Running a before-school care program means juggling staffing, facility overhead, insurance, and program costs—all before 9 a.m. Understanding where your budget actually goes helps you price services competitively, manage margins, and scale without bleeding money.
Labor: Your Largest Expense
Staffing typically consumes 50–65% of your operating budget. Most states require one adult per 6–10 children depending on age, so your headcount is non-negotiable.
What to budget:
- Lead teacher or program director: $28,000–$42,000 annually (varies by region and credentials)
- Assistant staff: $20,000–$28,000 annually
- Substitute coverage: Budget 10–15% extra for sick days and turnover
Don't underestimate payroll taxes, workers' compensation insurance, and benefits. Add 25–35% on top of base salaries for these mandatory costs. If you're open 5 days a week, year-round (minus holidays), calculate hourly rates backward from your target per-child fees to confirm the math works.
Facility and Overhead
Space costs depend heavily on location and whether you own, rent, or operate within an existing school building.
Monthly fixed costs to model:
- Rent or mortgage: $1,500–$5,000+ (depends on square footage and region)
- Utilities (heating, cooling, water): $200–$500
- Internet and phone: $50–$150
- Insurance (liability + property): $150–$400
If you're partnering with a public school, you may negotiate a lower rent or utility split. If you're standalone, negotiate longer lease terms to lock in rates and build equity in the relationship with landlords.
Supplies, Materials, and Activities
Parents expect engaging, age-appropriate programming. Budget realistically for snacks, art supplies, outdoor equipment, and seasonal activities.
- Daily snacks and beverages: $2–$4 per child per day
- Classroom supplies (crayons, paper, glue, etc.): $400–$800 annually
- Outdoor equipment and playground maintenance: $500–$1,500 annually
- Books, puzzles, and educational toys: $300–$700 annually
Many owners source bulk supplies through Amazon Business or local wholesalers to reduce per-unit costs. Rotate toys and materials seasonally to maximize perceived value without constant replacement spending.
Licensing, Compliance, and Insurance
Non-negotiable costs that vary by state:
- Licensing fees: $100–$500 annually
- Background checks and fingerprinting: $50–$200 per staff member
- CPR/First Aid certification renewals: $30–$100 per person annually
- Liability insurance: $150–$400 monthly (covered partially above, but confirm)
- Director's credential or coursework (if required): $500–$2,000 annually
Check your state's childcare licensing agency for exact requirements. Some states mandate specific staff-to-child ratios or director qualifications that directly affect your staffing budget.
Technology and Administrative Tools
You need systems to manage enrollment, billing, parent communication, and staff scheduling.
- Enrollment and billing software: $50–$150 monthly
- Parent communication app (like Brightwheel or similar): $20–$80 monthly
- Scheduling tool or payroll software: $30–$100 monthly
- Email and basic office software: $20–$50 monthly
Total tech stack: roughly $120–$380 monthly. These tools reduce admin overhead and improve parent satisfaction, so they're worth the investment.
Sample Monthly Budget (20-Child Program)
| Category | Monthly Cost | |---|---| | Payroll (3 staff) | $5,500–$6,500 | | Facility (rent, utilities) | $1,800–$2,200 | | Supplies and activities | $300–$450 | | Insurance and licensing | $300–$400 | | Technology and admin | $150–$250 | | Total | $8,050–$9,800 |
At $350–$450 per child per month, a 20-child program generates $7,000–$9,000 in revenue. Margins are tight—you need full or near-full enrollment to stay profitable.
Growing Revenue Without Cutting Quality
Listing your program on Mercoly helps you reach parents in your service area, showcase your staff credentials and activities, and accept payments directly—all of which reduces customer acquisition costs and simplifies cash flow.
Upsell add-on services: late-pickup fees ($15–$25), extended care hours, summer camps, or specialized programming (STEM, sports, language) at premium rates. These incremental services improve margins without proportional overhead increases.
Frequently Asked Questions
Q: How much should I charge per child per month? A: Most markets support $300–$500 per month depending on location, staff qualifications, and program quality. Calculate your fixed costs, divide by expected enrollment, and add 20–30% margin. Adjust based on competitor pricing and parent income levels in your area.
Q: Do I need to be licensed, or can I run informally? A: Most states require licensing if you care for more than 4–6 unrelated children. Unlicensed care exposes you to legal liability and limits your ability to accept subsidy vouchers or grow. Check your state's childcare licensing office.
Q: What's the best way to reduce staff turnover? A: Offer competitive wages (survey local childcare salaries), provide professional development stipends, create clear advancement paths, and foster a positive team culture. Turnover costs 50–200% of a staff member's annual salary in recruitment and training.
Get your program in front of families actively searching for before-school care—start with Mercoly.