niches when it comes to adult day care services and they are;

  • Social services adult day care model
  • Medical services adult day care model
  • Social and medical services adult day care model

d. Who are the Major Competitors?

  • Senior Care Inc.
  • Easterseals

e. Are There County or State Regulations or Zoning Laws for Adult Day Care Business?

Yes, and zoning laws require adult daycare operators to follow specific rules and regulations. These laws are designed to address the unique circumstances of a business operating in a residential area. Many laws seek to minimize the negative impact on the community, which can be affected by increased vehicle traffic and neighborhood noise.

Please note that in many communities, zoning laws require adult day care providers to apply for a permit from the city. This application process allows the city’s zoning department to determine whether the home day care meets the zoning rules for the community. Permits also ensure that all adult day cares are properly licensed with the county or state agencies.

f. Is There a Franchise for Adult Day Care Business?

Yes, there are franchise opportunities for adult day care. Here are some of them;

  • Right at Home (Total startup costs – $75,000 to $100,000)
  • SarahCare Adult Day Care Center Services (Investment $212,427 – $513,427)
  • Elder-Well® Franchisee
  • Greenacres Adult Day Care Franchise
  • Interim HealthCare (Initial Investment – $125,500 to $198,500)
  • Home Care Assistance ($77,775 to $245,250)
  • HomeWell Senior Care (Investment $75,000 – $120,000)
  • BrightStar ($95,000 to $163,000)

g. What Do You Need to Start an Adult Day Care Business?

  • A Feasibility Report
  • Business and Marketing Plans
  • Business Licenses and Permits
  • A Well-Equipped Day-Care Facility
  • EIN (Employer Identification Number)/Federal Tax ID Number.
  • A Corporate Bank Account
  • Supplies (Detergents, Toiletries, Disinfectant, Hand Gloves and more)
  • Startup and Working Capital

Memorable Business Name ideas for Adult Day Care

  • Arit Tim® Adult Day Care, LLC
  • Martins® Adult Day Care, LLC
  • We Care® Adult Day Care, LLC
  • Princess Diana™ Adult Day Care, LLC
  • Esther Lane® Adult Day Care.
  • Baroness Elizabeth® Adult Day Care, LLC
  • Lady Annie® Adult Day Care, LLC
  • Peter Nelson® Adult Day Care
  • Comfort Care® Adult Day Care
  • Ronald Magdalene® Adult Day Care, LLC
  • Maria De La Rosa® Adult Day Care, LLC
  • Anne George™ Adult Day Care
  • Bridget Decoster™ Adult Day Care
  • Inner City® Adult Day Care, LLC
  • Well Palm® Adult Day Care
  • Jacinta Borrow® Adult Day Care
  • Green Bay© Adult Day Care
  • Georgina Paulson™ Adult Day Care, LLC
  • Jill Noel™ Adult Day Care.
  • Madonna Whyte® Adult Day Care

Register Your Business

A. what type of business structure is best for adult day care.

Even though there are several options when it comes to the business structure of an adult day care, most players in this line of business consider an LLC. It is common to consider an LLC because providers want to protect themselves from lawsuits.

Please note that an LLC will need an EIN if it has any employees or if it will be required to file any of the excise tax forms listed below. Most new single-member LLCs classified as disregarded entities will need to obtain an EIN.

b. Steps to Form an LLC

  • Choose a Name for Your LLC.
  • File Articles of Organization.
  • Choose a registered agent.
  • Decide on member vs. manager management.
  • Create an LLC operating agreement.
  • Comply with other tax and regulatory requirements.
  • File annual reports.

c. What Type of License is Needed to Open an Adult Day Care?

  • General Business License
  • Group Family Child Care License
  • Health and Safety Permit
  • Zonal Permits
  • Director’s License
  • State Facility Inspections
  • Operational State Facility Inspections (Building Permits)

d. What Type of Certification is Needed to Open an Adult Day Care?

Social Adult Day Care Certification.

e. What Documents are Needed to Open an Adult Day Care?

These are some of the basic legal documents you need to legally run an adult daycare in the United States of America;

  • Business and Liability Insurance
  • Federal Tax Payer’s ID
  • State Permit and Building Approval
  • Certificate of Incorporation
  • Business License
  • Business Plan
  • Employment Agreement (offer letters)
  • Operating Agreement for LLC
  • Insurance Policy
  • Online Terms of Use (if you have a website)
  • Online Privacy Policy Document (for online payment portal)
  • Company Bylaws
  • Memorandum of Understanding (MoU)

f. Do You Need a Trademark, Copyright, or Patent?

If you are considering starting an adult day care, usually you may not need to file for intellectual property protection or trademark. This is because the nature of the business makes it possible for you to successfully run the business without having any cause to challenge anybody in court for illegally making use of your company’s intellectual properties.

Cost Analysis and Budgeting

A. how much does it cost to start an adult day care.

When it comes to starting an adult daycare business, the startup costs vary. It could range from $80,000 (if you are opting for a franchise) to over $500,000. This is because the startup inventory is on the high side.

b. What are the Costs Involved in Starting an Adult Day Care

  • Business Registration Fees – $750.
  • Legal expenses for obtaining licenses and permits – $7,300.
  • Marketing, Branding and Promotions – $5,000.
  • Business Consultant Fee – $2,500.
  • Insurance – $5,400.
  • Rent/Lease – $250,000.
  • Other start-up expenses including, commercial satellite TV subscriptions, stationery ($500), and phone and utility deposits ($2,800).
  • Operational Cost (salaries of employees, payments of bills et al) – $60,000
  • start-up inventory – $15,000
  • Store Equipment (cash register, security, ventilation, signage) – $4,750
  • Furnishing and Equipping – $80,000
  • Website: $600
  • Miscellaneous: $5,000

c. What Factors Determine the Cost of Opening an Adult Day Care?

  • The type of adult day care business
  • The choice of location
  • The required licenses and permits
  • The type of facility
  • Additional services offerings
  • The number of residents they want to admit
  • The cost of hiring and paying a business consultant and attorney
  • The cost for branding, promotion, and marketing the adult daycare business
  • The cost for furnishing and equipping the adult daycare
  • The cost for insurance policy covers
  • The cost for registering the business
  • Source of your supplies and ongoing expenses
  • Cost of recruiting and training your staff
  • The cost for the purchase and customizing of uniforms

d. Do You Need to Build a Facility? If YES, How Much Will It Cost?

It is not compulsory to build a new facility for your adult day care, but if you have the finance, it will pay you to build your facility. The truth is that building a facility for your adult day care will help you come up with a facility that will perfectly fit into your overall business goals and vision.

e. What are the Ongoing Expenses of an Adult Day Care?

  • Rent and lease
  • Cost of stocking up supplies such as medications, toiletries, disinfectants, hand gloves, beddings et al
  • Utility bills (phone bills, signage and software renewal fees et al)
  • Salaries of employees

f. What is the Average Salary of your Staff?

  • Head of Adult Day Care (President) – $45,000 Per Annum
  • Day Care Administrator – $36,034 Per Annum
  • Medication Management Counselors – $35,600 Per Annum
  • Nurse’s Aides – $30,660 Per Annum
  • Home Health Caregivers/Home Caregivers/County Aging Workers – $32,878 Per Annum
  • Account Officer – $35,000 Per Annum
  • Front Desk Officer – $28,000 Per Annum
  • Cleaners – $22,000 Per Annum
  • Security Guard – $22,000 Per Annum

g. How Do You Get Funding to Start an Adult Day Care

  • Raise money from personal savings and sale of personal stocks and properties
  • Raise money from investors and business partners
  • Sell shares to interested investors
  • Apply for a loan from your bank/banks
  • Pitch your business idea and apply for business grants and seed funding from, government, donor organizations, and angel investors
  • Source for soft loans from your family members and your friends.

Write a Business Plan

A. executive summary.

We Care® Adult Day Care, LLC is a registered for-profit adult day care that will be based in Tallahassee – Florida, USA. Our adult daycare center is designed to provide care and companionship for older adults who need assistance or supervision during the day. Our programs are designed to offer relief to family members and caregivers, allowing them to go to work, handle personal business, or just relax while knowing their relatives are well cared for and safe.

b. Products and Service

  • Care-planning services
  • Daily living assistance (day only)
  • Nursing and health services
  • Therapeutic services
  • Meal services
  • Transportation services
  • Social activities.

c. Mission Statement

Our mission is to build a highly successful, adult daycare center that provides community-based day health services for the elderly and disabled. We are going to provide services that include living assistance, nursing, therapy, meals, and social activities. We will also provide quality supervised care at affordable costs.

Vision Statement

Our vision is to create an international model for the adult daycare industry.

d. Goals and Objectives

The goals and objectives of an adult day care center are to provide quality care and enriching services where adults who need care can be taken care of during the day.

e. Organizational Structure

  • Head of Adult Day Care (President)
  • Adult Day Care Administrator
  • Medication Management Counselors
  • Nurse’s Aides
  • Home Health Caregivers/Home Caregivers/County Aging Workers Fundraiser
  • Account Officer
  • Front Desk Officer
  • Security Guards

Marketing Plan

A. swot analysis.

The strength of the adult daycare facility lies in the fact that they have a team of qualified professionals manning various job positions in the organization. Also, the location, the business model they will be operating on, well-equipped facility and their excellent customer service culture will definitely count as a strong strength for the facility.

Our Adult Daycare is a new business that is owned by a family, and they may not have the financial muscle to sustain the kind of publicity that will give the business robust visibility.

Opportunities:

The opportunities that are available to adult day care facilities are unlimited because we have loads of adults over 60 who would one day need the services of an adult daycare in the United States.

Just like any other business, one of the major threats you are likely going to face is an economic downturn and unfavorable government policies. It is a fact that an economic downturn affects purchasing/spending power. Another threat that may likely confront an adult daycare business is the arrival of a new and bigger adult daycare in the same location where your facility is located.

b. How Do Adult Day Care Centers Make Money?

Adult daycare centers makes money by charging their clients (for-profits) or from support for donor agencies and charities (not-for-profit).

Please note that funding for adult day care comes from a variety of public and private sources. At the Federal and State levels, funds are available from Medicaid, Social Services Block Grants, and Older Americans Act monies.

c. Payment Options

  • Payment via bank transfer
  • Payment with cash
  • Payment via credit cards
  • Payment via online bank transfer
  • Payment via check
  • Payment via mobile money transfer

d. Sales & Advertising Strategies

  • Place adverts on both print (newspapers and health-related magazines) and electronic media platforms
  • Sponsor relevant community-based events/programs for the elderly
  • Leverage on the internet and social media platforms like; Instagram, Facebook, Twitter, YouTube, Google + et al to promote your facility
  • Install your Bill Boards in strategic locations all around your city or state
  • Distribute your fliers and handbills in target areas
  • Contact households, businesses, and every adult in the neighborhood where your adult daycare will be located informing them about your business
  • List your adult day care in local directories / yellow pages
  • Advertise your adult daycare on your official website and employ strategies that will help you pull traffic to the site.
  • Position your Flexi Banners at strategic positions in the location where your adult daycare is located.
  • Ensure that all your staff members wear your branded shirts and all your vehicles and trucks/vans are well branded with your company logo.

Financial Projection

A. how much should you charge for your service.

Our average daily cost of adult day services will be $70.

b. How Much Profit Do Adult Day Care Owners Make a Year?

It depends, but available reports show that owners of adult daycare centers profit an average of $37,000 per year. While some owners of special daycare centers report earning over $60,000 profit per year, the other side of the report shows that an adult day care can make well over $50,000.

c. What Factors Determine the Amount of Profit to Be Made?

  • The capacity of the adult daycare
  • The location the adult daycare is covering
  • The management style of the adult daycare
  • The business approach of the adult daycare
  • The advertising and marketing strategies adopted by the adult daycare
  • The number of years the adult daycare is in business

d. What is the Profit Margin of an Adult Day Care?

The profit margin of an adult day care is not fixed; to a large extent, it will depend on some factors that are unique to your location if you are operating as a for-profit organization. Please note that most adult daycares operate as nonprofits hence they are not expected to make profits.

e. What is the Sales Forecast?

Below is the sales forecast of an adult daycare. It is based on the location of the business and other factors as it relates to such startups in the United States;

First Fiscal Year: $240,000

Second Fiscal Year:  $350,000

Third Fiscal Year: $480,000

Set Up your Office

A. how do you choose a perfect location for adult day care.

  • The demography of the location especially as it relates to the aging population
  • The demand for adult day care services in the location
  • The purchasing power of residents of the location
  • Accessibility of the location
  • The number of adult daycares and other facilities like senior care, nursing homes and sober living et al in the location
  • The local laws and regulations in the community/state
  • Traffic, parking and security et al

b. What State and City are Best to Open an Adult Day Care?

  • Las Vegas, Nevada
  • Los Angeles, California
  • Chicago, Illinois
  • Boston, Massachusetts
  • Silver Spring, Maryland
  • Rowland Heights, California
  • Portland, Oregon
  • New York City, New York
  • Atlanta, Georgia
  • Dallas, Texas

c. What Equipment is Needed to Operate an Adult Day Care?

When starting an adult daycare, you will not need any technical gadgets except office and nursing equipment, first aid kits, smoke detectors, carbon monoxide detectors, fire extinguishers, an emergency preparedness kit, an emergency plan, among other things.

But in setting up a small office, you will need a computer, printer, software apps, telephones, pager, photocopier, scanner, and fax machine. These machines, equipment, and tools can be purchased as fairly used especially if you have limited finance to meet your budget.

Hire Employees

As regards the number of employees you are expected to kick start the business with, you would need to consider your finance before making the decision. When it comes to starting a standard adult daycare business on a large scale, you would need the services of the following professionals; the head of daycare (you can occupy this position), adult daycare administrator, medication management counselors, nursing aides, home health caregivers, front desk officer, security guards, and cleaners.

Launch the Business Proper

You can decide to throw an opening party to officially launch your business. You can choose to do a soft opening if you are operating on a low budget or you can go for a grand opening party. The bottom line is that with a proper launching of the adult daycare, you will be able to officially inform people in your city that your adult daycare is open for business.

a. What Makes an Adult Daycare Business Successful?

  • Ability to attract grants and funding from the government of your city or state or even the federal government
  • Disciplined and dedicated workforce
  • The heart to serve
  • Good facility and ambiance
  • A good relationship with stakeholders
  • Good care techniques and programs.

b. What Happens During a Typical Day at an Adult Daycare Business?

  • The adult daycare is open for the day
  • The facility is cleaned and prepared to welcome students
  • Students are welcomed
  • Students are provided with special care, nursing and other assistance in daily living and feeding
  • The school is closed for the day and family members come in to pick their wards

c. What Skills and Experience Do You Need to Build an Adult Daycare Business?

Here are some of the skills and experiences you would need to build an adult daycare business;

  • Good managerial and human development skills
  • Visionary Leadership
  • Strategy & Development
  • Team-building & Interpersonal Skills.
  • Excellent communication and negotiation skills.
  • Organizational skills.
  • Problem-solving ability.
  • Experience working as a social worker
  • Experience in the adult daycare industry
  • Experience in adult daycare administration.

More on Adult Daycare

How to Start a Profitable Adult Day Care Business [11 Steps]

Nick

By Nick Cotter Updated Feb 05, 2024

image of a adult day care business

Business Steps:

1. perform market analysis., 2. draft a adult day care business plan., 3. develop a adult day care brand., 4. formalize your business registration., 5. acquire necessary licenses and permits for adult day care., 6. open a business bank account and secure funding as needed., 7. set pricing for adult day care services., 8. acquire adult day care equipment and supplies., 9. obtain business insurance for adult day care, if required., 10. begin marketing your adult day care services., 11. expand your adult day care business..

Performing a market analysis is an important first step when launching an adult day care business. This process involves a detailed examination of the market, to understand trends, competition, and potential customers, thus guiding the development of a successful business strategy.

  • Identify your target customers: Understand who your potential customers are by researching the demographics and psychographics of the senior population in your intended area. Look at age, income, health status, etc. Understand their needs, preferences, and daily routines.
  • Analyze your competition: Research about other adult day care centers in your target area. Look at what services they offer, their pricing, their strengths and weaknesses. This can help you differentiate your business and find potential gaps in the market.
  • Understand the Industry Trends: Stay updated with current trends and changes in the adult day care industry. This could include changes in regulations, new technologies or services, etc. This will help you stay competitive and innovate.
  • Evaluate the Market Size and Growth: Determine the size of your potential market and its growth rate. This can give you an idea of the potential demand for your services and help you plan your business accordingly.

Note that market analysis is an ongoing process and should be updated regularly as market conditions change.

image of a adult day care business

Are adult day care businesses profitable?

Yes, adult day care businesses can be profitable. It is important to carefully manage the business, including marketing to potential clients, providing a high quality of care, and having an efficient operating system in place. Additionally, many facilities accept subsidies and other forms of reimbursement from insurance companies or government programs to increase profits.

Embarking on the journey to start an adult day care business requires meticulous planning and a comprehensive understanding of your goals, target market, and operational strategies. A well-crafted business plan is an essential roadmap that will help you navigate through the complexities of establishing and managing your adult day care center effectively. Here are the crucial components to include in your business plan draft:

  • Executive Summary: Summarize your adult day care's mission, services, and basic information about the management team and business structure.
  • Market Analysis: Detail your research on local demographics, demand for adult day care services, and an examination of competitors in the area.
  • Services Offered: Outline the types of services and activities your center will provide, focusing on the unique aspects that set you apart.
  • Marketing Plan: Describe how you will attract and retain clients, including pricing strategies, promotional efforts, and partnerships.
  • Operational Plan: Explain the day-to-day operations, staffing requirements, facility layout, and any transportation services offered.
  • Financial Projections: Present realistic financial forecasts, including startup costs, operating budget, revenue projections, and a break-even analysis.
  • Risk Management: Identify potential risks and describe the measures you will take to mitigate them.
  • Funding Requests: If you're seeking financing, specify the amount needed, intended uses, and proposed repayment plans.

How does a adult day care business make money?

An adult day care business typically makes money by charging a daily fee for services such as assistance with meals, activities like crafts and games, assistance with medications, and companionship. To increase profit potential, day care owners may also offer additional services such as transportation or outings to local attractions. For example, an 11 Steps To Starting a Successful Spice Business might target seniors who need assistance cooking meals with certain ingredients or spices, who are looking for a convenient and safe way to do their grocery shopping.Retiring Baby Boomers who want to stay active in the community and maintain their independence are also a potential target market for this type of business.

Beginning with a comprehensive business plan is crucial when establishing an adult day care center, as it serves as a roadmap for your business's future. It outlines your business goals, strategies for achieving them, and the financial projections to support your vision. A well-crafted business plan will also be indispensable when seeking funding or partnerships. Here's how to approach drafting your business plan:

  • Executive Summary: Start with an executive summary that encapsulates the essence of your adult day care business. Briefly describe your mission, the services you will offer, and the market need you're addressing. Highlight your unique selling points and your vision for the business's growth.
  • Company Description: Provide a detailed description of your business, including the legal structure, location, and the background that led to its inception. Explain how your adult day care will improve the quality of life for your clients and address a specific need in the community.
  • Market Analysis: Present a thorough analysis of the adult day care industry, including trends, demographics, and competitor evaluations. Identify your target market and explain how your services meet their needs better than existing options.
  • Organization and Management: Outline your business's organizational structure, detailing the roles and responsibilities of your management team. Include biographies that highlight the experience and expertise that each team member brings to the business.
  • Services Offered: Describe the range of services you plan to offer. Explain how these services will be provided and how they will meet the diverse needs of your clients, such as social activities, health services, and transportation.
  • Marketing Plan: Develop a marketing strategy that details how you will attract and retain clients. Include your branding, promotional strategies, and a sales plan that outlines how you will build relationships in the community.
  • Funding Request: If you are seeking financing, clearly state the amount needed and how it will be used. Include a detailed explanation of how you plan to repay any loans or provide returns on investments.
  • Financial Projections: Offer clear financial projections for the next three to five years. Include forecasted income statements, cash flow statements, and balance sheets. Provide a break-even analysis to show when you expect the business to become profitable.
  • Appendix: Attach any additional documentation that supports your business plan or might be of interest to stakeholders, such as resumes, permits, lease agreements, and legal documentation.

How to come up with a name for your adult day care business?

Coming up with a name for an adult day care business is an important step in launching a successful venture. First and foremost, you should pick a name that is catchy, memorable, and easy to spell. Additionally, it should reflect the values and goals of your business, such as promoting trust, companionship, and security. Brainstorm potential words that could be combined with the words “adult day care” to create a unique and creative name. Consider seeking feedback from family members, friends, and colleagues on which names stand out most. With some research and creative thinking, you can come up with the perfect name for your adult day care business!

image of ZenBusiness logo

Formalizing an adult day care business is crucial due to the sensitive nature of client care and the regulatory environment. Proper registration and compliance ensure the safety and well-being of your clients. Follow these steps:

  • Choose a Legal Structure: Consider an LLC or corporation for liability protection.
  • Obtain Licenses and Permits: Check state and local requirements for operating an adult day care, including health and safety certifications.
  • Register Your Business: File the necessary paperwork with your state to officially establish your business entity.

Resources to help get you started:

Explore crucial resources designed for adult day care entrepreneurs featuring insights on market trends, operational best practices, and strategic guidance for business expansion:

  • Genworth Financial's Cost of Care Survey : Provides detailed regional cost data for adult day care services, helping entrepreneurs assess competitive pricing strategies. Link .
  • National Adult Day Services Association (NADSA) : Offers industry reports, regulatory updates, and networking opportunities for adult day care providers. Link .
  • Entrepreneur Magazine's Health Care Center : Features articles and advice on running a successful health care business, including adult day care. Link .
  • Adult Day Care Group's Startup Guide : A comprehensive manual for new adult day care business owners on operational setup, licensing, and marketing. Link Not Provided.
  • Small Business Administration (SBA) : Provides access to business planning, financing, and training resources tailored to the health services sector. Link .

Starting an adult day care business requires careful attention to the legal requirements which vary by location. Acquiring the necessary licenses and permits is crucial to operate legally and provide a safe environment for your clients. Below are the general steps you should follow:

  • Research local regulations: Contact your state's Department of Health and Human Services to understand specific licensing requirements for adult day care centers in your area.
  • Complete training and certification: Some states require operators to complete specific training programs or certifications related to adult day care management and first aid.
  • Apply for a business license: Obtain a general business license from your city or county business licensing office.
  • Obtain specialized permits: Depending on the services you plan to offer, you might need additional permits related to food service, medication distribution, or transportation.
  • Pass health and safety inspections: Your facility will likely need to pass health and safety inspections to ensure it meets all the necessary codes and regulations.
  • Get insurance: Secure liability and property insurance to protect your business and ensure compliance with local regulations.

What licenses and permits are needed to run a adult day care business?

Depending on the state and city, the types of licenses and permits needed to run an adult day care business may vary. Generally, the requirements involve obtaining both a business license and a day care license from the city or county in which the business is located. In addition, a state license from the Department of Social Services is often required. Depending on where the facility is located, additional licensing or permits may also be necessary.

Opening a business bank account and securing funding are crucial steps in establishing the financial foundation for your adult day care business. These actions not only help to separate personal finances from business transactions but also ensure you have the necessary capital to cover startup costs and operational expenses. Here’s a guide to help you through this process:

  • Research banks and credit unions that offer business banking services. Consider their fees, services, and convenience before choosing the right institution for your adult day care business.
  • Prepare the required documents—such as your business plan, EIN, incorporation papers, and personal identification—to open a business bank account.
  • Understand the types of funding available, including loans, grants, and investor capital. Assess which type aligns best with your business needs and financial situation.
  • Contact local government agencies or non-profit organizations that may offer funding opportunities specifically for health care or elder care services.
  • Build a presentation or pitch if you plan to seek out investors. Be prepared to clearly articulate your business model, market analysis, and financial projections.
  • Consider crowdfunding platforms if your business model appeals to community support and if you have a compelling story to share about your adult day care initiative.

Starting an adult day care business requires careful financial planning. You need to set up a separate business bank account to manage your business finances effectively and secure funding for your operations.

  • Opening a Business Bank Account: It's essential to separate your personal finances from your business expenses. Start by choosing a bank that offers services tailored to business needs such as online banking, payroll services, and merchant services. Make sure to check the fees related to the account before you make a decision. You will need your business name, EIN (Employer Identification Number), and legal documents to open the account.
  • Secure Funding: Determine how much money you will need to start and operate your adult day care center. You may need to take out a loan, apply for grants, or find investors. Research the different types of loans available and the requirements for each. It's also a good idea to create a solid business plan to present to potential investors or lenders.

Remember, financial management is key to the success of your business. Make sure to keep accurate records of all transactions and regularly review your business's financial performance.

What does it cost to start a adult day care business?

Initiating a adult day care business can involve substantial financial commitment, the scale of which is significantly influenced by factors such as geographical location, market dynamics, and operational expenses, among others. Nonetheless, our extensive research and hands-on experience have revealed an estimated starting cost of approximately $$32,000/month for launching such an business. Please note, not all of these costs may be necessary to start up your adult day care business.

Starting an adult day care requires careful selection of equipment and supplies to ensure a safe, comfortable, and engaging environment for your clients. It's important to invest in high-quality, durable items that meet the specific needs of the elderly or adults with disabilities. Below is a guide to help you acquire the necessary equipment and supplies for your adult day care business:

  • Furniture: Purchase comfortable seating options like armchairs and sofas, adjustable tables, and sturdy dining furniture. Ensure all furniture is easily accessible and supportive.
  • Safety Equipment: Install grab bars, railings, non-slip flooring, and emergency call systems. Also, provide wheelchairs, walkers, and canes as needed.
  • Medical Supplies: Have basic first aid kits, blood pressure monitors, diabetic testing equipment, and medication storage with secure access.
  • Recreational Materials: Offer books, magazines, games, puzzles, and art supplies to promote cognitive stimulation and social interaction.
  • Exercise Equipment: Include low-impact exercise gear like resistance bands, light weights, and balance balls to encourage physical activity.
  • Technology: Set up computers or tablets with internet access, hearing aids, and large-screen televisions for entertainment and education.
  • Sanitation Supplies: Stock up on cleaning agents, hand sanitizers, disposable gloves, and personal hygiene products to maintain cleanliness and prevent infection.
  • Kitchenware: Ensure you have adequate kitchen equipment and utensils for meal preparation and service, including dietary-specific items if necessary.

List of software, tools and supplies needed to start a adult day care business:

  • Business Licensing - $50 - $3,000 (varies by state)
  • Insurance Policy - $300 - $1,200
  • Computer Software - $50-200/month
  • Web Design and Hosting - Up to $100/month
  • Furniture and Supplies - $200+
  • Telephone/WiFi Connectivity - $60-$100/month
  • Office Supplies - Pens, Paper, Post-Its, etc. - Up to $50/month
  • Marketing Materials & Services - Up to $150/month
  • Staff Training Programs - Up to $250/program
  • Cleaning Supplies and Services- Up to $100+/month

Starting an adult day care business requires careful consideration of potential risks and liabilities. Business insurance is a crucial component that provides financial protection against unforeseen events. Here’s a step-by-step guide to help you obtain the right business insurance:

  • Research the types of insurance required in your state or region, as regulations may vary. Common types include general liability, professional liability, and property insurance.
  • Contact multiple insurance providers to compare coverage options and premiums. Consider insurers with experience in the health care sector or those specializing in adult day care businesses.
  • Discuss your specific business needs with insurance agents, including the number of clients, types of services offered, and any special risks associated with your adult day care.
  • Ensure that your policy covers both the facility and transportation if your services include picking up and dropping off clients.
  • Review the proposed policies carefully, paying close attention to coverage limits, deductibles, and exclusions.
  • Choose a policy that balances comprehensive coverage with an affordable premium, and finalize the purchase to protect your business from day one.

Marketing your adult day care services is crucial for attracting clients and establishing a presence in your community. A well-crafted marketing plan should highlight the unique benefits of your services, instill trust in potential clients, and build relationships with local healthcare providers. Here are some strategies to kickstart your marketing efforts:

  • Develop a strong brand identity: Create a logo, slogan, and marketing materials that reflect the compassionate and professional nature of your services.
  • Build a user-friendly website: Ensure your website is informative, easy to navigate, and includes contact information, services offered, and testimonials from satisfied clients or their families.
  • Utilize social media: Regularly post engaging content on platforms like Facebook and Instagram to reach a wider audience and keep your day care top of mind.
  • Network with healthcare providers: Establish relationships with local doctors, hospitals, and clinics who can refer clients to your facility.
  • Host community events: Organize open houses, workshops, or seminars on topics related to adult care to draw attention to your facility.
  • Offer trial days or discounts: Encourage new clients to experience your services firsthand with special introductory offers.
  • Invest in local advertising: Consider advertising in local newspapers, radio stations, or community bulletin boards to reach your target audience.

Marketing your adult day care services is the most effective way to attract potential clients and grow your business. It starts with understanding who your target audience is, what they need, and how your services can meet those needs. Below are some steps you can take to effectively market your adult day care services.

  • Identify your target audience: Your primary target audience will be the adult children or caregivers of elderly individuals who need day care. Focus on reaching out to them through various marketing channels.
  • Create an engaging website: A user-friendly, informative, and appealing website is crucial. Ensure it provides all necessary information about your services, staff qualifications, facility, and contact details.
  • Use social media: Platforms like Facebook, Instagram, and LinkedIn can be used to reach potential clients. Share posts about your services, testimonials from satisfied clients, and any events or activities at your center.
  • Network: Attend community events, join local business organizations, and engage with healthcare professionals to spread the word about your services.
  • Offer promotions or discounts: To attract more clients, consider offering special discounts for new members or referral incentives for existing clients.
  • Quality customer service: Ensure your staff provides excellent customer service. Word-of-mouth referrals are powerful marketing tools and happy clients are more likely to recommend your services to others.

Our work is reader-supported, meaning that we may earn a commission from the products and services mentioned.

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How To Start An Adult Day Care Center In 2023

  • Last Updated: January 16, 2024
  • By: Greg Bouhl

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adult day care center business plan

If you’ve ever cared for a loved one with a physical or mental health condition, you know how demanding the job can be. Caregiving can alter their lives and be emotionally draining for families with adult family members who need continuous care or supervision. That’s where adult day care centers come in. These businesses are gaining in popularity. By opening a daycare of your own, you can help relieve families of their caregiving duties while also improving adult clients’ quality of life. It’s a rewarding business venture to explore and, with the increased need for senior care, it could be a profitable venture, too.

Business Overview

Adult day cares serve multiple purposes, and with the increasing senior population in the United States, these businesses are growing in popularity. Day care centers provide adults with a safe place to go during the day. These centers may offer a variety of services, but generally, a day’s activities will include some sort of exercise, a chance for participants to interact socially, physical or speech therapy, and mental interaction, too. Centers may assist adults with personal care as needed, and they may provide nutritious meals or snacks tailored to each attendee’s dietary needs. Transportation can be a challenge for adults, so many day cares offer transportation services, too.

Adult day cares may also specialize in a certain field. Some have a health basis, focusing on therapeutic services. Others may specialize in providing care to adults with specific conditions, like those who are deaf or hard of hearing or those with Alzheimer’s or dementia.

Day cares provide their participants with many benefits, and they can help combat some of the isolation and loneliness that adults may feel when living at home. At the same time, day cares give their attendees’ caregivers a much-needed break, helping to transfer some of the caregiving burdens off of family members during the day.

Industry Summary

According to IBIS World, from 2018 through 2023, the  adult day care industry  experienced a .9 percent annual growth, with a 2.8 percent jump for 2023. There are currently 36,362 businesses and in 2023, the industry is expected to bring in $7 billion in total revenue.

Industry Trends

Future growth of the adult daycare center industry will be based on the growing number of people who are getting older and will require community-based solutions such as those offered by daycare centers. The aging population means more adult care services are needed. Also, since many adults cannot afford the expensive cost of nursing homes and assisted living centers, driving them to seek alternative options like an adult day care center.

Additionally, according to Home Health Care News, as  more seniors wish to remain in their homes  as they age, there’s an increased demand for these day care services. The number of day care businesses has increased, but the industry is still largely fragmented.

Traditionally, adult day care facilities were largely non-profit operations, but that is now shifting more toward the for-profit model; you’ll find both models in operation today.

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Checklist To Start An Adult Day Care Center

Starting an adult day care service can be an incredibly rewarding experience, but it’s important to make sure you’re prepared for the challenges ahead. Use this checklist to help get your business off on the right foot.

Step 1:  Assess the Market

Starting an adult day care business requires a thoughtful assessment of market potential and customer base. Here are some ways you can research whether there’s a market for an adult day care business:

Census Data : Look at the demographics in your desired area. An older population might mean there is a higher demand for adult day care services. U.S. Census Bureau’s American FactFinder is a valuable resource for demographic data.

Local Government and Community Resources : Reach out to local government agencies or social service departments. They may be able to provide you with statistics about the local population’s needs. Similarly, community centers and hospitals may have data or at least anecdotal evidence about the need for adult day care.

Competitor Analysis : Identify the number and type of existing adult day care centers in your desired area. Look at the services they offer, their pricing, and their occupancy levels if available. This will help you gauge the saturation of the market.

Community Surveys : Conduct a community survey. This will give you firsthand information about the demand and need for an adult day care center. The survey can ask questions about potential users’ needs and wants, preferred pricing, and ideal location.

Professional Organizations : Join professional organizations such as the National Adult Day Services Association (NADSA) or the American Association of Caregiving Youth . They often provide research, networking opportunities, and other resources that can help you understand the market.

Healthcare Providers : Connect with local physicians, nurses, social workers, and other healthcare professionals who work with the elderly or disabled adults. They can provide insights into the potential need for such services in your area.

Area Agencies on Aging (AAA) : Reach out to your local AAA. They can provide useful data on the aging population in your area, as well as any existing services that cater to this demographic.

Online Research : Use online tools like Google Trends to analyze the search volume for terms related to adult day care in your area. This can give you an idea of how many people are actively looking for such services.

Real Estate Agents : Local real estate agents may have insights into areas with a higher concentration of senior citizens, which could indicate a potential market for your services.

Remember, market research is only the first step. It’s also important to develop a detailed business plan, secure necessary licenses and certifications, and build a strong team.

Step 2:  Write a Business Plan

After coming up with the idea, the next step in starting your business should be to write a business plan. A business plan is useful because it forces you to explain the types of services that will be offered and to think through all aspects of your operations, including staffing, licensing, marketing, and facility needs. In addition, if you are looking for funding, lenders and investors typically require you to have a business plan.

Related: How to write a business plan

Step 3: Search for a Location

Now that we have a good idea that a market exists and the business plan is underway, it’s time to find a suitable adult day care facility.

Adult day cares need very specific types of spaces, and finding or modifying an appropriate space can take both time and money. Handicap accessibility, multiple bathrooms, and the presence of a kitchen space are all necessary. The facility needs to be large enough to accommodate the number of clients you hope to serve, with room for different activities and services. A location that is already compliant with the Americans with Disabilities Act (ADA) can save you a lot of time and money in renovations.

Also, it’s important to verify your finalize is zoned right. Not all areas are zoned for adult day care businesses, so before committing to a location, ensure it is zoned appropriately and understand any restrictions.

It’s also important for the perceived safety of the clients to choose an area that’s safe and quiet, away from heavy traffic or other hazards. Factors like walkability, lighting, and general neighborhood safety can be important when someone is deciding on a facility.

When deciding on your facility, there will be renovation costs to consider. Renovations can significantly add to your start-up costs. If you’re considering a location that requires a lot of renovation, it’s crucial to get an accurate estimate of these costs before making a decision.

Initially, you may do a rough assessment of the property to identify any structural issues, electrical problems, plumbing concerns, etc. Once you are down to the final choice, be sure to have a commercial contractor or a builder with experience in renovating for accessibility and other specific needs of an adult day care center can provide an accurate estimate of renovation costs.

When estimating renovations, remember to factor in the following:

ADA Compliance: If the property isn’t already ADA compliant, modifications may need to be made for accessibility, including ramps, wider doorways, accessible restrooms, etc.

Safety Improvements: You may need to install emergency exits, safety rails, non-slip flooring, fire safety systems, etc.

Space Modifications: You might need to create specific areas like a quiet rest area, activity rooms, dining area, or therapy rooms.

Outdoor Areas: If you plan to have outdoor activities, you may need to factor in landscaping, fencing, and outdoor safety improvements.

Decor and Furnishings: The cost of paint, carpet, furniture, and other decor should also be included in your renovation costs.

Remember, a more expensive location that needs little renovation could end up costing less than a cheaper location that needs extensive work. Always consider the total cost – purchase/lease plus renovations – when comparing potential locations.

Step 4:  Secure Funding

Coming up with a good business idea and having the skills to run it are one thing, but getting the funding to start an adult day care is another. Funding to start an adult day care can be difficult as many start-up expenses go towards remodeling and working capital for wages, which don’t have collateral value. In order to get a loan, the borrower(s) will need to have good credit and be able to personally invest 15-25% towards the total start-up costs.

Some common ways to obtain funding for a business include personal savings, loans from friends or family, bank loans, Small Business Administration (SBA) loan guarantees, and investors.

It’s normally rare to find grants for a business, but there may be federal, state, and private grants available for businesses serving the elderly or disabled. For instance, the Administration for Community Living (ACL) offers grants that might be applicable. In some cases, setting up your adult day care as a nonprofit organization may open up additional funding opportunities, including more grants and donations.

Related:  Finding the money to start a business

Step 5: Register for Business Licenses and Permits

The next step in starting your adult day care business is to make sure it’s properly registered and legal to operate. It’s important to note, however, that the exact process can vary from state to state, so you’ll need to check the specific requirements for your location. Here’s a general guide to the key registrations:

Form a Business Structure: The first thing you’ll need to decide is what business structure is best for your business. This could be a sole proprietorship, a partnership, a limited liability company (LLC), or a corporation. Each of these structures has different implications for liability, taxes, and administrative complexity. Many small business owners opt for an LLC because it provides personal liability protection and has fewer administrative requirements than a corporation.

Related: Comparison of business structures

Register Your Business Name: After registering the business structure, you may need to register your business name. This process will vary depending on what business structure you pick. Sole proprietors and partnerships will often be required to register a “Doing Business As” (DBA), while corporations and LLCs register with the state.

Related: Tips and ideas for naming an adult day care

During this time, it’s also a good idea to check if the name you want is available as a web domain, even if you’re not ready to set up a website yet.

Related: Finding a domain name for your business

Obtain Business Licenses and Permits: Because there isn’t an official federal definition of what adult day care consists of, different states regulate this industry differently. Some states have no licensure, while others have licensure and certification requirements. Some states also require a day care have a certain number of caretakers for every day care participant; 1:6 and 1:8 ratios are common requirements.

To start researching requirements in your state, check with your state’s Department of Human Services to learn about the specific state requirements. The U.S. Department of Health and Human Services has compiled a helpful document entitled  Regulatory Review of Adult Day Services . In general, you’ll typically need to pass health and safety inspections, have a certain amount of space per client, and maintain certain staff-client ratios. Staff may also need to pass background checks and have specific training or certifications.

Also, if you plan to provide any health-related services, you may need to comply with additional regulations, such as the Health Insurance Portability and Accountability Act (HIPAA).

In addition, there are general business registrations that an adult day care might need, such as a business license, Employer Identification Number (EIN), and Occupancy Permit, among others.

Related: State guides for business licensing

Step 6:  Acquire the Property

After securing funding and acquiring a location for an adult day care center, the next step to prepare the location for opening:

Renovations and Setup : The facility will need to be renovated and set up to accommodate the specific needs of an adult day care. This might include installing wheelchair ramps and handrails, setting up a kitchen and dining area, creating rest and activity spaces, and ensuring there are ample restroom facilities.

Safety Measures : Safety is paramount in an adult day care setting. All areas of the facility should be free of hazards. This includes securing rugs and carpets to prevent trips and falls, removing any potential choking hazards, and ensuring the facility is well lit. Emergency exits should be clearly marked, and fire extinguishers and first aid kits should be readily accessible.

Regulatory Compliance : Once renovations are complete, the facility will need to pass health and safety inspections. Your local health department or relevant regulatory body will provide you with a list of requirements.

Furnishing : Furnish the facility with comfortable and functional furniture. Ensure there are enough seats, tables, and rest areas for all clients.

Equipment : Depending on the services you offer, you may need to acquire certain equipment. This could include medical equipment, kitchen appliances, entertainment devices, etc.

Signage : Install clear signage, both inside and outside the facility. This can help make the environment more navigable and welcoming for your clients and their families.

Step 7:  Get your Marketing Plan in Place

Marketing an adult day care business effectively requires a diverse and multi-pronged approach that emphasizes the unique value proposition of your services while reaching out directly to your target audience.

To start, establish a strong online presence through a professional website that clearly communicates the services you offer, your qualifications, and your commitment to caring for your clients. Including testimonials and success stories can greatly enhance your credibility.

Also, utilize social media platforms to share useful content, interact with your community, and highlight positive aspects of your day care. Platforms like Facebook are particularly effective due to the demographic they cater to.

Next, consider traditional marketing strategies like print and local media advertisements, brochures, and flyers. Host open houses and community events at your facility to allow potential clients and their families to experience your services firsthand.

Partnerships are also vital. Collaborate with local hospitals, clinics, senior centers, churches, and community organizations that can refer potential clients to your center.

Last, remember the power of word-of-mouth marketing. Provide excellent service and encourage satisfied clients and their families to recommend your facility to others. Offering a referral program can incentivize this process.

There’s still a lot of confusion and lack of awareness around adult day center availability and benefits, so business owners need to be prepared to market the business and educate local medical service providers, assisted living centers, senior centers, and family caregivers. While adult day cares are gaining in popularity, they’re still somewhat limited in their availability. While this means that businesses will need to work harder to establish themselves, it also works as an advantage. A new adult day care could be the first in the area, establishing itself as a reputable, quality facility before others develop in the area.

Each of these strategies can contribute significantly to building your client base and positioning your adult day care center as a trusted and respected resource within your community.

Related:  Low-cost ideas to market a new business

Step 8: Hire & Train Employees

Hiring the right staff is crucial for the success of an adult day care business, as they play a significant role in ensuring the health, safety, and overall well-being of the clients. They’re also the ones who create a warm and nurturing environment, making the facility a ‘home away from home’ for many adults.

Your team will likely be composed of various roles, including adult day care directors, nurses or nursing assistants, program coordinators, activity leaders, and administrative staff.

The salary of your staff will depend on their role, experience, and location. On average, adult day care directors may earn between $40,000 and $60,000 per year, while registered nurses can earn from $50,000 to $80,000 annually. Nursing assistants may earn around $20,000 to $30,000 annually. Activity leaders and administrative staff may also fall within a similar range, depending on their responsibilities and experience. Please note these are broad averages and actual salaries can vary.

When hiring for an adult day care center, consider these specific tips:

Skills and Qualifications : Different roles require different qualifications. For example, any medical staff should have appropriate licensure, while activity leaders should ideally have experience in recreation or social work. Ensure all employees meet the state’s training requirements for their role.

Experience in Elder Care : Experience working with seniors or disabled adults is crucial, as this population has unique needs and challenges.

Background Checks : Given the vulnerable population you’re serving, thorough background checks are essential to ensure the safety and trustworthiness of your staff.

Personality Traits : Look for individuals who are patient, empathetic, and have excellent communication skills. Working in an adult day care center can be challenging, and these traits are key to providing high-quality care.

Training : Once you’ve hired your staff, it’s important to provide them with thorough training. This should cover your policies and procedures, emergency protocols, client handling, and any specific care techniques they’ll need to know.

Continuing Education : Encourage and facilitate continuing education for your staff. This could be through workshops, courses, or attending relevant conferences. Keeping up to date with the latest best practices in adult care is crucial for providing the best possible care.

Remember, your staff is the face of your adult day care business, and their skills and demeanor will significantly impact your reputation and the quality of care you provide.

Related:  Hiring your first employee

Step 9: Prepare to Launch

Starting an adult day care business is a fulfilling venture that requires thorough preparation and attention to detail. Beyond all the previously discussed steps, there are a few other critical aspects you must consider to ensure smooth operations and financial management.

Insurance : Insurance is essential in this business. You’ll need to secure general liability insurance, worker’s compensation, and property insurance at the least. Consider professional liability insurance too, especially if your center will be providing medical or therapeutic services.

Bookkeeping : Proper bookkeeping is vital for financial management and tax purposes. You can use software like Wave Accounting (FREE) or Quickbooks , or hire a professional bookkeeper or accountant. Keep track of all income and expenses to understand your financial health and simplify tax filing.

Related:  Setting up the accounting for your business

Bank account and credit cards: Open a business bank account to separate your personal and business finances. This makes bookkeeping easier and can protect your personal assets. Also, consider getting a business credit card to help manage expenses and potentially earn rewards.

Payment processing : You’ll need a reliable way to accept payments. Many businesses today accept credit cards, which require a merchant services account. Companies like Square or Stripe make it relatively simple to accept card payments, even from mobile devices.

Management software: To keep up with patient care and industry regulations, using adult day care software can help with the management of your center.

Policies and procedures: Draft clear policies and procedures for all aspects of your business, from client intake to handling medical emergencies. This ensures consistency and can protect you legally.

Network: Building relationships with other businesses, community organizations, and healthcare providers can help increase your referrals and make it easier to coordinate care for your clients.

While these are some general guidelines, the needs of every adult day care center will be different based on factors like location, size, and the specific services provided. Therefore, it’s always a good idea to consult with professionals in the field, like a business advisor or lawyer, to ensure all bases are covered. Starting an adult day care business is a significant undertaking, but with careful planning and a commitment to providing quality care, it can be a deeply rewarding endeavor.

Adult Day Care Startup FAQs

How much does it cost to start an adult day care.

Starting an adult day care business requires a significant initial investment. However, the exact cost can vary significantly depending on the size of the center, its location, the range of services provided, and other factors. Here are some of the primary costs you’ll need to consider:

Property Acquisition/Lease : Whether you buy or lease a property, this will likely be one of your largest expenses. The cost can vary greatly depending on your location and the size and condition of the property.

Renovations and Setup : The property will need to be renovated and furnished to serve as an adult day care center. This could include installing ramps and handrails, setting up a kitchen and dining area, creating rest and activity spaces, and ensuring there are ample restroom facilities. The cost of renovations will depend on the current state of the property and the specific modifications needed.

Equipment : You’ll need to purchase various equipment, including medical equipment (if providing health-related services), kitchen appliances, furniture, office equipment, etc.

Insurance : The cost of insurance can vary greatly, but expect to pay several thousand dollars per year for comprehensive coverage. This includes general liability insurance, property insurance, workers’ compensation, and potentially professional liability insurance. The cost will depend on factors like the size of your center, the number of employees, and the types of services provided.

Licenses and Permits : The cost of obtaining the necessary licenses and permits can vary depending on your location, but could be in the range of several hundred to several thousand dollars.

Staff Salaries : You’ll need to pay your staff competitive wages to attract and retain quality employees. The total cost will depend on the number of employees and their respective roles.

Marketing and Advertising : Budget for marketing and advertising expenses to attract clients to your new center. This could include costs for website development, brochures, local advertising, and more.

Operating Expenses : Don’t forget to budget for recurring expenses like utilities, food and supplies for clients, maintenance, etc. It’s generally recommended to keep three to six months of operating expenses on hand as a buffer.

Given the variables involved, it’s difficult to provide an exact estimate without specific details. However, you could expect the start-up costs for an adult day care business to be in the range of $100,000 to $500,000 or even more, especially if purchasing a property. It’s essential to create a detailed business plan with a comprehensive budget to understand your funding needs and ensure the financial viability of your venture.

How much can an adult day care owner make?

The profitability of an adult day care business can vary widely based on factors such as the size of the facility, the number of clients, the fees charged, the services offered, and the operational costs. Generally, the revenue of an adult day care center is calculated by multiplying the number of clients by the daily rate and the number of days the center operates per year.

According to Genworth Financial’s most recent Cost of Care Survey,  adult day health care costs  an average of $72 per day. Most days range between 8 and 10 hours of care. So, for this example, let’s say an adult day care center charges an average daily fee of $70 per client and has an average daily attendance of 20 clients. If the center operates 5 days a week for 50 weeks a year (allowing for holidays), the annual gross revenue would be:

$70 (daily rate) * 20 (clients) * 250 (days) = $350,000.

From this gross revenue, you’ll need to subtract your operational costs, including staff salaries, rent or mortgage payments, utilities, insurance, food and supplies, marketing, maintenance, and more. If your total operating costs are $250,000, for instance, your net income before taxes would be:

$350,000 (gross revenue) – $250,000 (operating costs) = $100,000 .

However, these numbers are purely hypothetical and actual earnings can vary significantly. Factors like local market conditions, the reputation of the center, and the quality of care provided can greatly influence profitability. Therefore, it’s critical for potential business owners to create a detailed business plan and financial forecast before starting an adult day care center.

Another profit generator for your facility can be through hosting events while the facility is closed. If you aren’t open on the weekends, consider renting out your space to be used by participant families for baby showers, birthday parties, holiday gatherings, etc

What skills are needed to run an adult day care?

Starting and running an adult day care doesn’t require a business degree, but certain skills and experiences can increase the chances of success.

Caregiving experience.  Experience in caring for adults with mental or physical conditions is highly valuable in this industry. A day care owner who has this caregiving experience will have a better understanding of the challenges and nuances that come with this type of business.

Medical knowledge.  A day care owner doesn’t necessarily need a medical degree, but experience working in or knowledge of the medical industry will be helpful.

Management experience.  Experience in hiring, training, and managing staff is important in this industry since any day care will need multiple employees.

Interpersonal skills.  Strong customer service and interpersonal skills are a must, and they’ll allow a business owner to establish relationships with both clients and their families.

Attention to detail.  Small details can make big differences in this industry regarding caregiving, scheduling, monitoring clients’ health, and more. A business owner needs to be focused on details to be successful.

Marketing skills.  While adult day cares are growing in popularity, many people are still unaware that they exist and need to be informed of their benefits. Marketing will be an ongoing activity, so a business owner will need to be involved in marketing efforts.

What is the NAICS code for an adult day care?

The NAICS code for an adult day care is 624120.

The NAICS code (North American Industry Classification System) is a federal system to classify different types of businesses for the collection and reporting of statistical data.

Related: What is a NAICS code?

Resources: Aging Life Care Association American Health Care Association National Adult Day Services Association  (NADSA)

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Greg Bouhl

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How to Start an Adult Day Care Business in 14 Days (In-Depth Guide)

Updated:   January 31, 2024

BusinessGuru.co is reader-supported. When you buy through links on my site, we may earn an affiliate commission. Learn more

The adult day care industry brought in over $16.5 billion in revenue in 2022. With over 4,700 licensed adult day care centers nationwide, the industry continues to grow. The projected compound annual growth rate is 5.10% from 2022 to 2030.

adult day care center business plan

Baby Boomers age into retirement. Demand is ever-increasing for these community-based centers that provide social activities, meals, and health monitoring during daytime hours. For entrepreneurs interested in tapping into this expanding market, an adult day care can offer a rewarding small business opportunity with the chance to make a real difference in the lives of the elderly.

From assisted living activities to monitoring chronic health conditions, adult day cares to fill a vital need for seniors still living at home but requiring some support. This guide will walk you through how to start an adult day care. Topics include market research, competitive analysis, registering an EIN, forming an LLC, and more.

1. Conduct Adult Day Care Market Research

Market research is integral to starting an adult daycare center. It provides insight into needs within the human services industry, trends in products and services, your target market, and local market saturation.

adult day care center business plan

Some details you might learn through market research include:

  • With 10,000 baby boomers turning 65 every day, the target demographic is rapidly growing.
  • The adult day care sector sees demand from two primary channels.
  • First is elderly individuals still living independently or with family.
  • Second is caregivers needing daytime supervision for relatives with disabilities or medical conditions.
  • Caregiver statistics show over 43 million Americans currently provide unpaid elder care.
  • Adult day cares appeal to caregivers struggling to balance jobs and elderly relatives.
  • Industry reports show dementia care is the fastest-growing segment.
  • Alzheimer’s diagnoses are projected to triple by 2050.
  • Recreational activities are a big part of adult day care centers.
  • The increasing elderly population, growth of age-related diseases, and rise of long-distance family caregivers provide a supportive environment.
  • Entrepreneurs can capitalize on this forecast by providing quality community-based daytime care.

With low barriers to entry, limited licensure requirements, and durable demand drivers, an adult daycare can offer a sustainable small business model. As you conduct market research you’ll learn more about the needs of local senior centers to bolster your business plan and obtain the required documents to get started.

2. Analyze the Competition

For an adult daycare owner, conducting competitive analysis is vital when entering the local market. This involves evaluating nearby facilities in terms of services, quality of care, staff competency, facilities, and reputation.

adult day care center business plan

Some ways to learn about local competitors in the adult day care service industry include:

  • The first step is identifying existing brick-and-mortar operators around your targeted location.
  • Gather key details on each like capacity, years in business, specific population served, and operating hours.
  • Visit their website and social media pages to understand their digital footprint.
  • Evaluate their web content, online community engagement efforts, customer reviews, photo galleries, and educational resources for potential visitors and referral sources.
  • Identify highly rated competitors with strong community connections.
  • Conduct anonymous tours of each facility.
  • Gauge firsthand their environment, caregiver interactions, amenities, activities, safety protocols, and transportation offerings.
  • Take detailed notes on competitive strengths and weaknesses.
  • Talk to locals like geriatric doctors, case workers, and support group leaders to learn about their reputations.
  • Scout locations and neighborhoods to spot influential feeder organizations. Identify where competitors get referrals and talent.
  • Use insights gathered to shape your positioning.
  • Offer niche services like dementia or Alzheimer’s care if lacking locally.
  • Improve upon weaknesses like limited hours, qualifications, staff turnover, activities, or dated facilities.
  • Leverage relationships and referral channels competitors have not tapped.
  • Assign resources to match identified strengths.

Staying abreast of competitors through continued research helps quickly respond to changes after launch. Competitor analysis offers additional information into your potential new business. Monitoring the expertise of other eligible local daycares helps you navigate vital regulations and carve out a place for yourself.

3. Costs to Start an Adult Day Care Business

When starting a successful adult daycare service, substantial upfront investment should be planned for. Knowing what your budget is helps you secure funding options for your own set up. Let’s take a look at the costs your adult daycare may encounter as you operate.

Start-up Costs

  • The first major start-up costs in health services involve researching state licensure for adult care facilities. Fees range widely but application and approval expenses often total $2,500+.
  • Leasing an appropriately zoned building with adequate space for planned capacity requires a commercial real estate agent and legal fees averaging $3,000+.
  • Triple net leases with operating expense responsibilities are common, ranging from $8-20+ per square foot monthly.
  • Tenant improvements like handicap access upgrades, kitchen fittings, and durable flooring could require an extra $30,000+.
  • Hiring an Administrative Director and Caregiver staff will likely be a new owner’s biggest recurring cost. Competitive wages and benefits packages are vital for attracting trained talent with senior care experience.
  • A Director earning $65,000+ and a minimum Caregiver-to-client ratio of at least 1:6 will necessitate a payroll budget of $150,000+ annually.
  • Outfitting the care environment is equally important. Transport vehicles, commercial kitchen equipment, and laundry machines carry hefty price tags.
  • Key safety gear like lift equipment, secure wandering resident technology, and specialized therapeutic accessories can total $75,000+.
  • Comfortable, adaptive furniture is central for participant well-being, averaging $15,000+.

Other key start-up costs include computers/software for intake, health tracking, and family communications ($5,000+), phone systems enabling secure community spaces ($3,000+), marketing collateral to attract referrals ($2,500+), and 6 months of general liability coverage ($6,000+).

Ongoing Costs

  • While launch costs are daunting, operating an adult day center involves major recurring overhead. Personnel wages often represent 60%+ of monthly outlays.
  • Facility rent/maintenance, food, utilities, supplies, and insurance also strain cash reserves until higher enrollment is achieved.
  • Payroll overhead remains most facilities’ largest obligation as specialized staff is required to meet care standards.
  • Budgeting $250,000+ yearly enables competitive wages, employer taxes, and performance incentives to retain experienced teams.
  • Hiring bonuses and training costs from 25% turnover rates also add expenses.
  • Feeding clients breakfast, lunch, and snacks requires an average of $12 per person daily. This nutrition outlay for 30 participants tops $65,000+ annually.
  • Medical supplies/prescriptions, activity materials, cleaning products, and office items are similarly all recurring costs.
  • State licensure and federal reporting mandate documented policies, regular staff development, and detailed record audits.
  • Staying compliant through Admin hours and quality oversight helps ensure safety. Continuing education and professional services engagements to strengthen family trust add $15,000+ in annual expenses.

With revenues from private pay and long-term care insurance driving intake, maintaining consistent quality and community focus is imperative. As reputation strengthens and referrals grow over months and years, profit potential follows. Budgeting realistically for launch and operations costs helps ensure stability.

4. Form a Legal Business Entity

When starting an adult daycare, owners must choose a legal structure. The four main options—sole proprietorship, partnership, corporation, or LLC—impact taxation, liability exposure, and operations. For this hands-on senior service, an LLC balances flexibility with protection.

Sole Proprietorship

A sole proprietorship constitutes the simplest framework. This entails owners using their social security number for tax ID purposes and claiming all profits/losses on personal returns. However, proprietors hold unlimited liability for debts and legal claims, placing personal assets at risk. This exposure makes sole proprietorships ill-advised for adult care centers.

Partnership

Partnerships allow multiple owners to share control and split income via pass-through taxation. But similar to sole proprietors, general partners remain personally liable for obligations like accidents, negligence claims, or lawsuits. For a business with health and safety duties, unchecked liability makes partnerships an insecure option.

Corporation

A corporation protects owners’ assets from institutional debts and judgments. Shareholders risk only their invested capital. Corporations also provide the easiest structure for attracting outside investment, conducting interstate activities, and ultimately offering shares publicly. However extensive recordkeeping, tax filings, and legal compliance make this entity costlier.

Limited Liability Company (LLC)

For most adult daycare owners, an LLC combines liability protections with pass-through taxation and flexible management. LLC status shields personal assets from legal actions and containment risks, unlike sole proprietorships and partnerships. Compared to corporations, compliance demands remain fewer while ownership rules stay negotiable.

Tax-wise, income, and deductions flow through to members’ returns, avoiding double taxation. Overall, the LLC structure strikes an optimal balance of protection, flexibility, and affordability for hands-on elder care businesses.

5. Register Your Business For Taxes

Once your adult day care LLC formation documents are filed, securing federal and state registrations legally enables operating. An Employer Identification Number (EIN) from the IRS and state sales tax ID serve vital functions. Both are free and easily obtainable online.

An EIN essentially functions as a social security number for companies, used for tax purposes and employer-related services. LLCs need an EIN to open business bank accounts, legally pay employees, and report income. Sole proprietors can use SSNs but partnerships/corporations require one.

Applying takes just minutes at IRS.gov . Simply confirm your LLC exists, answer basic identification questions, and provide owner/responsible party details. After submitting, your EIN is immediately issued on screen to save or print.

With EIN in hand, registering with your state taxing authority to collect/remit sales tax is also essential. Failing to charge appropriate sales tax on goods/services sold risks financial penalties.

Each state maintains individual procedures but many let businesses apply online. You’ll submit your EIN, business activities category, ownership structure, and contact information. Sales tax IDs are instantly issued digitally in most areas without delay. Minimal application fees may apply in certain locations.

Displaying both EIN and sales tax ID demonstrates credibility with vendors, partners, and clients. Keeping tax licenses current also complies with IRS requirements to deduct business expenses. Setting up necessary registrations early enables the smooth launching of adult daycare operations.

6. Setup Your Accounting

Managing finances appropriately is critical when launching an adult daycare center. From budgeting adequately to separating expenses to retaining accounting help, fiscal diligence early on enables stability.

Accounting Software

After filing formation documents, one of the first steps should be implementing small business accounting software like QuickBooks . Linking bank/credit card accounts allows transactions to automatically download into pre-configured categories. Income and expenses are seamlessly tracked with minimal manual entry. Payroll, invoicing, and reporting functions are also integrated.

Hire an Accountant

Hiring an accountant remains ideal despite technology assistance. Experienced bookkeeping professionals handle needs like monthly closes, cash flow analysis, reconciliations, depreciation, and sales tax calculations for reasonable hourly fees. Simply gathering year-end tax paperwork for filing annual returns can cost $500-1,500.

Open a Business Bank Account

Maintaining strict separation between business and personal finances remains essential for adult care owners. IRS scrutiny triggers easily from mingling expenses or unclear recordkeeping. Opening dedicated small business checking/savings accounts and utilizing a distinct business credit card simplifies delineation.

Apply for a Business Credit Card

Business cards consider company revenues, not owner credit scores when assigning limits. Building independent commercial credit also enables financing in the company’s name for future needs. Providing EIN, legal documents, and projected financials when applying facilitates approval.

7. Obtain Licenses and Permits

Before welcoming the first participants, adult daycare owners must ensure proper permissions are secured. Find federal license information through the U.S. Small Business Administration . The SBA also offers a local search tool for state and city requirements.

The central clearance needed is state licensing as an adult day services program applicant. Requirements like minimum operating days/hours, facility specs, and staff training levels vary by location but all mandate rigorously vetted health and safety procedures.

Additionally, local municipalities require clearance for new businesses through zoning permits and occupancy certificates. Zoning approval ensures appropriately designated building use and land usage for care facilities within that district. Inspector examinations then confirm on-site compliance with fire, construction, accessibility, and electrical safety measures.

Kitchens serving daily meals mandate meeting health department codes as well. Equipment like commercial refrigerators, dishwashers, and food prep must align with state specifications. Staff servicing food must clearance health screens and food safety training.

Transport vehicles operated by the facility also need validation. Beyond regular maintenance, documented driver background checks, license verifications, and safety protocols must be submitted for review. Annual validation stickers visibly reassure families of diligent oversight.

Facilities offering specialized memory care or medical services often require additional clearances too like managed care certifications. Extra staff training and programming permissions help ensure adequate support resources.

8. Get Business Insurance

Operating an adult day care without proper insurance exposes owners to substantial financial risk. For a business responsible for vulnerable seniors’ well-being, coverage provides vital protection that leaders would be remiss to overlook.

The foremost liability to mitigate is injury claims. Despite close supervision, participant falls or accidents can occur. One lawsuit could quickly bankrupt most small companies without liability coverage. Policies covering up to $2 million in legal judgments and settlements provide prudent shields for owners’ assets.

Equally hazardous are employee claims like harassment allegations or wrongful termination suits. Even unfounded cases rack up tens of thousands in legal costs. Employment practices liability insurance fills this gap to fund legal defenses.

Property risks also loom without policies guarding physical assets. Storm damage, vandalism, or kitchen fires could destroy the facility. Business property insurance covers repair and replacement so operations can resume. Some carriers even pay for temporary relocation if needed during the rebuild.

Guarding the business’ future requires four key steps:

  • Inventory assets at risk – building, vehicles, equipment, electronics, data
  • Assess risks like regional weather, aging facility, participant mobility issues
  • Research specialized coverages that mitigate identified threats
  • Compare quotes from highly rated insurers

Protecting years of sweat equity and hard-earned revenue only requires an hour or two upfront selecting tailored policies. Avoiding coverage gaps through a licensed agent’s guidance then lets owners focus on enriching elderly lives rather than worrying over catastrophic liabilities.

9. Create an Office Space

Operating an adult day care center is a hugely involved undertaking. While the prime focus stays on participants and programming, securing office space for administrative needs provides critical infrastructure. Location options balancing convenience, professionalism, and affordability should be thoughtfully weighed.

Home Office

Many new owners initially default to home offices for maximum convenience. However, conducting tours, interviews, and family meetings in personal living spaces risks seeming less established. Prospects may question the seriousness of operations that are fully home-based. Dedicated work areas also simplify separating business and personal worlds to avoid IRS scrutiny.

Since you’re not starting a private home care business , I recommend against making your home your office.

Coworking Office

For under $200 monthly, coworking spaces like WeWork offer professional environments sized for small teams. Accessible conference rooms facilitate meetings and calls without houseguests overhearing. Complimentary amenities like internet, printing, and front desk staffers also elevate credibility when bringing visitors on-site.

Retail Office

Retail space enables customer-facing visibility but can prove costlier. Street access aids marketing efforts to neighborhood seniors but limits privacy for sensitive discussions. Minimum 12-month leases at $25 per square foot also require heavier traffic to justify over shorter-term flex space.

Commercial Office

Once revenue stabilizes, moving into dedicated commercial suites housing all operations in one campus may suit some owners’ quality standards best. Custom buildouts present a polished setting for community events and training too while keeping caregiver teams under one roof. If the budget allows, unified bases inspiring trust and organizational identity prove ideal.

10. Source Your Equipment

Launching an adult day care requires extensive outfitting to serve seniors safely and comfortably. From specialized lift equipment to ergonomic furniture, finding affordable equipment that meets clinical standards takes strategic sourcing across new, used, and rental suppliers.

Purchasing brand-new medical tools like vital signs monitors, blood pressure cuffs, and wound therapy devices ensures peak precision for staff caregivers. Hospital liquidators offer deep discounts on current models while dealer demos carry full warranties at 20-30% savings. Finance programs are also commonly available to ease cash flow impacts for owners.

However, costs can stay manageable through secondhand buys too. Marketplaces like Craigslist , Facebook , and eBay connect local sellers to clear surplus wheelchairs, resident beds, or mobility walkers from facility upgrades. Hands-on inspection before transacting verifies items adequately function while peer sourcing builds community connections.

For short-term needs or replacing aged equipment, renting medical gear also sustains budgets. Online inventory from suppliers like USA Medical Supply enables browsing regional availability of hospital beds, oxygen units, or ambulatory devices by the week/month. Some offer trial periods to assess resident response before long-term leases.

11. Establish Your Brand Assets

Establishing a distinct brand presence elevates an adult daycare’s credibility and memorability within the community. From logo development to web presence, branding signals organizational polish.

Get a Business Phone Number

Claiming a toll-free business line via providers like RingCentral upgrades perceived legitimacy over personal cell numbers. Call routing, voicemail, and built-in texting also systemize communications.

Design a Logo

Creating a visual brand identity starts with a logo evoking organizational spirit. Friendly designs with senior-friendly fonts and accessible color palettes make suitable matches. Sites like Looka offer affordable DIY tools or custom creator connections.

Print Business Cards

Business cards enable effortlessly sharing contact info while reinforcing styling. Cards should display key data like address, phone/email, certifications claimed, and found date. Leading online printer Vistaprint offers durable cardstock options perfect for purse storage.

Buy a Domain Name

Securing a matching domain gives web visibility and email address gravity. Aim for straightforward, professionally relevant URLs purchasable through registrars like Namecheap .

Design a Website

Building out websites fuels digital discovery by families plus organizational transparency. User-friendly site builders like Wix facilitate quick DIY drafting with modern templates. Or specialized developers found on Fiverr affordably create custom, accessibility-focused sites.

12. Join Associations and Groups

Beyond state regulators, a wealth of local networks and peer groups can provide invaluable wisdom for adult daycare entrepreneurs. Tapping this village accelerates success through shared knowledge.

Local Associations

Regionally, longevity-focused business alliances like LeadingAge offer intersections between elder care owners, universities, and affiliated services. Access to trend insights, training discounts, and referral pipelines results from joining.

Local Meetups

Event clearinghouses like Meetup also list lectures, mixers, and conferences relevant to senior services. Building community connections and continuing education there keeps best practices fresh. Exchanging war stories and bouncing ideas off fellow owners creates welcome support too.

Facebook Groups

Industry-specific Facebook Groups open more crowdsourced growth channels. For example, the Adult Daycare Providers Resource Group shares hundreds of peers facing similar opportunities. Getting granular with local offshoot groups around care specialties or regional subtopics produces niche exchanges.

13. How to Market an Adult Day Care Business

Growing an adult daycare relies heavily on effective community outreach. With compassionate service as the core product, spreading awareness of organizational competency and values becomes marketing’s central charge.

adult day care center business plan

Personal Networking and Referrals

Satisfied families and hospital partners serve as the most resonant advocates. Offering referral bonuses, exclusive participant events or public recognitions for big contributors turbocharges word-of-mouth channel development early on.

Digital Marketing

Digital platforms should also be leveraged to cast wider nets for caregiver attention. Dedicated Google/Facebook ads invite targeted trial sign-ups from local zip code searches for terms like “dementia care options near me”. Promoted social posts boost caregiver testimonials.

Additional digital channels such as:

  • Optimizing Google Business Profile with photos, offerings details, and prominent website linkage
  • Launching an email newsletter with care tips, new programming highlights, and upcoming community seminars
  • Posting weekly programming recap videos to TikTok and Instagram Reels noting recent activities
  • Guest blog pitching to senior-focused outlets detailing specialty service offerings
  • Partnering with multi-center review sites like Caring to share family endorsements

Traditional Marketing

Traditional opportunities to connect with referral sources persist as well:

  • Hospital, clinic, and skilled nursing reps visit marketing with brochures
  • Local community center, church, and library talks invite prospective tour sign-ups
  • Care manager association meeting exhibits attach care team faces to services
  • Chamber of Commerce sponsored mixers to meet business neighbors

With touchpoints spanning both digital and tangible channels, conveying care quality and trustworthiness fuels stabilizing enrollment and revenue.

14. Focus on the Customer

For adult day cares, delivering compassionate customer service represents the core product families are purchasing. Caregivers entrust owners to enrich loved ones’ physical health, cognitive activity, and social connections when they cannot. Some ways to improve customer focus in health services include:

  • Staff should exude genuine warmth while assisting attendees.
  • Remembering personal details about grandchildren or nostalgic songs builds bonds bolstering engagement.
  • Care teams can further customize festivities to individual interests and mobility levels so no one feels excluded.
  • Even simple assistance like timely toileting helps maintain dignity.
  • Extending heartfelt support to caregivers also earns loyalty.
  • Listening empathetically as elders transition from independent living builds trust in an owner’s guidance.
  • Checking in consistently with usage feedback makes families feel heard.
  • Little customer experience touches like sending handwritten birthday cards to registered seniors nourish community ties.

When personnel exude selfless care rooted in understanding people’s often difficult journey, positive word-of-mouth spreads. Local hospitals instinctively know where to guide new dementia diagnoses. Caseworker appreciation drives recurring contract renewals.

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How To Start An Adult Day Care Business

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adult day care center business plan

Let’s be very clear about something: an adult day care business is not something you should go into lightly.

There are regulations and strict guidelines involved, and people’s lives are in your hands.

So, if you’re just looking to make a quick buck, stop reading right now. This is not the business for you.

However, if you have a passion for helping people and want to do some good in the world (while earning some extra income), this may be exactly the kind of business you want to explore.

The cost of a full-time care facility can be way too expensive for a lot of families – even if Medicare kicks in for part of the bill. Other families just aren’t ready to commit their parents and grandparents into an institutional living situation.

Instead, they make the commitment to care for them in their own homes for as long as possible. Regardless, the families still need time to go to work, run errands, go to school and have an occasional day off to recharge from the constant demands of 24/7 care giving.

This is where an adult day care can really help. By committing to take the highest possible quality care for these loved ones, an adult day care gives families the time and freedom they need to continue to live their lives and continue to earn an income.

The truth is that so many of these facilities have waiting lists because there is such a strong demand for adult day care services. If you enjoy helping others, keep reading and we’ll cover everything you need to know to start an adult day care service of your own.

Step 1: Learn How an Adult Day Care Business Works

adult day care center business plan

Before you even consider letting families entrust their loved ones to you, you must understand how this business works.

And the best way to do that is to be trained and gain experience by working at an existing adult day care facility.

Yes, you can learn all about medical conditions and regulations through books and videos. But until you hold an elderly woman’s hand as she walks down the hall, or listen to the memories of a WWII veteran as he tells you about how he first met his wife, until you actually form a relationship with these people, then understand what it is to operate an adult day care service.

And honestly, these facilities always need help. So even if it’s only as a volunteer, go and help out.  They’d be glad to take you in. Talk to the day care attendees. Ask them what they like and dislike about being at an adult day care facility. Talk to the staff. Ask them what they like and dislike about working there.

That’s called market research. You’re learning how to improve your future service by getting real, practical answers from your target demographic for both future clients and future employees.

Once you’ve seen how the day to day care of the business works, how the hiring, scheduling, and ordering of supplies works, how the storage and distribution of medicine works, how the maintenance and upkeep of the facility works, then you’re ready to dig into the legal requirements of how to start an adult day care.

Click here to find your state’s adult day services regulations and requirements .

You can also look for training and workshops in your area by checking with the National Adult Day Services Association’s list of strategic partners.

Step 2: Create a Plan

adult day care center business plan

Why does an adult day care business fail?

Simply put, for the same reason as many other businesses – it’s the lack of a plan.

An adult day care business are not a simple operation.

By now, you should have completed all your research on legal requirements and on the day-to-day operations of an adult day care business.

There is a lot of care, time, effort, and resources that go into this industry. The purpose of creating a business plan is so you have a roadmap to follow. When the time for action and decisions comes, you don’t have to pause to consider your choice. You already know it. You thought it out well in advance and made your decision long ago. Now, you simply follow your business plan and execute.

Consider your costs, your audience, your marketing, your hiring, your location, an in-depth market needs analysis, and many other things when creating your business plan. The goal here is to get your mind focused on your business so that you can answer any and all questions regarding what comes next.

If you’re not sure where to start, Startup Jungle can help you create an expertly organized and professional business plan for your adult day care business.

Just email [email protected], and they’ll give you the help you need.

Step 3: Discover Earning Potential

adult day care center business plan

How much do adult caregivers make?

Well, that depends on the position.

Assistants range from $9.55 to $22.85 per hour depending on experience and tenure. That comes out to about $19,000 to $48,000 a year.

A manager’s salary can run from $9.74 to $25.87 an hour, or $21,000 to $48,000 a year.

And a  healthcare administrator salary can range between $25,016 – $70,973 a year.

As for an adult day care facility, AdultDaycare.org reports that the national average for adult day care charges is about $1500 per month. This is a deal compared to full-time care in a skilled nursing home, which averages  $6700 a month, or an assisted living facility, which averages  $3600 a month.

For occasional care, state averages range from $36 to $122 a day depending on the level of care required.

To really figure out your earnings potential, you must first examine all costs and then subtract them from what your rates will be multiplied by how many clients you expect to provide care to.

The National Adult Day Services Association reports that the number of adult day care services has risen by nearly 25 percent since 2010, continuing a previous growth trend in the industry. As of 2014, they counted 5,685 adult day care programs in the United States.

The baby boomer population is one of the largest age groups in the country, and they’re reaching the age where many of them are beginning to need adult day care services for needs such as Alzheimer’s, dementia, and other age-related conditions that necessitate full-time care to ensure their safety.

There’s a growing need for adult day care services, meaning your earnings potential can only go up.

Step 4: Set a Budget

adult day care center business plan

How much does it cost to open an adult day care business?

It’s really tough to nail down exact numbers for the startup of an adult day care, but it’s not cheap.

A lot of it depends on the scope of your operation.

Do you plan to build or remodel an existing stand-alone facility for a lot of residents? Or does a small home setting sound more appealing to you?

If you’re planning on a facility, at minimum, that can be hundreds of thousands of dollars to start. Then you have to fit the structure with ramps, wheelchair- and senior-friendly bathing facilities, adjustable beds, security measures, and adequate kitchen and dining facilities.

You have to pass a health inspection, as well as getting properly licensed both as a facility and a healthcare administrator, and hiring the medical and social service personnel to make sure your visitors receive excellent quality medical care while in your care.

In addition, you need to purchase lift assist and toileting assist devices and liability insurance, as well as providing refrigeration and secure storage for medications and training for staff in med passing, first aid, CPR, lifting, transporting and hygiene.

That doesn’t even include aesthetic measures to make your place comfortable and welcoming for residents and their families, and providing entertainment and stimulation during their stay.

Depending on the needs of your clients and the size of your operation, a startup could easily run up to half a million dollars or more.

Again, that’s the bad news.

The good news is that there are tons of grants out there to start an adult day care center.

Some grants you can explore:

  • Social Services Block Grant
  • Administration on Aging Grants
  • Robert Wood Johnson Foundation Grants
  • Department of Veterans Affairs Grants

Because starting an adult day care business is expensive, it’s important to keep costs down to save money where you can without cutting corners or sacrificing quality of care.

Some tips to keep costs down include:

  • Monitor utilities
  • Staff accordingly (labor is always your #1 cost)
  • Properly order supplies
  • Budget food properly so you aren’t wasting food by tossing out leftovers
  • Invest in re-washable and reusable rags instead of paper towels to clean messes

Examine every single cost, and be as detailed as possible in planning out your budget. The more successful you are in creating a budget, the more efficiently your business will fun.

Step 5: Decide Which Services to Offer

adult day care center business plan

Adult day services are so important because they can delay or even prevent a family from having to institutionalize a loved one in a skilled nursing home.

However, different facilities can offer different specialties.

For example, your facility may choose to specialize in clients with Alzheimer’s, or those with physical disabilities who may be wheelchair bound.

Your specializations can influence your facility.

If your day care focuses on those with wheelchairs, you may want to lower the height of all the counters, shelves, and tables in your facility to make everything in the building more accessible and comfortable to your clients. If you go with Alzheimer’s patients, then you may want to install doors which require a code to open and automatically close and lock so that patients can not simply wander off.

Perhaps, you can focus on a full daily calendar with entertainment for all your attendees. A high quality experience at your facility is sure to earn referrals and new customers. Or maybe yoga for seniors?

One service that you may want to offer is patient pickup/drop off. This requires an additional expense of a modified van to allow wheelchair access, as well as the cost of a driver and additional insurance. But such a service would almost guarantee customer loyalty and referrals.

By focusing on which services you offer or specialize in, you increase customer satisfaction in those areas and build a strong reputation for your service as an authority in the field.

Figure out what you can do better than anyone else, and focus on that. Maybe it’s you, maybe it’s your service, maybe it’s your experience. Figure it out, write it down, and make it your facility’s centerpiece, literally and figuratively.

Step 6: Decide on a Location

Where should you open an adult day care business?

That all depends on who your clients are.

Because you’re dealing with the elderly, you want a location which will be gentle to their bodies, so you’ll want to avoid areas that require a lot of walking or stairs.

All your decisions should cater to your clients. And because your clients’ bodies are not as strong as they once were, make it a point to locate your facility next to their homes. That doesn’t mean set up shop next door to your grandmother, but it does mean do some research on where there are aging baby boomer populations, and set up your adult day care service within those areas.

By making your location easy to get to from their homes, you are removing a major objection from your buyers (the children of the seniors), in that they may say “I don’t have time to get them there every day.”

Things to consider for an adult day care service include:

  • Local, state, and federal regulations – especially the Americans with Disabilities Act
  • Ability to evacuate everyone within easily
  • State of repair of the facility
  • Ease of finding the facility
  • Ease of pickup/dropoff
  • Cost – renting or buying

Running an adult day care service is a lot of work, but by selecting a great location, you make your job a little bit easier.

Step 7: Find Suppliers

adult day care center business plan

What equipment do you need to open an adult day care business?

Once again, the answer to that question depends on your business’s specialization.

Other than a proper facility, there are many things you will need when starting an adult day care service.

Some of these include:

  • Medical equipment and devices
  • Lift-assist equipment
  • Safety gear
  • Entertainment options
  • Therapeutic devices
  • Lift chairs
  • Tables and chairs
  • Commercial kitchen
  • Commercial laundry
  • Bio-hazardous waste disposal
  • Sheets and Blankets

These are the basic needs you’ll have when starting your facility. Make sure to do a thorough inventory of what you need by consulting your local state agency.

Once you know what you need, you need to know where to get your supplies.

A couple options to get you started are:

  • http://www.alimed.com/clinic-hospital-supplies-equipment/
  • http://www.quickmedical.com/medical-supplies.html

Step 8: Promote Your Adult Day Care Business

How do you promote an adult day care service?

This is a tricky question. It’s not as simple as promoting many common everyday businesses. However, the principle is the same – get in front of people who need your service.

For marketing and promotions, take advantage of Google Adwords to be featured in searches. Facebook is another powerful tool. Create a subtle ad directed at men and women over age 45 within a certain distance of your business.

But the most important marketing and promotion for your adult day care service is through networking. There is a strong and engaged support network for seniors. They need to know you exist.

Get involved with local groups such as:

  • Veterans Administration
  • Senior center providers
  • Meals on Wheels programs
  • Head trauma groups
  • State and local provider and consumer agencies, such as AAHSA, NADSA, and NADSA affiliates,
  • Local YMCAs and YWCAs
  • Friends, family members, and other service providers
  • Postal carriers and clergy are excellent networking people since they know so many others

Step 9: Create a Staffing Plan

Who works in an adult day care center?

It’s impossible for you to do everything on your own in this business. So it’s important to have a proper staffing plan.

You must understand how many employees you need, where you will find them, and what certifications they must possess in order to work in your facility.

Different positions will have different specifications. For example, an arts and crafts teacher may have different requirements than whoever oversees medications. When in doubt, always contact your local state agency for requirements and recommendations as to how many employees you need and what roles are required.

Once you’re clear on that, then you have to plan how and where to find them. Reach out to local agencies for suggestions, but hospitals and volunteer centers are a great starting point.

Also, look around at local colleges and universities with medical programs for help. You can find young, eager medical students who can help at a discounted rate for school credit. This is a great way to find qualified help and save money all in one move.

Your business can not survive without help, and to save time and money, you need to have a staffing plan for that help.

Step 10: Decide on a Style/Design

Deciding on a style is so important in the adult day care business because that style can either make customers feel welcome or scare them away.

Businesses which take seniors’ needs into account when designing their facilities are far better equipped to attract them as clients.. You want your facility to be warm and inviting, and make your guests feel at home.

Some suggestions for designing a style that appeals to seniors are:

  • Positive language (remember to take your medicine instead of don’t forget to take your medicine)
  • Big, clear font and text for any writing in the facility
  • Use bright colors
  • Give clear instructions where needed, using numbered lists
  • Avoid slang or acronyms

The best tool at your disposal for figuring out your design is the senior community in your area. Go talk to them and figure out what they like and do not like. After all, who knows what your clients will love better than your potential future clients?

If you need help with designs, visit 99designs . For as little as $99 you will have a collection of designers submitting their work and competing for you to select a winner who will receive your money as a prize.

It’s an inexpensive way to get a large selection of high quality work.

Struggling with what to name your adult day care business? Here are a few ideas:

Step 11: create an accounting plan.

adult day care center business plan

An accounting pan is critical for an adult day care business for several reasons.

As a service for a vulnerable demographic, you’ll be eligible for several grants. But to renew those grants, you’ll have to submit documentation proving your facility is running efficiently. You have to track all expenses down to the penny.

In addition, an accounting plan ensures you know exactly how much money is available for payroll, supplies, marketing, and improving your facility. Plus, you’ll be able to make sure nothing is missing from your facility.

And of course, when tax season rolls around, your business may come under a microscope because of your grants.

Make sure you’re prepared for all of that by having an accounting plan to ensure you stick to your budget.

Some options are:

  • A local accountant

Step 12: Get Into the Adult Day Care Services Community

adult day care center business plan

The adult day care services community is engaged and active. Seniors are vulnerable, and as such need a big support network. Your goal is to be as supportive as possible and learn as much as you can regarding new policies and procedures which can benefit your business and your clients.

And the best way to do that is to be active in the adult day care service community.

Focus on the same organizations mentioned within the marketing and promotions step, including:

Most importantly, make sure you’re a member of the National Adult Day Services Association .

Here’s a great infographic about starting an adult day care business:

The bottom line.

Opening (and running) an adult day care service is a lot of work.

But if you do it right, it’s not only rewarding, it’s a lot of fun.

You get to meet amazing people who’ve lived amazing lives and can teach you so much!

On top of that, you are literally saving lives and helping countless people.

Hopefully, you put this guide to use.

If this was helpful for you and you want to learn more about opening an adult day care business, StartupJungle.com has a 21 point checklist for starting your new business . Make sure you download this if you’re serious about getting started.

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7 Steps to Start an Adult Day Care

7 Steps to Start an Adult Day Care

How to open an adult day care center: the 7 c's checklist.

Now is a great time to open an Adult Day Care service. It is a growing market due to the aging population in the U.S. The cost of assisted living and skilled home care is simply not affordable for many Americans. Therefore, Adult Day services give families the option to care for and support their loved ones at home while also working full-time jobs, raising children, and caring for their own well-being too.

Adult Day Care facilities provide an important and ever-increasing need in aging and disabled communities. They offer family caregivers respite in addition to providing aging and disabled populations with social interaction, health services and advocacy, meals, transportation and a safe environment.

If you want to open an Adult Day Care service, here are steps you should take:

1. Consider Your Options

Acquire an existing adult day care center.

This is a fairly common option. There are obvious benefits to buying up an established business rather than starting from scratch. However, you will want to make sure you thoroughly research the center's business history and develop a promotion plan going forward. If it is the right choice for you, ensure work with a trusted business broker. Their expertise will help make the acquisition go smoothly. 

Open an Adult Day Care center franchise 

If you are a business rookie, franchising is an opportunity for you to consider. There are far fewer risks involved due to the stable foundation of an already established and successful brand. Furthermore, it is beneficial to have guidance and help from business owners when you’re a new entrepreneur.

There are multiple Adult Day Franchises on the market. We advise you to explore your different options - Our current recommendation is ActivAge who are rapidly expanding across the US.

Different Types of Adult Day Services

Adult day services is a system of professionally delivered, integrated, home- and community-based, therapeutic, social and health-related services provided to individuals to sustain living within the community.

It is important to distinguish the various types of Adult Day Care provision. Keep in mind, a facility may offer more than one of the following:

Adult Day Social Care : Provides meals, recreational activities, day trips, and social interaction. Clients do not have significant health issues or impairments. 

Adult Day Medical Care : In addition to social care offerings, Adult Day Healthcare providers usually have RNs and other therapeutic health practitioners on staff. They may offer physical, occupational and speech therapy. Clients are generally those requiring more medical care and would not be safely left at home alone.

Adult Day Skilled Care : This model provides specialized care to specific client populations. For instance, this could include adults living with developmental disabilities or those with dementia. 

2. Conduct Market Research ‍

Take a look at the US Census Data to see if there is a need in your community. For instance, look at how many people over the age of 65 are living in your area in addition to other key demographics.

Then, find out how many Adult Day Services are in your area . Next, visit or call them. This will help you determine what programs or areas of service are missing from what your community currently offers. It is important to set yourself apart from the competition and attempt to fill an unmet need.

3. Contact Your State Association Partner ‍

Each state has its own set of rules and regulations you will need to be aware of. Most states have Adult Day Service Associations you can contact to find out about state-specific licensures, accreditations and mandatory regulations. 

Additionally, the U.S. Department of Health & Human Services gives you access to state-specific rules and regulations in this document: Regulatory Review of Adult Day Services . From here, you should be able to...

4. Create a Checklist of What You Need to Do to Start Your Adult Day Service ‍

Once you know the rules and requirements for opening an Adult Day Care, you can start making a to-do list of action items. For example, some items might be to write a medication policy, apply for accreditation and license, apply for grants, purchase insurance, find a financial consultant, etc. This will help keep you organized and ensure you acquire everything you need to be set up for success.

5. Check Out Funding Options ‍

You may be wondering, “Where can I find investors to start an Adult Day Care?” 

See if your Adult Day Care business is eligible for Small Business Grants (SBA) or funding programs. Some other adult day care service funding opportunities to consider are: 

Social Services Block Grant (SSB)

This is a significant source of federal funding that states use to support adult day care communities. Contact your local state agency to find out if they allocate SSBC funding for adult day care.

Older Americans Act Funding (OAA)

OAA resources are available for senior centers and other community organizations to deliver services such as meals, transportation, information and referral, health promotion and disease prevention, and caregiver support.

Robert Wood Johnson Foundation Grants

These grants focus on expanding public policies, community-based programs, system changes and other interventions that are having a meaningful impact on health.

Alzheimer’s Foundation for America (AFA)

AFA provides various grants to member organizations offering support, services and education to individuals, families and caregivers affected by Alzheimer’s and dementia.

6. Communicate with Support Networks

If you’re starting an Adult Day Care, speak to someone who owns an Adult Day Care service outside of your area and ask them for advice. They won’t consider you to be a competitor. Consequently, they’ll be more open to answering industry-related questions and potentially mentoring you through the first steps. Also, become a member of the National Adult Day Services Association . NADSA is there to help you develop professionally. They host educational events, promote public policy, publish research and support providers with all kinds of resources and networking opportunities. You may also have a local state association which can help with state specific matters.

7. Compose an Adult Day Care Business Plan

Writing an effective business plan for your Adult Day Care service is crucial to success. You can find examples of Adult Day Care Business plans online to refer to for structure and content. This is where those support networks mentioned above can offer helpful guidance, too. 

Consult StoriiCare - FREE Digital Assessment & Cost Estimate

If you are writing a business plan or grant proposal for a new Adult Day Care, take advantage of StoriiCare. StoriiCare is a leading Adult Day Care Software provider. Their system is modern and easy-to-use. It enables care providers to digitally schedule clients and transport, create custom calendars, track service user participation, connect with families, run billing reports and so much more! 

StoriiCare offers a free digital assessment and cost estimate to include in your business proposal. Why include this or consider care management software? It shows investors that you:

  • Are forward-thinking . Digital care management is already on its way to being an industry standard. Including digital care management plans and costs in your business plans indicates that you’re future-proofing your care provision. 
  • Understand the market . Service users and their families are increasingly expecting a means of digital communication. Family caregivers are tech-savvy and StoriiCare enables you to keep caregivers up to date with digital signage, media, community announcements, private messaging, calendar sharing and more. Read about how care management software becomes a powerful communication tool during a pandemic .
  • Value the importance of data-driven decisions, measuring results and program evaluation . StoriiCare gathers robust data as you use it, generating in-depth trends and analytics reports. These reports can be used when applying for grants or other funding sources. 
  • Have a powerful marketing tool. StoriiCare is progressive and appealing to potential service users and their families. It can be used strategically in marketing efforts to differentiate yourself from other providers. 

Click here to book a call with a member of the StoriiCare team.

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Senior Daycare Business Plan Example

FEB.10, 2014

Senior Daycare Business Plan Example

Senior Daycare business plan for starting your own business

If you want to start a business where you can make money while being useful for the society, a senior daycare business can be a good option. In this business plan for senior day care center pdf, you will learn in detail how to open a senior day care center. The senior daycare business is a relatively new one and that means there is not a lot of competition in this field. All you need to do is do proper business plan development and you can make serious money in this niche. Many of the details of this business will closely resemble reiki practice business basics .

Executive Summary

2.1 the business.

Eastwood Senior Home will be a registered senior daycare service provider in Austin, Texas. If you ask what is a adult day care, the business will cater to the needs of the people who have to go to work and want their parents/loved ones taken care of. This senior day care business plan will look in detail how the business will be started and operated.

2.2 Management of Senior Daycare Business

It is very important to have a good management structure for starting a senior day care business with success so that we can make a good profit from it.  If you want to have a business plan for angel investors , management is the most important part.

Eastwood Senior Daycare will be managed by three managers. They will be look after the operations, public relations, and human resource of the business.

2.3 Customers of Senior Daycare Business

Unlike a pharmacy business plan , this business will serve a number of different customer types. It is necessary to decide which customers we will be serving in order to start and operate the business the right way.

  • People who want to leave their senior relatives at the daycare on a daily basis.
  • Seniors who want to move in for permanent care.
  • Seniors who are advised by doctors to not live alone.
  • People who are going on a trip/holiday and want to leave their senior relatives behind.

2.4 Business Target

Just like a retirement home business plan , this business has a target to improve the quality of life for senior citizens of the area. This target will be achieved by the following goals:

  • Building a trustworthy brand around the business.
  • Providing impeccable customer service.
  • Arranging the best-in-class services for the seniors we have to care for.
  • Keep improving and growing as a business.

Senior Daycare Business Plan Example - 3 Years Profit Forecast

Company Summary

3.1 company owner.

The owner of Eastwood Senior Daycare is Clint Eastwood. Clint has worked as a caregiver for seniors on a freelance basis for 10 years and then did a job in a day care center for seniors for another five years. He has the experience and expertise in this business and is just the right person to start this business.

3.2 Why the Senior Daycare Business is being started?

The reason Clint is starting this business is that he always wanted to do something for the society. He also wanted to start a business of his own. This business is a way that he can do something for the society while making good money. He also knows in detail how to start a senior day care business and can start and run this business effectively.

3.3 How the Senior Daycare Business will be started?

Step1: Planning

If you want to know how to start a daycare for adults, the first thing you need to know is the planning of the business. This is the part where you need to conduct a feasibility study and prepare the senior citizen day care center floor plans so that the business can be started.

Step2: Registration

The next thing that you need to do is to get the business registered. As this business will include attending to the very specific needs of people and providing them with medical attention if needed, it must be properly registered and insured. This step will closely resemble the one for non-emergency medical transportation business plan .

Step3: Establishing the Daycare Center    

Once the business has been registered, the next step will be to establish the facility. The facility will be designed and scaled according to the needs of the area where it is being made. The building will be small in the start but will be constructed in a way that it can be extended in the future if need be.

Step4: Marketing  

The next logical step of starting the business will be to make the business known to the people. Social, print and electronic media channels will be used to make sure that anyone needing the service in the area knows of the existence of the business.

Senior Daycare Business Plan Example - Startup Cost

Now, we have to decide the service that our adult day care service will be providing. As the field is quite a vast one, we can introduce different formats of an adult day care program so that everyone in the need of the service can find one that suits them the most. If you want to know how to start adult day care or how to start a day program for adults with disabilities, the services you will be providing need to be clear.

Eastwood Senior Daycare will provide the following services:

Basic Senior Daycare

This will be the standard daycare package for normal seniors who do not need any special care.

Daycare for Physically Challenged Seniors

This service will cater to the needs of the seniors who have physical limitations and can’t move around or do normal activities on their own.

Daycare for Mentally Challenged Seniors

The mentally challenged seniors affected by Alzheimer’s disease, or other such conditions will be taken care of by this service.

Long-Time Senior Care 

The families who want to leave their senior members with us for extended periods of time can avail this service.

Marketing Analysis of Senior Daycare Business

If you want to know how to open a senior daycare center, you’ll need to run a complete marketing analysis of the industry to see if the business can actually be feasible and profitable. Clint ran a marketing analysis of the business and found out that starting an adult daycare in the area can bring massive profits. This is because there is no such service provider in the area but there is a lot of demand for the service.

5.1 Market Trends

The next step in knowing how to open a senior daycare center is having a look at the market trends of the industry. It can be seen that the market is a relatively new one. People have just started opening an adult day care recently. It has also been pointed out that there is not even a single senior day care facility in the city. This makes the business a very lucrative one to start.

5.2 Marketing Segmentation

The customers of Eastwood Senior Daycare will be from the following market segments.

Senior Daycare Business Plan Example - Marketing Segmentation

5.2.1 Families of Seniors

Families who want their seniors taken care of will be one of the main market segments for the business.

5.2.2 Retired Seniors

Retired seniors who do not have anyone to take care of them will also be among the customers of the business, they will pay for their own care.

5.2.3 Hospitals

Hospitals that have more seniors than their staff can take care of will also be one of the main sources of income for the business.

5.2.4 Care Homes

Senior care homes who are under staffed to take care of all the seniors they have will also be served by the business.

5.3 Business Target

  • To become a well-reputed name in the business.
  • To make as much money as possible.
  • To provide the best adult daycare services in the area.
  • To get permanent customers for the business.

5.4 Product Pricing

Eastwood Senior Daycare will charge premium prices for the service. This is because no one is offering the services in the area and people need them. This gives the perfect opportunity to charge any price for the services.

Marketing Strategy

The next thing that is important for starting this adult day care manual is the marketing strategy of the business. It is necessary to get the adult day care license, without which we cannot provide these services. Clint knows in detail how to start a senior center because he has a complete marketing strategy for the business and all that remains is to execute it now. This business is closely related to a physical therapy business plan .

6.1 Competitive Analysis

The next step in knowing how to open an adult day care center is to run detailed competitive analysis of the business. Here is what’s discovered in the analysis:

  • It has been found that there is no business in the service providing this service.
  • The senior care service providers in the area do not provide daycare services. They are only for long-term care
  • There is a lot of demand for these services in the area and that means we can get a lot of business by starting this line of work.

6.2 Sales Strategy

One of the main benefits of adult day care business is that a simple sales strategy can work for it and unlike a business plan medical diagnostic centre , we don’t have to make a detailed one. Here’s the strategy for this business:

  • We will make the business known using all the advertisement channels in the area.
  • We will provide care packages suited for all types of customers the business is expected to have.
  • The business will offer discount to bulk buyers like hospitals and care homes.

6.3 Sales Monthly

Senior Daycare Business Plan Example - Sales Monthly

6.4 Sales Yearly

Senior Daycare Business Plan Example - Sales Yearly

6.5 Sales Forecast

Senior Daycare Business Plan Example - Unit Sales

Personnel plan

Like any business that is focused at providing services instead of products, senior day care business plan needs a lot of people to run the right way. This business plan for senior day care center pdf addresses this point in detail too. Here we will see what is the detail of the people that will be needed to run the business effectively. To answer the question how to start senior day care business, here is a plan of people needed to run this business.

7.1 Company Staff

The following people will be needed to run the business:

  • Clint Eastwood will be the owner and CEO of the business.
  • 3 managers to look after operations, public relations, and marketing.
  • 5 female caregivers.
  • 5 male caregivers.

7.2 Average Salary of Employees

Financial plan.

The last thing that we need to cover is the adult day care cost. This is a relatively low-cost business that can be started with a small investment. The elderly day care cost is low because we don’t need to buy an inventory or specialized equipment for this business. Here are the costs that will be involved in starting this business:

  • Cost of establishing the daycare facility.
  • Salaries of the staff.
  • Cost of an ambulance for the daycare.
  • Cost of a medical room.
  • Cost of registering and insuring the business.

8.1 Important Assumptions

8.2 break-even analysis.

Senior Daycare Business Plan Example - Break-even Analysis

8.3 Projected Profit and Loss

8.3.1 profit monthly.

Senior Daycare Business Plan Example - Profit Monthly

8.3.2 Profit Yearly

Senior Daycare Business Plan Example - Profit Yearly

8.3.3 Gross Margin Monthly

Senior Daycare Business Plan Example - Gross Margin Monthly

8.3.4 Gross Margin Yearly

Senior Daycare Business Plan Example - Gross Margin Yearly

8.4 Projected Cash Flow

Senior Daycare Business Plan Example - Projected Cash Flow

8.5 Projected Balance Sheet

8.6 business ratios.

Download Sample Business Plan for Senior Day Care Center in pdf

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Sample Elderly (Adult Daycare) Center Business Plan

Senior day care center business plan pdf sample.

The adult daycare business is one of the many easy businesses one could start without much financial difficulty. If you are naturally drawn to helping people, this may be a very good business to start.

This is one of the elderly care businesses, whose awareness has grown increasingly over the years.

If you are already set towards starting your own adult daycare business, then this article will be very useful as it contains an adult daycare business plan sample that can help you write your own business plan.

STARTING A GROUP HOME – PLANNING GUIDE

Here is a sample business plan for starting a senior home care business.

BUSINESS NAME:  Maximum Care Provision.

  • Executive Summary
  • Our Products and Services
  • Vision Statement
  • Mission Statement
  • Business Structure

Target Market

  • Sales and Marketing Strategy
  • Financial Plan

Sales Forecast

Maximum Care Provision is an adult daycare business that will be situated in New Jersey, United States.

It will be owned by Sharon Dempsey, who will also be the Chairman Executive Officer (CEO). Our focus will be on providing satisfying services to our clients, making sure we show them love and care.

Starting up our adult daycare business in New Jersey will require a total of $150,000 which will be contributed by both the owner and from the owner’s bank.

The owner has resolved to raise a total of $80,000 while the other part will be sourced from the owner’s bank.

Our goal is to become the first choice for residents in New Jersey, United States. We will do well to achieve our goals by making sure of accomplishing our set out objectives.

Maximum Care Provision is an adult daycare business that will be based in New Jersey, United States. We will make sure of making it our best in keeping our adult daycare center really conducive to our clients.

The following are the services which we have to offer to our clients:

  • Giving of care to sick adult clients
  • Assistance in making sure our elderly clients are very comfortable
  • Cleaning of elderly clients in cases where they are very weak and are unable to perform it by themselves

We have a vision for Maximum Care Provision, which is to build a very reputable adult daycare business that satisfies people of all sorts who are our clients.

We have a goal to become the top choice for clients in New Jersey, United States.

Our mission is to make sure to institute an adult daycare business that will fully love and cater to adults, and show our clients quality services that will put smiles on their faces.

It is very reasonable for every business to have a solid foundation upon which it is built. This is particularly true as every successful business is known to have a strong business structure as well.

We will make sure to build our business on a solid foundation. One of such ways is by making sure we hire employees who can comply with our requirements.

Also, they must be people who are very hardworking and who have experience in dealing with people, as regards showing care and love.

The following will make up the positions which will be filled by candidates who qualify through our recruitment process:

  • Chief Executive Officer (CEO)
  • Deputy Director
  • Cashiers / Accountants
  • Administrative Assistant
  • Supervisors

Here are the groups that make up our target market:

  • Businessmen and women
  • Corporate Executives
  • Households and families
  • Sportspeople
  • High-income earners and low-income earners
  • Government officials

Here are the steps we will take in promoting our adult daycare business in New Jersey:

  • We will begin by making sure we introduce our adult daycare business to residents in our location and far and wide using fliers and business brochures.
  • Our greeters will be strategically positioned to welcome our clients as they come in.
  • We will reach out to more clients using our ads on yellow pages.
  • We will make sure we create a partnership with health agencies whose interests are focused on adults.

Financial Plan Startup Capital

We will require $150,000 to start up Maximum Care Provision in New Jersey, United States. This startup capital will be sourced from both the owner, who is also the CEO, and also from the bank.

The owner has resolved to contribute a total of $80,000 while the other $70,000 will be sourced from the owner’s bank. This startup capital will include the first three months’ salary of our employees.

First Fiscal Year $100,000 Second Fiscal Year $220,000 Third Fiscal Year $400,000

Above is a simple adult daycare business plan sample bearing the business name, ‘Maximum Care Provision’.

This business will be particular about providing adequate love and care to its adult clients who need the services.

Maximum Care Provision will be owned by Sharon Dempsey.

SENIOR CARE SERVICE BUSINESS PLAN EXAMPLE

Business Name:  Topson Senior Care Services

TABLE OF CONTENT

  • Business Description
  • Market Analysis
  • Competitive Advantage

EXECUTIVE SUMMARY

A non-medical home care business helps in providing great services to people who need it and it is less technical.

This is a business that has continued to grow and gain popularity not only in the United States but in other parts of the world.

A non-medical home care business basically is a private residence for mostly the elderly, children, and young persons who cannot live with their families due to obvious reasons or those who have disabilities and cannot live alone.

The law states that for a home care business to be established, it must have at least six residents and a trained caregiver who will be present 24 hours a day and 7 days a week.

The residents mustn’t be people who need medical care because it is mainly for elderly people and those with a disability, people who need help in completing daily and simple tasks.

The home care industry is a large one and thrives well in developed countries such as Canada, the United States of America, Germany, the United Kingdom, Australia, Germany, and so on.

BUSINESS DESCRIPTION

Topson Senior Care is a well-licensed and registered home care startup business that is in its initial year of operation.

The business will be located in Duluth, Minnesota, and will provide home care services to residents who want to be taken care of in a facility.

A newly renovated and spacious housing facility has been secured in a good location which is already equipped with the required accommodation facilities.

Topson Senior Care is a business that passionately believes in success and financial excellence.

PRODUCTS AND SERVICES

In everything we do, we will ensure that our residents are satisfied, comfortable, and willing to recommend our business to others.

We are determined to provide excellent services such as:

  • Skilled nursing care
  • Personal hygiene
  • Personal support services such as taking medicines, bathing, etc.
  • Companionship
  • Nursing aide

VISION STATEMENT

Our vision is to become a one-stop home care facility in Minnesota and also to be among the top home care facilities in the United States of America.

MISSION STATEMENT

Our mission is to provide superior and quality services with competence and professionalism to our clients. We also aim to provide a comfortable and safe home for more than 10 residents.

BUSINESS STRUCTURE

In building standard home care, we have decided to employ only those who are qualified to work in the company, those who are professionals, hardworking, customer-centric, honest, and passionate to work in a home care facility.

They will be employed to occupy the following positions:

  • Chief executive officer
  • Trained caregiver
  • Nurse Aides
  • House manager/administrator
  • Rehabilitation counselors
  • Sales manager
  • Night manager
  • Medication management counselors
  • Weekend activity coordinator

MARKET ANALYSIS Market Trends

The industry was even able to grow in a bad economy due to the nature of the business.

The trend in the industry is that home care businesses are now adopting the use of technology in adjusting their services to attract more residents especially educated and knowledgeable residents.

Therefore, in making our business succeed we will be adopting the use of technology and also adapting to new markets.

Like we all know, our target markets are elderly people and those with disabilities.

SALES AND MARKETING STRATEGY

In making the business succeed in the industry, we will ensure that effective marketing and advertising are done.

Also to ensure that the business gets to the top, we have decided to do the following:

  • Offering resident-oriented and home model care than other home care facilities.
  • Being health-conscious and customer-centric at all levels of the business.
  • Making the facility a conspicuous edifice in the city of its location.
  • Being equipped with all the things that will make life comfortable for our residents.

FINANCIAL PLAN

The business has gotten 75% of the startup capital which is $150,000 and the remaining 25% will be gotten as a loan from banks and also from personal savings.

COMPETITIVE ADVANTAGE

We know that the industry is highly competitive and we have decided to stay atop the competition favorably by being devoted to the services we provide to our residents.

We will ensure that the residents are satisfied even beyond their expectations so that recommendations can come easily.

This is a senior care facility owned by Sarah Topson and is located in Duluth, Minnesota.

This business plan can be used as a guide to writing a senior care center business plan sample.

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Adult Day Care Center Business Plan

Adult Day Care Center Financial Model

The easy-to-use financial model allows you to control in real-time all aspects of the P&L, cash flow, and balance sheet. Please see video below!

1.0 Executive Summary

The purpose of this business plan is to raise and examine the allocation of $125,000 for the development of an adult day care facility that will be based in Concord, New Hampshire. Adult Day Care Center, LLC (“the Company”) will provide full-day care services for families that need ongoing assistance with the care of elderly adults and people with developmental disabilities. The Company was founded and is owned by Peter Smith. The location will be able to provide care for up to 30 people.

1.1 The Operations

As stated above, Adult Day Care Center, LLC will provide comprehensive care for people that cannot be alone during the course of the day. These individuals will typically live with family members. The facilities will feature televisions, card games, video games, and other forms of entertainment. Ongoing events will be held at the facilities as well.

One of the most important elements of the Company’s operations is that the location will provide ongoing entertainment and activities for its enrollees. The business will have transportation available for weekly travel events to area museums, parks, and other facilities.

The Company will charge $100 per day. Management, at all times, will strive to keep the fees affordable for families in the Concord market.

The third section of the business plan will further document the usage of funds.

1.2 Financing

At this time, Management is seeking $125,000 via a business loan in order to establish the operations of the Adult Day Care Center. The terms of this financing are to be determined during negotiation. However, this business plan assumes that the Company will receive a 10 year loan carrying an 8% interest rate. The funding will be primarily used for the following:

• Location development in Concord • Transportation vehicle • Working capital

Moving forward, the Company could easily acquire additional rounds of capital in order to further fuel the growth of the business. Management may develop additional locations using lines of credit or business expansion loans. This event is not expected to occur within the next three years.

1.3 Mission Statement

Adult Day Care Center’s mission is to provide an affordable solution among families within Concord that need ongoing day focused assistance for their loved ones.

1.4 Management Team

Peter Smith has more than four years of experience operating an adult day care facility. He will be able to quickly bring the operations of this enterprise to profitability while expanding bottom line income on a yearly basis.

1.5 Sales Forecasts

Adult Day Care Center P&L

1.6 Expansion Plan

After the third year of operation, Management may develop additional locations within New Hampshire. The Company may also acquire existing adult care facilities, which could be interested into the Company’s ecosystem.

2.0 Company and Financing Summary

2.1 Registered Name and Corporate Structure

Adult Day Care Center, LLC. The business is registered as a limited liability company in the State of New Hampshire.

2.2 Required Funds

Mr. Smith is seeking $125,000 in order to establish operations. He will contribute $25,000 towards the development of the Adult Day Care Center. The funds are to be used as follows:

Adult Day Care Center Startup Costs

2.3 Investor Equity

Peter Smith does not require an investor at this time. In the future, he may seek an equity partner as the Company expands.

2.4 Management Equity

Mr. Smith is currently the sole owner and member of Adult Day Care Center, LLC.

2.5 Exit Strategy

In the event that Management wishes to divest the business, a qualified business broker would be hired to manage the sale. Given the substantial economic stability of adult day care centers, the business could be sold for up to three times the previous year’s earnings. Mr. Smith has no intention of divesting the business for at least seven years.

3.0 Operations

As stated in the executive summary, Adult Day Care Center, LLC will provide a safe and secure environment for the needs of elderly people and people with developmental disabilities. The location will be able to provide care for up to 30 people on a daily basis.

In order to provide clients with an outstanding and engaging daily experience, the business will host events that focus on maintaining cognitive abilities while also providing entertainment. Multiple times per month, therapy animals will be brought to the location for the clients to engage with. The Company will arrange outings on a weekly basis that will include visits to parks, museums, lakes, and other areas of interest with a focus on natural environments.

The business will employ three staff members that will provide ongoing support for clients. As the Company expands, the Company will maintain a 10:1 client to employee ratio. An additional staff member will be hired to prepare meals and snacks.

4.0 Strategic and Market Analysis

4.1 Economic Outlook

This part of the business plan will focus on the current economic climate, the adult care industry, the competition, and the client profile.

At this time, the economy is doing reasonably well. Interest rates are returning to normalized levels while unemployment has remained very low. Inflation rates are declining, and the economy is poised for continued growth over the next three years.

However, any issues with the economy will have a negligible impact on the Company’s ability to remain profitable. The ongoing demand for adult day care services does not wane even during times of economic recession. The high gross margins generated will further contribute to the economic stability of the business.

4.2 Industry Analysis

There are currently 30,000 businesses that provide ongoing daycare focused services for elderly and developmentally disabled people. The industry generates in excess of $5 billion, and employs 138,000 people.

The growth of this industry is expected to remain strong in the coming years. As more people progress past the age of 65, the demand among families to have access to adult day care centers is expected to growth. At this time, approximately 18% of the population is over this year.

4.3 Customer Profile

Management will employ the following demographic profile when marketing the Company’s services to the Concord public:

• Annual household income of $75,000 to $125,000 • Will spend $500 per week on adult care services • Lives or works within five miles of the Company’s location in Concord

Management has specifically picked the Concord market given its population density and wealth. A full analysis of the target market that you plan on entering should be completed for your specific market. Most importantly, you will need to examine the number of potential clients in your market, median household income, and median home value (as an indicator of the general wealth of the market).

4.4 Competition

In this section of the business plan, you will need to examine the ongoing competition that you will face as you develop your adult day care center. A general market radius of 10 miles should be examined. Here, you will need to indicate the number of competitors, their pricing, number of clients, and how they market their services within the market. You should also list why your business has competitive advantages over other care centers.

5.0 Marketing Plan

In order to rapidly reach 100% occupancy for the adult day care center, the Company will employ a number of marketing strategies that will inform the Concord market of the business’ location. This will include a mixture of online-focused and direct outreach programs.

5.1 Marketing Objectives

• Develop referral relationships with geriatric focused physicians as well as medical professionals that provide services for developmentally disabled people. • Maintain an expansive online presence that uses both SEO and social media marketing specific for the Concord market. • Develop referral relationships among families that use the Company’s services.

5.2 Marketing Strategies

The Company’s website will showcase all aspects of the programs offered by the Adult Day Care Center. The platform will undergo local/regional search engine optimization specific for the Concord market. Management will have a number of videos created that showcase the facility and how clients interact with the center’s staff. The platform will be mobile friendly.

The Company will also acquire mailing lists that include the names and addresses of families that have indicated that they currently care for an elderly people in their home. These highly targeted mailed advertisements will be distributed within 10 miles of the Company’s location.

As it relates to social media, the Company will maintain profiles on Facebook, LinkedIn, and Instagram. Of special importance to the Adult Day Care Center’s operations is LinkedIn. Here, the Company will use advertisements that are specific to professionals that indicate that they work with older people or people with disabilities. This will further create new connections for referrals throughout the life of the business.

The Company will also maintain ongoing relationships with social workers, therapists, and related allied health professionals that frequently work with families that live with a person that may need adult day care services. Over the next three years, these ongoing relationships will ensure that the Company operates at or near 100% capacity at all times.

5.3 Pricing

The Company will charge $100 per day for its services.

6.0 Organizational Plan and Personnel Summary

6.1 Corporate Organization

Adult Day Care Center Corporate Organization

6.2 Payroll

Adult Day Care Center Payroll

6.3 Management Biographies

This section is optional. If you would like to include your professional background you should detail information about your education, experience in the adult day care center industry, and other related information.

7.0 Financial Plan

7.1 Underlying Assumptions

• Adult Day Care Center, LLC will acquire $125,000 to launch operations. • Peter Smith will contribute $25,000 towards the development of the business.

7.2 Sensitivity Analysis

Adult Day Care Center’s revenues are not sensitive to negative changes in the economy. Among families that need to provide round the clock support for an elderly or developmentally disabled people, this demand remains at all times. Th business will produce highly predictable revenue, which will further ensure profitability.

7.3 Source of Funds

Adult Day Care Center Source of Funds

7.4 Profit and Loss Statement

Adult Day Care Center Profit and Loss Statement

7.5 Cash Flow Analysis

Adult Day Care Center Cash Flow Analysis

7.6 Balance Sheet

Adult Day Care Center Balance Sheet

7.7 Breakeven Analysis

Adult Day Care Center Breakeven Analysis

7.8 Business Ratios

Adult Day Care Center Business Ratios

How to Write a Business Plan for a Daycare Center

Three young children sitting with a female teacher at a small table within a classroom.

Sholom Strick

13 min. read

Updated February 7, 2024

Free Download:  Sample Daycare Business Plan Templates

Working out a business plan for your daycare center can be a challenge. There are many expenses you must calculate—more than you’d think! Projected enrollment growth and market demand can also be tricky to estimate.

From knowing your competition to picking the right place to establish your daycare center, there are a lot of lessons to be learned. As someone who owns eight successful daycares in the Chicago area, I know the strategies and approaches that work when it comes to developing a sound business plan for a daycare center.

A business plan should look about three to five years into the future. It serves as a cornerstone of your vision as you move forward. You want to put a lot of thought and solid analysis into your daycare center business plan, because it will more than pay off in the end.

  • What makes your daycare center unique?

First of all, start with a description of your daycare center. You want to review all the different components of your business model. This description should basically be an elevator pitch for potential partners and business investors to get excited about what you’re offering and your unique location, philosophy, and approach.

What’s your curriculum based on? What criteria will you use in hiring staff? Write about the market and how you’re fulfilling demand. Write down particular statistics and characteristics of the neighborhood where you’ll locate your daycare center that make your center uniquely promising. Real estate sites like Loopnet and Zillow often provide helpful demographic analyses of neighborhoods; the most in-depth info is usually on commercial properties. For example, if the area around your future daycare center has 3,000 kids under five-years-old and only two daycare centers serving them, you’re in good shape.

In writing your company description, make sure to pay special attention to what sets you apart. Maybe it’s your prime location, your previous experience starting or helping start a daycare center, connections with top-notch staff willing to work for your daycare center, or other unique tools or services you can offer that distinguish you from your competition.

  • Do a focused market analysis

Next up is a market analysis . Study statistics of the childcare industry: how big is it? How much do economists and experts project that it will grow in the next five years?

How big is your target market?

For detailed information on the size of your primary market, there are helpful resources such as this market research guide from the US Small Business Administration .

Who is your target market ? Describe who you’re targeting. Using some of the information from real estate websites can be a good approach, like I mentioned above. For example, is the median age of your daycare center’s neighborhood quite young or more elderly? Are you in a bedroom community of a nearby city? Note down how your daycare is going to help these different kinds of parents.

Also, keep in mind other factors: Are you in an area with large amounts of seasonal work where the workforce and population shrinks during winter or grows massively during summer? Like it or not, this will likely affect your revenue and enrollment, especially if you are offering part-time care.

What’s your biggest business challenge right now?

  • What is your business model?

In addition to analyzing your market, note your pricing structure, gross margin levels, and other nuts and bolts of your business model. Will you offer discounts, or accept government-subsidized or reduced payments from lower-income parents? What employee childcare discount will you offer?

For detailed information on the size of your primary market, there are helpful resources, such as this guide from IBISWorld . This insightful article from Forbes is also a good resource, and notes that the U.S. Bureau of Labor Statistics expects daycare to be one of the fastest growing industries in the next few years.

  • Location and rental agreements

Pay special attention to the obvious: What is the square-foot-per-child requirement in your town, city, and state, and what is the price-per-square-foot of the daycare center you plan to lease? These two facts are absolutely key to putting together a solid business plan. You will generally need more square-feet-per-kid the younger they are (i.e. toddlers get more square feet than preschoolers).

Pro tip: things like the arc of a door’s inward swing and required sinks will eat up square footage, so take them into account. Always leave at least 10 percent breathing room when calculating required square footage for the classroom sizes you want.

Also, aim for using at least 60 percent to 80 percent of your daycare center on classroom size. Other square footage will be used for office space, hallways, required sinks, foyer, and so on, but you want to be using at least 60 percent for classrooms because that’s where you make your money.

Let’s use the example that you need 35-square-feet for every kid in a classroom up to a max classroom size of 20. That means you need a classroom of at least 700-square-feet (20 multiplied by 35). However, as I mentioned above, you want to leave breathing room of between 20 percent to 40 percent (for things like door swing radius, required baby changing tables, required sinks, future building modifications) so you should actually have a room that’s bigger than 700-square-feet.

In noting the lease information on your business plan, aim to negotiate free months of rent with your landlord. Opening a new daycare takes a long time for construction build-outs, permits, licensing and many other factors—sometimes up to a year. Explain this to the landlord. They want a tenant and commitment. Consider agreeing to a longer lease in return for a few months free or a landlord investment in build-outs.

Alternately, the landlord may agree to defer rent in return for a larger security deposit or added monthly payments. Asking for free months shows you’re a competent negotiator who takes his business seriously and has a long-term profit goal in mind.

Another thing to watch out for with monthly rent is all the added costs. Say your price is $20 per square-foot and your building is 5,000 square-feet. This adds up to $100,000. Divide that by 12 to get your monthly rent: $8,333. Make sure to find out if it is a gross or net rate.

Gross includes everything, but net doesn’t include the following:

  • Property taxes
  • Landlord insurance
  • Common area maintenance fees
  • Various other charges

Other questions to answer

How many kids are in your daycare center’s neighborhood and how many daycare centers already exist to serve them?

Take an average daycare center in a city that has, say, 100 kids enrolled. If you’re in a neighborhood that has 2,000 kids you still have room for a few daycare centers to serve demand, assuming around 10 percent to 20 percent of parents will enroll their kids in daycare.

There’s a pretty high demand for good childcare in the United States right now and many other countries. Whether you’re urban or rural the chances are you’ll be in demand—but you should still crunch the numbers before the contractors start working.

  • Who are your competitors?

How much market share do they have? What makes them strong and what are their weak points? Are there some more general impediments that could get in the way of flourishing, such as increasingly burdensome regulations in your state, or a lack of reasonably-priced leases to choose from?

There are a lot of regulatory requirements in the childcare industry (a lot!), so keep these all in mind when calculating the costs. There’s so much to keep track of!

Things to keep in mind:

  • Understanding your building’s zoning details
  • Organizing utilities and garbage pickup
  • Having the required playground
  • Cribs (for infant room)
  • Meeting daylight requirements in each classroom
  • Two points of exit from the center
  • Up-to-code kitchen with three-compartment sink and grease trap
  • Fire alarm system hooked up to a central box
  • Buzz-in security system
  • Parking requirements
  • Maintenance and repair fees

You’ll work with a daycare licensing representative from your town or city from the beginning of the process. They will help guide you through the regulatory process (you have to follow both city or town and state regulations), but it is still entirely your responsibility to keep track of all the costs that regulations and requirements.

  • Who will run your daycare center?

Next, you want to list organization and management of your daycare center. Who’s the director and assistant director? What are the details of your ownership structure, board of directors, investor list, partners, and so on?

Write down the responsibilities and roles of everyone on your team. List an advisory board if you have one, list all employee salaries, incentives, referral bonuses for recruiting, and all such details. Also in this part of your business plan, you want to be clear about the legal structure of your business in terms of incorporation, type of partnership (I recommend a passive partnership) and other such information.

All percentages of ownership, investor details, stock details, and so on should be listed. Profiles of staff, directors, investors, and board members should include everything from past track record to education and unique skills.

What’s your marketing plan?

Following your organizational details, you should describe your marketing plan. Budget-friendly marketing strategies are the name of the game here.

Reach your target market

There’s no one way to do this, but I recommend thinking specifically about who your customer base is and marketing accordingly. In my case, I had great success with a marketing campaign where I put ads on the baby seat of grocery carts at a grocery store close to my daycare center.

Be specific

Know your target audience and what they’re looking for, and then show them that you fill that need.

Your marketing strategy should look at how to explain the unique strengths of your daycare center, how you’re going to grow, what staff, if any, you’re going to hire in marketing roles, and what methods you will use, from online ads to brochures and billboards. Having a solid marketing plan will help you get clear on your sales strategy.

Have a plan for funding

Finding funding is another area you’ll want to pay attention to when you’re crafting your daycare center’s business plan.

A funding request should list:

  • How much you need now and in the coming three to five years
  • What the money will be used for
  • Any perks such as free months of rent you negotiated with a landlord that show the viability of your model
  • Future potential situations such as a buyout, selling the business, and so on

Your financial projections should include forecasted income, expected enrollment growth, balance sheets, cash flow statements and projected/needed capital expenditures.

Projected costs

Keep in mind that as enrollment goes up you will need more staff as well, in order to meet required student-to-teacher ratios. You’ll also need more food and supplies when you have more kids enrolled.

Financial projections need to factor in many things including:

  • Registration fees
  • Wait-list fees
  • Construction cost
  • Staff appreciation day costs
  • Software costs
  • Supply costs
  • Training costs
  • Utilities costs
  • Marketing costs
  • Bank service charges
  • Monthly nurse consultant costs
  • Interior daycare supplies from clocks to filing cabinets to computers
  • Accountant and legal costs

When you first start a daycare, you’re going to be in the red. It costs a lot to start a daycare, and it takes time to get going, as I mentioned. This is normal. You should see profits start kicking in after an initial period of six to 12 months of operation.

Capital costs

In terms of capital expenditures, the list is long, from monthly rent and utilities to staffing, construction, repair and supply costs as mentioned above. Digging deeper in these categories reveals even more items. Infants need everything from towels and cubbies to cribs and toys. Preschoolers need crayons, games, tiny chairs, craft supplies, and much more. List everything you can think of and then add more estimated cost.

For construction, you need to calculate the cost of:

  • HVAC systems and ductwork
  • Baseboards and finishing work
  • Interior doors
  • Buzzer system

Get a contractor and tradesperson or two to quote you on the job so you have an idea what it will cost. Don’t forget to factor in architectural fees and the cost of heating, electric, and utilities for the months the daycare is empty of students but contractors are working on it.

Securing loans

To get a bank loan for a new daycare center you’ll have to base a loan off the income of another business you own. That said, loans through the SBA can be standalone based on the viability of your business plan, so I recommend looking into them. If you buy a business, an SBA loan can also be a possibility.

For example, if you pay $500,000 for someone’s existing daycare and are required to put a typical 20 percent down ($100,000), you can cover the rest with an SBA loan. You’ll need to show a solid business plan and have good credit, but an SBA loan has the advantage of not drawing on your other sources of income as collateral.

Funding from investors

Another funding source, of course, is to drum up investors. Some people turn to family, friends, or colleagues. I would recommend keeping it strictly business and avoiding family or friends. If you do go this route, however, have a strong paper record to refer back to if this turn sour down the road.

Business partnerships

In finding a partner you want to ideally find someone who loves your plan but doesn’t have time or interest in being directly involved. This is called a passive partnership, where one partner supplies an investment and the other operates the business.

In terms of a repayment scheme, this will depend on your unique situation. For example, if an investor or investors give me cash up front for my financial projection that my daycare center will be making $200,000 per year after several years, I will repay 50/50, so one investor would get back $100,000 per year once the income target has been reached or if there are two investors they will get back one-third each, and so on.

After you address funding and costs in your business plan, add an appendix with supporting documentation. Keep this on hand for investors to look over.

Your appendix can include:

  • Credit history
  • Reference letters
  • Backup details and sources of your market analysis
  • Licenses and permits
  • Legal documents
  • Copies of lease agreements
  • Building permits
  • Utilities, maintenance, construction, plumbing, and other contracts
  • List of all individuals associated with your daycare such as accountants, lawyers, and consultants
  • Write your executive summary

Lastly, write down your executive summary . If you’re starting a daycare center, there’s only so much you can know before you have been in operation for multiple years. However, you can write down a lot about the purpose and strategy of your company, your own background and motivations for starting the daycare center, and your projections of future growth and customer needs.

At the end of the day, if you provide a great service and have a business plan methodically anticipates the needs of customers and kids, you will be a huge success in starting a daycare center!

  • Download your daycare sample business plan PDF

Get started right now by downloading  this  daycare center business plan PDF  for free. You can also view other daycare sample business plans , or visit Bplans’ gallery of more than  550 sample business plans  if you’re looking for more options.

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Content Author: Sholom Strick

Sholom Strick is a daycare owner and the CEO of Hopping In , a free, web-based app that lets parents earn money when their child is absent from daycare. Hopping In is an easy-to-use, innovative tool that makes it simple for parents to book vacant spots on short notice. He is passionate about developing innovative solutions to improve the childcare industry. You can contact him at [email protected].

adult day care center business plan

Table of Contents

  • What’s your marketing plan?
  • Have a plan for funding

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Adult Day Care Center Business Plan and SWOT Analysis

Adult Day Care Center Business Plan, Marketing Plan, How To Guide, and Funding Directory

The Adult Day Care Center Business Plan and Business Development toolkit features 18 different documents that you can use for capital raising or general business planning purposes. Our product line also features comprehensive information regarding to how to start an Adult Day Care Center business. All business planning packages come with easy-to-use instructions so that you can reduce the time needed to create a professional business plan and presentation.

Your Business Planning Package will be immediately emailed to you after you make your purchase.

Product Specifications (please see images below):

  • Bank/Investor Ready!
  • Complete Industry Research
  • 3 Year Excel Financial Model
  • Business Plan (26 to 30 pages)
  • Marketing Plan (24 to 28 pages)
  • 425+ Page Funding Directory
  • PowerPoint Presentation
  • Loan Amortization and ROI Tools
  • Three SWOT Analysis Templates
  • Easy to Use Instructions
  • All Documents Delivered in Word, Excel, and PowerPoint Format
  • Meets SBA Requirements

Senior citizens require some assistance during the day. These businesses have become popular with families that can afford to have their older ones close to them, but he supervision during the day. Additionally, adult day care centers have become popular as provides a social outlet for older adults to be with each other during the course of a day. These businesses do have moderate barriers to entry given the size of the facilities needed to provide the services. The general startup costs for new date adult daycare center generally range anywhere from $200,000-$1 million depending on the scope and scale of the facility. These the higher end of the development costs usually relate to acquiring real estate to provide these services to the general public. These businesses have experienced a surge of popularity over the past 15 years as more people from the baby boom generation reach their senior years.

Financial institutions, banks, lenders, and private investors are all very willing to provide the necessary startup capital for an adult daycare center. The highly predictable streams of high-margin revenue make this an attractive small business investment. Of course, any entrepreneur looking to enter this field is going to need to have a properly developed business plan. Within this document, a three-year profit and loss statement, cash flow analysis, balance sheet, breakeven analysis, and business ratio page should be developed in order to showcase to potential investor or lender that the adult daycare center can be economically viable at all times. In addition to the properly developed financial model and expansive discussion regarding the population base, population density, percentage of families caring for an older person, median household income, median family income, and competitor information should also be included in the business plan. A specific focus within the this document should be on how the adult daycare center will generate referrals among healthcare professionals and assisted-living facilities.

Once the business plan is done, it is time to develop the adult daycare center marketing plan. This document should focus heavily – again – on how referrals will be developed with physicians, nursing homes, assisted living facilities, and in-home healthcare agencies. Beyond referrals, it is imperative that a adult daycare center also maintain an expansive website that showcases the facilities, staff biographies, hours of operation, preliminary pricing information, hours of operation, and other relevant information so that caregivers can make an appropriate decision as to whether to provide the services for elderly people that they care for on an ongoing basis. A presence on social media is also important as many people that care for older parents and family members will frequently discuss these topics online. As such, maintaining pages on Facebook, Twitter, Google plus, and other relevant websites is important in order to be to reach as many people as possible.

An adult daycare center SWOT analysis should also be developed in order to determine the strengths, weaknesses, opportunities, and threats that are commonly associated with these types of businesses. As it relates the strengths, adult daycare center is generally immune from negative changes in the economy given that people that care for older individuals are going to need the services on a regular basis. For weaknesses, outside of any competitive issue there really no major weaknesses that impact the way that an adult daycare center has to conduct business. However, the operating and staffing costs are generally pretty high. For opportunities, many owner operators of adult daycare centers will seek to establish additional locations once their initial location has reached 100% capacity. For threats, there really no major threats that would impact the way that these companies are able to grow and expand over the next 5 to 10 years.

Adult Day Care: An Entrepreneur Business Model Presentation

Introduction.

Nurse practitioner entrepreneurship business model:

  • Concept Statement.
  • Marketing Plan.
  • Product Development.
  • Finance and Accounting.
  • Legal Considerations.

In this presentation, the details of an entrepreneurship business model for adult day care services will be discussed. A good business plan plays a crucial role in financing and preparing for various expected tasks. At the same time, it is a reliable road map for individuals to meet their organizational and managerial goals. There are five main elements in the plan, including:

  • The creation of a concept statement with the reasons and benefits of the chosen type of care and a business plan;
  • The organization of a marketing plan with target market penetration and the most effective strategy;
  • Product development with all possible risks;
  • Finance and Accounting implications with resources, funding, and expenses;
  • Legal considerations with a business team and the description of such issues as protocols and certifications.

Introduction

Adult Care Basics

  • Sustain people’s health, nutritional, and daily living needs.
  • Promote functional independence.
  • Improve the quality of life.
  • Support families with older adults.
  • Provide screening, physical therapies, and medication management.
  • Educate and consult.

Adult day care aims at sustaining people’s health, nutritional needs, and daily living standards. The main characteristic of this type of care is that it is offered out-of-home to enhance functional independence among adults and older people and improve the quality of life (Gaugler, 2014). The reasons why adults are in need of day care vary, including chronic conditions, traumas, or mental health disorders that limit their physical and thinking abilities. Adult care centers are created to support families with older or disabled adults by providing education, counseling, screening, and physical therapies (“Adult day care,” n.d.). Socialization and medication management are also included in the list of services.

Adult Care Basics

Concept Statement: Idea and Reasons

Idea: Professional health care to older adults and relief to family members

  • Companionship for older adults.
  • High-quality medical and healthcare management.
  • Education and communication.
  • Social and moral support.

A team of nurse practitioner entrepreneurs suggests developing an adult day care center the idea of which is to promote professional health care to older adults and enhance relief to their family members. The core goal is rather simple: to create an organization for adult people in need to meet their physiological and psychological needs. The reasons for selecting this area are closely connected to the general plan. Today, more than 12 million Americans are in need of long-term day care, and 63% are people under 65 years (Family Caregiver Alliance, 2015). Therefore, it is expected to offer credible help to this group of people and focus on companionship for older adults, management of health care and medication treatment, education, communication, and social or moral support for adults and their families.

Concept Statement: Idea and Reasons

Concept Statement: Benefits

  • Regular control of adults and their health;
  • Stress and anxiety reduction;
  • Improved quality of life;
  • Safety and comfort anytime;
  • Improvement of social and cognitive functions;
  • Independence and social interactions.

There are many benefits to prove the necessity of the adult day care center that directly influence patients, as well as their families and caregivers. On the one hand, families who have older adults need to spend much time controlling their health, mental or emotional changes, and medication intake. They have to sacrifice their jobs and freedoms to make sure their older relatives are fine. This center is a chance for families to share certain responsibilities with healthcare experts and ensure regular control of adults and their health, reduce stressful situations, and improve the quality of life (to work, entertain, and relax). On the other hand, many older adults want to have some guarantees from healthcare workers, and this center is the place where safety, comfort, functional improvement, independence, and social interactions are promoted.

Concept Statement: Benefits

Marketing Plan: Target Market

  • Older adults (65 years and more);
  • Families with older adults;
  • Therapists;
  • Psychologists.
  • Personal communication;
  • Home visits;
  • Observations;
  • Sales under specific conditions.

Adult care centers can be interesting to a variety of people who are aware of the needs of older people, want to contribute to the field of senior health, or investigate the methods of family health improvement. In this marketing plan, the target market includes:

  • Older adults: males and females older than 65 years should be interested in receiving the best care and staying independent from their families;
  • Families with older adults: family members and caregivers of any age can find these services helpful to fulfill their personal and professional life goals;
  • Healthcare providers (i.e., nurses, therapists, and psychologists): experienced and novice employees may find a new job within this center.

Penetration to this target market occurs in several ways:

  • Communication with potential customers to reveal opportunities;
  • Home visits to identify adults’ needs and expectations;
  • Observations to offer the necessary services;
  • Sales for first-month services to attract attention.

Marketing Plan: Target Market

Marketing Plan: Strategy

  • Brief but informative;
  • Within real settings;
  • Directly addressed to people;
  • Supported with visuals;
  • Calm background music.

A TV ad is chosen as the main marketing strategy to inform people about a new adult day care center in their region. Despite the fact that many non-TV options like Facebook, YouTube, or smartphone technologies are available to modern people, Americans still spend more than seven hours per day watching TV (Madrigal, 2018). Therefore, a TV-based approach seems to be relevant to connect with potential clients. The ad has to be short but informative, within real settings, and addresses directly the target population so older adults and their families may notice an offer. Interesting visuals and calm background music will be effective improvements within the ad.

Marketing Plan: Strategy

Development of the Service

  • A professional team of employees;
  • Credible stakeholders;
  • Operating licenses and insurance;
  • Successfully passed inspections;
  • Research and regular training.

The development of the service to be offered to older adults on a daily basis should begin with the choice of a professional team. Senior day caregiving includes social, recreational, and health-related activities that have to be provided by experts (Siegler, Lama, Knight, Laureano, & Reid, 2015). However, their help should be financially supported, and the search for credible stakeholders cannot be ignored. To meet national standards and legal considerations, appropriate licenses, insurance, and inspections must be obtained. The final stage of this service development is the promotion of sustainable research and training for the staff.

Development of the Service

Development Risks

  • Human resource problems;
  • Weak leadership;
  • Regional competitors;
  • The lack of customers;
  • Poorly calculated prices;
  • Inflation or financial markets’ changes.

There are three types of risks in service development: operational, strategic, and financial. Operational risks include the impossibility to predict all human resource problems like the hiring of the necessary number of people, cooperation, and the establishment of clear goals. Weak leadership is another pitfall that cannot be neglected if a person fails to unite the team and coordinate them properly. Strategic risks may occur because of the presence of regional competitors or the inability to find enough clients in a short period of time. Financial risks also play a crucial role: if prices are poorly calculated or inflation occurs, even the most professional healthcare providers cannot cope with unpredictable outcomes.

Development Risks

Finance & Accounting: Implications

  • $50 per day;
  • $1,000 per month (8 hours/5 days/1 week);
  • $12,000 per year;
  • transportation;

Nationwide statistics will be used to identify major financial expectations and implications in this business project. First, costs for adult care for patients should be calculated (“Adult day care costs,’ n.d.). It is expected for an individual to spend $50 on care per day, $1,000 per month, and $12,000 per year regarding five visits per week during 8 hours (without medication costs). Second, the costs of a center must be predicted in order to comprehend the number of stakeholders. $150,000 is required for the staff to take the initial steps and implement services, including food, facility, transportation, and HR costs within the first six months. If about 100 patients are found during the first year, certain incomes can be observed.

Finance & Accounting: Implications

Finance & Accounting: Resources

  • Personal funding.
  • Personal sponsorship.
  • Government sponsorship.
  • Crowdfunding.

To successfully create a business plan, several resources with financial support should be found:

  • Personal funding is usually planned beforehand and includes the contributions of the team to the project;
  • Personal sponsorship includes the possibility to find one investor and use his or her money for the project (nowadays, it is fashionable to become a volunteer sponsor)
  • Government sponsorship can be possible if all the papers, inspections, and licensed can be presented along with a plan of work and a safe financial history (an approval can take much time or be negative);
  • Banks give loans for people with good credit histories, but a number of peculiarities and expenses are included;
  • Crowdfunding is a modern method to raise capital on the basis of collective efforts of a team via social media.

Finance & Accounting: Resources

Finance & Accounting: Expenses

The financial section of the business plan is based on three statements – income, cash flow, and a balance sheet. Income statement turns out to be the initial step in analyzing the financial situation of the project. It should help to predict the expenses and profits of services and identify the income that can be expected.

Finance & Accounting: Expenses

Legal Considerations

  • The Medicare Adult Day Services Act of 2017.
  • The Health Insurance Portability and Accountability Act.
  • The Social Security Act.

From a general point of view, an adult day care business should meet the requirements of the three major laws applied to the American healthcare system:

  • The Medicare Adult Day Services Act of 2017 (the identification of services that have to be provided by older patients by licensed care facilities, including such food, transportation, and physical activities);
  • The Health Insurance Portability and Accountability Act (control and differentiation of healthcare information, as well as the protection of health insurance coverage for adult workers and their families);
  • The Social Security Act (a system of benefits for old-age people, including workers, unemployed adults, dependent mothers and children, and physically disabled patients).

Legal Considerations

Legal Business Details

  • Certification.
  • Other arrangements (contracts, programs, agreements, or provider manuals).

Legal considerations for the creation of an appropriate adult day care business cannot be ignored in this project. In the majority of states, it is expected for medical centers or similar facilities to have the staff who are licensed or certified. Licensure is required in 25 states of America, certification is an obligation in ten states, and four states expect healthcare experts have both, a license and a certification (“Section 1. Overview of adult day services regulations,” n.d.). In 13 states, including those where one standard has already been chosen, other forms of arrangement may be needed. Local regulations vary in the states, and it is better to contact a local governmental body and ask for all the necessary regulations and requirements.

Legal Business Details

  • Adult day care business helps older patients improve the quality of life and receive adequate care.
  • Families can relax and be confident that their relatives are under control and thorough examination.
  • As soon as a client database meets its limits, incomes can be observed.
  • Legal approval like license or certification is required.

There are many reasons for creating an adult day care center, but the most crucial ones are the intentions to help older patients improve their living standards and get access to high-quality health care on a regular basis. Families can benefit from such a center because it is a good opportunity to provide their adults with the best services and care when they are busy with their jobs, personal affairs, and other real-life demands. The offered marketing plan with its income statements and target market will work as soon as a legal approval in the form of licenses or certifications can be applied.

Conclusion

Adult day care . (n.d.). Web.

Adult day care costs . (n.d.). Web.

Family Caregiver Alliance. (2015). Selected long-term care statistics . Web.

Gaugler, J. E. (2014). The process of adult day service use. Geriatric Nursing, 35 (1), 47-54.

Madrigal, A. C. (2018). When did TV watching peak? The Atlantic. Web.

Section 1. Overview of adult day services regulations . (n.d.). Web.

Siegler, E. L., Lama, S. D., Knight, M. G., Laureano, E., & Reid, M. C. (2015). Community-based supports and services for older adults: A primer for clinicians . Journal of Geriatrics , 2015 . Web.

  • Chicago (A-D)
  • Chicago (N-B)

IvyPanda. (2022, June 10). Adult Day Care: An Entrepreneur Business Model. https://ivypanda.com/essays/adult-day-care-an-entrepreneur-business-model/

"Adult Day Care: An Entrepreneur Business Model." IvyPanda , 10 June 2022, ivypanda.com/essays/adult-day-care-an-entrepreneur-business-model/.

IvyPanda . (2022) 'Adult Day Care: An Entrepreneur Business Model'. 10 June.

IvyPanda . 2022. "Adult Day Care: An Entrepreneur Business Model." June 10, 2022. https://ivypanda.com/essays/adult-day-care-an-entrepreneur-business-model/.

1. IvyPanda . "Adult Day Care: An Entrepreneur Business Model." June 10, 2022. https://ivypanda.com/essays/adult-day-care-an-entrepreneur-business-model/.

Bibliography

IvyPanda . "Adult Day Care: An Entrepreneur Business Model." June 10, 2022. https://ivypanda.com/essays/adult-day-care-an-entrepreneur-business-model/.

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  • “How to Change the World” by D. Bornstein

Business Plan Templates

Adult Senior Daycare Business Plan

This is a free, printable business plan outlining the necessary services, organization and market strategies for new adult senior daycare owners and those working in the personal care service industry or nursing homes.

adult day care center business plan

Sample text from Adult Senior Daycare Business Plan:

1.0 Executive Summary

COMPANY NAME is a start-up nonprofit located in [CITY], [STATE]. The company is privately owned by INSERT NAME(S) who have extensive experience in the Personal Care Service industry, and have maintained excellent reputations in this same industry. The Company is situated in a group location, and the business space encompasses 2500 square feet.

COMPANY NAME is the Owners' other company, which is a successful for-profit company. COMPANY NAME is the spin-off non-profit company, which was created for the purpose of providing PCA services to people who cannot afford the services provided by COMPANY NAME, and people who don't have Medicaid and Medicare.

The Owners are seeking grant funding in the amount of $500,000. The money will be used to fund the community for services for Personal Care Attendants (PCAs) to enter into homes of clients who cannot afford the services. COMPANY NAME provides services to adult clients with handicaps/disabilities or who are developmentally challenged. Personal Care Attendants (PCAs) provide the following types of in-home assistance to clients:

• Bathing, grooming, and toileting

• Light housekeeping

• Meal preparation

• Shopping transportation

• Money management

• Companionship

• Social services

A grant or a series of grants, amounting to $500,000 is anticipated by COMPANY NAME in order to successfully execute its objectives. The funding will be used for additional staff, computer equipment, website design and marketing and will be allocated as follows:

Staff: $300,000 per year

Marketing: $15,000 per year

Manager salaries: $140,000 per year

Although COMPANY NAME has not started operation due to lack of funding, the company currently has a waiting list for clients in need of in-home care services. During the first year of operations the company looks to service a minimum of 100 clients per month at the rate of $15 per hour. Sales in this type of business are directly related to quality patient service and utmost satisfaction from referring physicians and health care facilities. It is perpetual business. One doesn't sell home health care; rather one sells excellent care, availability, and effective interpersonal relationships.

In a service industry, growth can mean loss of quality control, which in turn leads to client dissatisfaction. The services COMPANY NAME provides should always reflect the mission and oversight of management. The Owners want their clients to know that the quality of service they receive will be excellent, regardless of the individual service provider performing the service.

The Owners will therefore avoid the temptation to broaden the scope of COMPANY NAME's services too quickly. Rather, they will focus their immediate attention on making the services that are offered of the highest possible quality. Only when those services are well-established and grounded in excellence will the Owner's consider expanding the service base.

COMPANY NAME's Net Worth is expected to be ($39,992) in 2010, ($16,486) in 2011, and $310,898 in 2012, respectively.

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Daycare Business Plan Template

Written by Dave Lavinsky

Business Plan Outline

  • Daycare Business Plan Home
  • 1. Executive Summary
  • 2. Company Overview
  • 3. Industry Analysis
  • 4. Customer Analysis
  • 5. Competitive Analysis
  • 6. Marketing Plan
  • 7. Operations Plan
  • 8. Management Team
  • 9. Financial Plan

Daycare Business Plan

You’ve come to the right place to easily complete your daycare business plan.

We have helped over 100,000 entrepreneurs and business owners create business plans and many have used them to start or grow their daycares.

How To Write a Daycare Business Plan & Example

Below are links to each section of your daycare business plan template:

  • Executive Summary – This is a brief overview of your daycare business plan. The executive summary should be no more than 2 pages long, with brief summaries of other sections of the plan.
  • Company Overview – This is where you provide a business description, including your company history, business structure, and any pertinent information about the daycare center.
  • Industry Analysis – The industry analysis describes the daycare industry, including market size and trends.
  • Customer Analysis – This section of your daycare business plan describes your target market and potential customers. You will detail the demographics, needs, and wants of your target audience and how you plan to meet those needs.
  • Competitive Analysis – The competition in your local area will be described here, along with how your daycare business will compete in the market.
  • Marketing Plan – Your marketing plan will describe your daycare’s marketing strategy, including your advertising and promotion plans.
  • Operations Plan – This section of your business plan describes how your daycare will be operated on a day-to-day basis. It may also include your long-term plans for expansion and the milestones you want to achieve to get there.
  • Management Team – The management team section of your business plan should describe the experience and qualifications of your management team including the director, teachers, and support staff.
  • Financial Plan – The financial plan section of your daycare business plan should include your financial statements, such as your income statement, balance sheet, and cash flow statement.

Next Section: Executive Summary >

Daycare Business Plan FAQs

What is a daycare business plan.

A daycare business plan is a plan to start and/or grow your daycare business. Among other things, a good daycare business plan will outline your business concept, identify your target customers, present research about the child care industry, detail your marketing plan, and provide your financial plan.

You can  easily complete your daycare business plan using our Daycare Business Plan Template here .

What Are the Main Types of Daycare Businesses?

There are different types of daycare businesses that parents can choose from for their child's needs. A traditional daycare center is most sought after by working parents since it provides child care during regular work hours. There are also in-home daycare centers that are licensed to provide child care in a home setting with fewer children. Other child care centers provide hourly care services by trusted babysitters or nannies and are operating on an as-needed basis.

What Are the Main Sources of Revenues and Expenses for a Daycare Business?

The primary source of revenue for a daycare business is its child care services.

Some key expenses for a daycare business is rent, salaries for staff, utilities and snacks expenses for the children.

How Do You Get Funding for Your Day Care Business Plan?

A daycare or child care center is typically funded through small business loans, personal savings, credit card financing and/or angel investors. This is true for a business plan for daycare or a childcare business plan.

What are the Steps To Start a Daycare Business?

Starting a daycare can be an exciting endeavor. Having a clear roadmap of the steps to start a business will help you stay focused on your goals and get started faster.

1. Develop A Day Care Business Plan - The first step in starting a business is to create a detailed child care business plan that outlines all aspects of the venture. This should include market research on the childcare industry and potential target market size, information on the services you will offer, marketing strategy, pricing strategies and detailed financial projections.

2. Choose Your Legal Structure - It's important to select an appropriate legal entity for your daycare business. This could be a limited liability company (LLC), corporation, partnership, or sole proprietorship. Each type has its own benefits and drawbacks so it’s important to do research and choose wisely so that your daycare business is in compliance with local laws.

3. Register Your Daycare Business - Once you have chosen a legal structure, the next step is to register your daycare business with the government or state where you’re operating from. This includes obtaining licenses and permits as required by federal, state, and local laws. 

4. Identify Financing Options - It’s likely that you’ll need some capital to start your daycare business, so take some time to identify what financing options are available such as bank loans, investor funding, grants, or crowdfunding platforms. 

5. Choose a Location - Whether you plan on operating out of a physical location or not, you should always have an idea of where you’ll be based should it become necessary in the future as well as what kind of space would be suitable for your operations. 

6. Hire Employees - There are several ways to find qualified employees including job boards like LinkedIn or Indeed as well as hiring agencies if needed – depending on what type of employees you need it might also be more effective to reach out directly through networking events. 

7. Acquire Necessary Daycare Equipment & Supplies - In order to start your chlidcare business, you'll need to purchase all of the necessary equipment and supplies to run a successful operation. 

8. Market & Promote Your Business - Once you have all the necessary pieces in place, it’s time to start promoting and marketing your childcare   business. This includes creating a website, utilizing social media platforms like Facebook or Twitter, and having an effective Search Engine Optimization (SEO) strategy. You should also consider traditional marketing techniques such as radio or print advertising to reach your target audience.

Learn more about how to start a successful daycare business:

  • How to Start a Daycare Business

Where Can I Get a Daycare Business Plan Example PDF?

You can download our daycare business plan PDF template here. This is a business plan template you can use in PDF format.

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Sample Daycare Business Plan

Daycare Business Plan Template

Writing a business plan is a crucial step in starting a daycare. Not only does it provide structure and guidance for the future, but it also helps to create funding opportunities and attract potential investors. For aspiring daycare business owners, having access to a sample daycare business plan can be especially helpful in providing direction and gaining insight into how to draft their own daycare business plan.

Download our Ultimate Daycare Business Plan Template

Having a thorough business plan in place is critical for any successful daycare venture. It will serve as the foundation for your operations, setting out the goals and objectives that will help guide your decisions and actions. A well-written business plan can give you clarity on realistic financial projections and help you secure financing from lenders or investors. A daycare business plan example can be a great resource to draw upon when creating your own plan, making sure that all the key components are included in your document.

The daycare business plan sample below will give you an idea of what one should look like. It is not as comprehensive and successful in raising capital for your daycare as Growthink’s Ultimate Daycare Business Plan Template , but it can help you write a daycare business plan of your own.

Example – TinySteps Playhouse

Table of contents, executive summary, company overview, industry analysis, customer analysis, competitive analysis, marketing plan, operations plan, management team, financial plan.

At TinySteps Playhouse, we are committed to providing exceptional childcare services in the vibrant city of Denver, CO. Our daycare center is designed to offer a safe, educational, and nurturing environment for children ranging from infants to pre-kindergarteners. Our comprehensive curriculum is tailored to meet the developmental needs of each age group, fostering growth and learning through play. With a passionate and experienced team at the helm, TinySteps Playhouse is dedicated to supporting the families in our community by offering flexible care options that accommodate the diverse needs of modern families. Our location in Denver positions us perfectly to serve a growing demographic of parents seeking quality childcare solutions.

Our success at TinySteps Playhouse is anchored in our commitment to providing a nurturing environment that supports the holistic development of children. We have successfully established a reputation for quality care, thanks to our experienced and passionate team, comprehensive curriculum, and flexible childcare solutions. To date, we have achieved several milestones, including the successful launch of our center, consistent positive feedback from families, and a growing enrollment. Our dedication to fostering a supportive and engaging learning environment sets us apart and drives our continued success.

The childcare industry is witnessing significant growth, driven by increasing demand from working parents seeking reliable and quality daycare services. In Denver, CO, this trend is particularly pronounced, with a rising number of families requiring childcare solutions that offer both educational and emotional support. The industry’s expansion is further fueled by growing awareness of the importance of early childhood education, prompting parents to seek out establishments that provide more than just basic care. In response, daycare centers are evolving to offer comprehensive curriculums that encourage cognitive, social, and emotional development. This shift towards more holistic childcare services is reshaping the industry, making it an opportune time for TinySteps Playhouse to establish and expand its presence in Denver.

Our target customers at TinySteps Playhouse are working parents in Denver, CO, who value both the emotional and educational development of their children. These parents are looking for more than just a daycare; they seek a partner in nurturing their child’s growth. They are typically well-educated, middle to upper-middle-income earners who understand the importance of early childhood education and are willing to invest in quality childcare services. Our customer base values the flexible care options we provide, which cater to the diverse needs of modern families. By understanding and addressing the specific needs and preferences of this demographic, TinySteps Playhouse aims to become the go-to childcare solution in our community.

Top Competitors:

  • Happy Tots Daycare: Known for its large facility and wide range of extracurricular activities.
  • Little Scholars Childcare: Offers a strong educational program with certified teachers.
  • Sunshine Kids Academy: Praised for its outdoor play areas and emphasis on physical activity.

Our Competitive Advantages: TinySteps Playhouse stands out in the competitive landscape of Denver, CO, by offering a uniquely tailored curriculum that promotes holistic development. Our passionate and experienced team is dedicated to providing personalized attention to each child, ensuring their emotional, social, and educational needs are met. Furthermore, our flexible childcare solutions cater to the diverse needs of modern families, making us a preferred choice for parents in the area.

TinySteps Playhouse will implement a comprehensive promotional strategy to attract and retain customers in Denver, CO. Our approach includes a robust online marketing campaign leveraging social media platforms like Facebook, Instagram, and Twitter to connect with potential clients by sharing engaging content, testimonials, and educational tips. We will also employ SEO techniques and Google Ads to enhance our visibility online. Additionally, email marketing will keep us in direct contact with interested parents, sharing updates, events, and special promotions. Beyond digital efforts, we will engage in community outreach by partnering with local businesses and schools, sponsor events, and offer special promotions to establish ourselves as a trusted community member. Open houses and free trial days will allow parents and children to experience our daycare firsthand, building trust and demonstrating our high level of care. Word-of-mouth, encouraged through referral discounts, will further amplify our reach. Together, these strategies are designed to establish TinySteps Playhouse as the premier choice for daycare services in Denver.

Our operations at TinySteps Playhouse are centered around key processes that ensure the provision of high-quality childcare services. These include rigorous staff training, implementation of our comprehensive curriculum, and maintaining a safe and nurturing environment for the children. We have outlined several milestones to guide our growth, such as expanding our facility to accommodate more children, achieving specific enrollment goals, and obtaining additional certifications that reflect our commitment to excellence. These operational milestones are integral to our strategy for providing exceptional childcare and education services in Denver, CO.

The leadership at TinySteps Playhouse is comprised of individuals with extensive experience in early childhood education and business management. Our team includes a Director with over a decade of experience in childcare management, an Educational Coordinator who specializes in curriculum development, and a Business Manager skilled in operations and finance. Together, our management team brings a wealth of knowledge and passion for childcare, driving TinySteps Playhouse towards achieving its mission of providing outstanding childcare services in Denver, CO.

Welcome to TinySteps Playhouse, a new Day Care/Daycare that has recently opened its doors to serve our fellow residents in Denver, CO. As a local daycare center, we are acutely aware of the lack of high-quality daycare options within our community. With this in mind, we have stepped forward to fill this crucial gap, providing a nurturing and educational environment for the children in our care.

At TinySteps Playhouse, we offer a comprehensive range of services designed to meet the needs of busy families and their children. Our offerings include childcare, early education programs, nutritious meals and snacks, and ample opportunities for outdoor play and physical activities. We understand the importance of a balanced approach to child development, and our programs are crafted to foster growth, learning, and fun in a safe and welcoming environment.

Located in the heart of Denver, CO, TinySteps Playhouse is perfectly positioned to serve the local community. We are committed to becoming a cornerstone of support for Denver families, providing peace of mind to parents and caregivers while their children are in our care.

Our ability to succeed in this competitive market is grounded in several key factors. Firstly, our founder brings a wealth of experience from previously running a successful daycare, ensuring that TinySteps Playhouse is built on a foundation of proven practices and passion for child care. Additionally, we pride ourselves on offering superior childcare services compared to our competitors, supported by a team of highly experienced staff. This unique combination of experience, passion, and quality positions us to become the preferred choice for daycare services in Denver, CO.

Since our founding on January 5, 2024, as a S Corporation, we have achieved several significant milestones. We have developed our brand identity, including designing our logo and finalizing our company name, which resonates with our mission and values. Furthermore, we have secured an ideal location for our daycare, ensuring that we are accessible and convenient for the families we serve. These accomplishments serve as the foundation for our future growth and success, as we continue to build our reputation and expand our offerings to meet the needs of our community.

The Day Care/Daycare industry in the United States is a significant and growing market. Currently, the industry generates over $56 billion in revenue annually, with an average growth rate of 3.9% over the past five years. This indicates a strong demand for daycare services across the country, making it a lucrative industry for new businesses to enter.

One of the key trends in the Day Care/Daycare industry is the increasing number of working parents in the United States. With more parents entering the workforce, the demand for reliable and high-quality daycare services is on the rise. This trend bodes well for TinySteps Playhouse, as it positions itself to cater to the needs of busy families in Denver, CO. By offering convenient and flexible daycare options, TinySteps Playhouse is well-positioned to capitalize on this growing market.

Another trend in the Day Care/Daycare industry is the focus on early childhood education and development. Parents are increasingly looking for daycare providers that offer more than just basic childcare services, but also enriching educational experiences for their children. TinySteps Playhouse can differentiate itself in the market by emphasizing its educational curriculum and dedicated staff, attracting parents who prioritize their child’s learning and development. With the industry expected to continue growing in the coming years, TinySteps Playhouse has a promising future ahead.

Below is a description of our target customers and their core needs.

Target Customers

TinySteps Playhouse will target local residents primarily, focusing on families with young children in need of daycare services. The community within Denver has a significant portion of dual-income households where both parents work full-time jobs. This demographic is in dire need of reliable and nurturing childcare solutions, making them a primary customer segment for TinySteps Playhouse.

The daycare will also cater to single-parent families seeking a supportive and engaging environment for their children during work hours. Denver’s diverse population includes a notable number of single parents who require affordable, high-quality daycare services. By offering flexible hours and a curriculum that promotes early childhood development, TinySteps Playhouse will meet the specific needs of this customer group.

Moreover, TinySteps Playhouse will tailor its services to attract parents who prioritize educational content in their childcare selection. With an emphasis on learning and development, the daycare plans to integrate educational programs into its daily schedule. This approach will appeal to parents interested in providing their children with a head start in education, further broadening the daycare’s customer base.

Customer Needs

TinySteps Playhouse steps in to meet the critical need for high-quality daycare services that Denver parents desperately seek. Parents expect a safe, nurturing environment where their children can learn, play, and grow under the supervision of caring and professional staff. This establishment ensures that every child receives personalized attention, fostering a sense of belonging and security.

Moreover, TinySteps Playhouse recognizes the importance of convenience for working parents. It offers flexible hours to accommodate the varying schedules of Denver’s diverse workforce. By doing so, parents can maintain their professional responsibilities without compromising their child’s care and well-being.

In addition to basic caregiving, TinySteps Playhouse provides an educational curriculum designed to stimulate young minds and prepare them for future academic success. Parents can rest assured that their children are not only cared for but also engaged in meaningful learning activities. This comprehensive approach to daycare fulfills a critical need for developmental support beyond mere supervision.

TinySteps Playhouse’s competitors include the following companies:

Kiddie Academy of Denver-Boulevard One offers a comprehensive child care program that focuses on early childhood education and development. Their services include infant care, toddler care, preschool, and pre-kindergarten programs. The academy emphasizes a Life Essentials® curriculum, which supports the physical, emotional, intellectual, and social development of children. Price points vary based on the program and age of the child, but they generally fall within the mid to high range of daycare services in the Denver area. Kiddie Academy of Denver-Boulevard One operates primarily in the Boulevard One neighborhood of Denver, catering to families residing in or near this area. They target middle to upper-middle-class families looking for a blend of education and care for their children. A key strength of Kiddie Academy is its national reputation and standardized curriculum. However, its location-specific weakness may be its higher price point, which could be a barrier for some families.

Crestmoor Learning Center provides early childhood education with a focus on creating a nurturing and safe environment for children to learn and grow. Services include infant care, preschool programs, and after-school care for older children. The center adopts a personalized approach to learning, tailoring activities to the developmental needs of each child. Pricing information is typically customized based on the specific needs and schedule of the family, aligning with industry standards in the Denver area. Serving the Crestmoor neighborhood and surrounding areas, Crestmoor Learning Center appeals to families seeking a more intimate and personalized daycare experience. The center’s strengths lie in its community-focused approach and flexible scheduling options. However, its smaller size and limited capacity could be viewed as a weakness, potentially limiting availability for new enrollments.

The Learning Experience – Westminster operates in the broader Denver metro area, with a specific focus on the Westminster location. This center offers educational childcare programs for children ages six weeks to six years, including toddler care, preschool, and kindergarten prep. Their proprietary L.E.A.P. (Learning Experience Academic Program) curriculum is designed to promote cognitive, social, and physical development. While The Learning Experience – Westminster has a competitive pricing structure that aims to be accessible to a wide range of families, they also offer premium features such as a mobile app for parents. This center serves a diverse customer base, including families from various socioeconomic backgrounds. Their key strength is the blend of affordability and technology-enhanced services. A potential weakness is the reliance on a franchise model, which may result in variability in service quality across locations.

Competitive Advantages

At TinySteps Playhouse, we pride ourselves on offering superior child care services that set us apart from our competitors. Our commitment to providing a nurturing and educational environment ensures that every child in our care receives the attention and support they need to grow and thrive. We understand the importance of early childhood development, and our programs are designed to stimulate learning and creativity in a safe and welcoming setting. Our approach is not just about watching over children; it’s about engaging them in activities that promote their social, emotional, and intellectual development.

Another significant competitive advantage we have is our team of highly experienced staff. Each member of our team brings a wealth of knowledge and expertise in child care, early childhood education, and child psychology. This experience allows us to create a supportive and enriching environment for the children we serve. Our staff’s dedication to continuous learning and improvement means that we are always at the forefront of best practices in child care. Parents can trust that their children are in capable and caring hands, receiving the best possible care and education. This level of service and expertise distinguishes us in the Denver area, making us a preferred choice for discerning parents.

Our marketing plan, included below, details our products/services, pricing and promotions plan.

Products and Services

TinySteps Playhouse offers a comprehensive suite of services designed to meet the needs of busy families while providing a nurturing and educational environment for children. At the core of its offerings is Childcare, a service that ensures children are cared for in a safe, engaging, and supportive setting. Parents can expect to pay an average of $250 per week for full-time childcare, which includes a range of activities aimed at promoting the physical, emotional, and cognitive development of children.

Understanding the importance of early education, TinySteps Playhouse provides Early Education Programs tailored to different age groups. These programs are designed to lay a strong foundation for lifelong learning by incorporating elements of play, discovery, and structured learning. The cost of these programs is included in the weekly childcare fee, ensuring that every child has access to quality early education without additional financial burden on the families.

Nutrition plays a crucial role in the development and well-being of children, which is why TinySteps Playhouse offers Nutritious Meals and Snacks as part of its services. These meals and snacks are prepared with children’s dietary needs in mind, ensuring they receive balanced and healthy food throughout the day. This service is also included in the weekly fee, providing peace of mind to parents that their children are not only cared for but also receive proper nutrition.

Recognizing the importance of physical activity in children’s growth, TinySteps Playhouse incorporates Outdoor Play and Physical Activities into its daily schedule. This ensures that children have ample opportunity to engage in physical exercise, enjoy fresh air, and develop their motor skills. Like the other services, this is included in the overall childcare fee, offering a comprehensive approach to child development and care.

In summary, TinySteps Playhouse stands out by offering an all-inclusive package that covers childcare, early education, nutritious meals, and physical activities. With a focus on holistic development and a commitment to providing high-quality services, TinySteps Playhouse is positioned as a premier choice for families seeking the best care and education for their children in Denver, CO.

Promotions Plan

TinySteps Playhouse will utilize a comprehensive promotional strategy to attract customers in Denver, CO. At the heart of this strategy lies a robust online marketing campaign. The daycare will leverage social media platforms, such as Facebook, Instagram, and Twitter, to connect with potential clients. Through these channels, TinySteps Playhouse will share engaging content, including day-to-day activities, testimonials from satisfied parents, and educational tips for children. This approach not only builds a community around the daycare but also showcases the quality and care provided. Furthermore, the daycare will implement search engine optimization (SEO) techniques to improve its visibility in search engine results. By targeting keywords related to daycare services in Denver, TinySteps Playhouse will attract parents actively searching for childcare options. Additionally, the daycare will use Google Ads to reach a wider audience, ensuring that parents searching for daycare services in the area encounter TinySteps Playhouse at the top of their search results. Email marketing will also play a crucial role in the promotional strategy. TinySteps Playhouse will collect email addresses from interested parents through its website and social media channels. The daycare will then send out regular newsletters featuring updates, events, and special promotions. This direct line of communication will keep TinySteps Playhouse top-of-mind for parents considering daycare options. Beyond online marketing, TinySteps Playhouse will engage in community outreach. The daycare will collaborate with local businesses and schools to sponsor events and offer special promotions. These partnerships will not only increase visibility but also establish TinySteps Playhouse as a trusted community member invested in the well-being of local families. To further attract customers, TinySteps Playhouse will host open houses and free trial days. These events will allow parents and children to experience the daycare firsthand, meet the staff, and see the facilities. Such experiences are invaluable in building trust and demonstrating the high level of care and education that TinySteps Playhouse provides. Word-of-mouth will also be a vital component of the promotional strategy. Satisfied parents are the best advocates for TinySteps Playhouse. The daycare will encourage referrals by offering discounts or special offers to families that bring new clients. This approach not only rewards current customers but also harnesses the power of personal recommendations. In conclusion, TinySteps Playhouse will deploy a multifaceted promotional strategy to attract customers. By combining online marketing, community outreach, and word-of-mouth, the daycare will establish a strong presence in Denver, CO. These efforts will ensure that TinySteps Playhouse becomes a preferred choice for parents seeking quality daycare services.

Our Operations Plan details:

  • The key day-to-day processes that our business performs to serve our customers
  • The key business milestones that our company expects to accomplish as we grow

Key Operational Processes

To ensure the success of TinySteps Playhouse, there are several key day-to-day operational processes that we will perform.

  • Opening Procedures: Staff arrive early to prepare the facility, ensuring that play areas are clean and safe, and that all necessary materials for the day’s activities are ready and accessible.
  • Health and Safety Checks: Conduct daily health checks of all children upon arrival to monitor for any signs of illness, and ensure that all play equipment and toys are sanitized and in good condition.
  • Attendance Tracking: Accurately record the arrival and departure times of children to maintain an up-to-date attendance log for safety and billing purposes.
  • Meal and Snack Preparation: Prepare and serve nutritious meals and snacks at scheduled times throughout the day, adhering to any dietary restrictions or allergies.
  • Educational Program Implementation: Execute planned educational activities and programs that stimulate cognitive, social, and physical development, adjusting as necessary to meet the needs of different age groups and individual children.
  • Continuous Supervision: Maintain constant supervision of children to ensure their safety and well-being, intervening as necessary to guide behavior and facilitate positive interactions among peers.
  • Communication with Parents: Provide regular updates to parents about their child’s day, including any notable achievements, behavior observations, and any incidents or accidents that occurred.
  • Cleaning and Maintenance: Perform regular cleaning of the facility throughout the day, with a deep clean at the end of the day, to maintain a hygienic environment. This includes laundering of any used fabrics and sanitizing toys and equipment.
  • Staff Coordination: Conduct briefings with staff at the start and end of each day to ensure everyone is informed about the day’s schedule, any special needs of children, and to discuss any issues that may have arisen.
  • Financial Management: Process payments from parents, manage billing inquiries, and ensure accurate financial records are kept for accounting purposes.
  • Professional Development: Encourage staff to engage in ongoing professional development and training opportunities to stay current with best practices in early childhood education and care.
  • Emergency Preparedness: Ensure that all staff are trained in emergency procedures and that emergency contacts for each child are readily accessible. Conduct regular drills for different types of emergencies.

TinySteps Playhouse expects to complete the following milestones in the coming months in order to ensure its success:

  • Securing a Suitable Location : Find and lease or purchase a facility in Denver, CO, that is safe, accessible, and compliant with state and local regulations for childcare services. This location should also offer potential for growth and expansion.
  • Obtaining Licenses and Permits : Complete all necessary state and local licensing requirements for operating a daycare. This includes passing health and safety inspections and obtaining a childcare license.
  • Building and Equipping the Facility : Renovate and equip the facility to meet the needs of children of various ages, including purchasing educational toys, furniture, outdoor play equipment, and safety features. Ensure that the environment is inviting, stimulating, and secure for children.
  • Hiring and Training Staff : Recruit, hire, and train qualified childcare providers who are passionate about child development. Staff training should focus on health and safety protocols, educational strategies, and emergency procedures to ensure a high-quality care environment.
  • Developing Curriculum and Activities : Design a comprehensive, age-appropriate curriculum that promotes physical, emotional, social, and cognitive development. Plan a variety of engaging activities and routines that cater to the interests and needs of children.
  • Launching Marketing and Enrollment Campaigns : Implement targeted marketing strategies to attract parents and guardians in Denver, CO. Develop an attractive website, engage in social media marketing, and host open house events to facilitate enrollment.
  • Launching Our Daycare : Officially open TinySteps Playhouse for business, welcoming children and their families. Ensure a smooth operation from the first day, with staff ready to provide high-quality care and education.
  • Monitoring and Improving Quality : Establish mechanisms for regular feedback from parents and staff to continuously monitor and improve the quality of care and education provided. Implement changes as necessary to meet the evolving needs of children and families.
  • Reaching $15,000/Month in Revenue : Through effective marketing, quality service, and word-of-mouth referrals, steadily increase enrollment to reach the milestone of $15,000 in monthly revenue. This financial stability is crucial for covering operating costs and planning for future growth.
  • Evaluating Expansion Opportunities : After establishing a successful operation in Denver, CO, assess the feasibility of expanding TinySteps Playhouse to additional locations or offering new services to meet the needs of the community and drive further growth.

TinySteps Playhouse management team, which includes the following members, has the experience and expertise to successfully execute on our business plan:

Mason Clark, President

Mason Clark, President, brings a wealth of experience and a proven track record of success to TinySteps Playhouse. With a strong background in early childhood education and management, Mason has previously steered a daycare center towards operational excellence and growth. His expertise lies in strategic planning, staff leadership, and implementing innovative programs that enhance the learning and development of young children. Mason’s ability to drive business success, coupled with his passion for creating nurturing and educational environments for children, positions him as a key asset in guiding TinySteps Playhouse towards achieving lasting success.

TinySteps Playhouse requires significant funding to reach our growth goals and fulfill our mission of providing top-tier childcare services in Denver, CO. Our financial plan outlines the need for investment in facility expansion, curriculum development, marketing efforts, and operational enhancements to support our increasing enrollment and ensure the highest level of care. By securing the necessary funding, we will be able to implement our strategic plan, achieve our operational milestones, and continue to serve the families in our community with excellence.

Financial Statements

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Income Statement

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Cash Flow Statement

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