Why Do Daycares Use Waitlists Instead of Raising Prices to Meet The Demand?

[Ariana]

I will say though that the market might end up levelling itself out. As childcare becomes more lucrative more people will get into it and since you don’t need any real education or skills to do it (at least where I am) there is no deterrent to pursuing it, thus increasing supply and bringing down prices.

[Blackcat31]

Yes and only those who can afford a brand new IPhone buy one. It is the law of supply and demand. So if you are in high demand, raise your prices more. That is how supply and demand works. It’s why gas prices go up and down depending on circumstances.

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

I understand how supply and demand works.

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

S/D doesn't always apply to the child care business.
Theory is great but reality is more important.

[Annalee]

Yes and only those who can afford a brand new IPhone buy one. It is the law of supply and demand. So if you are in high demand, raise your prices more. That is how supply and demand works. It’s why gas prices go up and down depending on circumstances.

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

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

As for education, I do have an AS degree, but business sense doesn't always come from a college. Life lessons with hard knocks along with a special mentor taught me alot!

[Ariana]

I understand how supply and demand works.

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

S/D doesn't always apply to the child care business.
Theory is great but reality is more important.

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

I had a mom interview and tell me my rates were too high for their budget. I said ok and sent them on their way. A week later she contacted me....they magically found the money. Why? Because the supply of quality care is low.

[hwichlaz]

No idea why! No idea why some providers insist on offering services for WELL below market value either, thus keeping rates low...or why providers don’t unionize, band together and increase pay and working conditions. My guess and I do not mean for this to sound offensive is that most providers are only in it for the short term and have low education/know very little about business.

I charge average rates, and I do NOT want to unionize. Being self employed means making my own rules and setting my own rates...a union would only hurt, not help that.

[Unregistered]

The truth? Most of the providers here are legally unlicensed and don't have more than CDAs. They also don't want to do school prep. Who is going to pay high prices for that?

Many are also rude to parents and want (usually low paying) parents they can term left and right when they feel like pulling a hissy fit.

[LostMyMarbles]

Thanks! I was curious. Here it seems that as soon as those parents can get their kids to kindergarten (free), they do it no matter if the child is ready or not.

This is so true. I had two parents sign wavers to get their children in a year early. The one is so behind as it is. The other has fits when she doesn’t get her way and is kind of mean about it. I’m absolute sick that the parents are doing this. My heart just hurts that they are already telling these parents their kids will get held back for kindergarten. My food program lady pretty much said it like it is. She said that the parents are only doing it for financial reasons. It’s so sad.

[Unregistered]

No idea why! No idea why some providers insist on offering services for WELL below market value either, thus keeping rates low...or why providers don’t unionize, band together and increase pay and working conditions. My guess and I do not mean for this to sound offensive is that most providers are only in it for the short term and have low education/know very little about business.

They don't want to follow standards. I'm a licensed teacher with an MA and have taught in public schools. Many of the posters here aren't qualified to be aides.

[Ariana]

I charge average rates, and I do NOT want to unionize. Being self employed means making my own rules and setting my own rates...a union would only hurt, not help that.

Yes I totally get it! Union jobs though offer higher wages, automatic raises with inflation and seniority, pensions, more time off and more benefits.

[Ariana]

[/B]


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

As for education, I do have an AS degree, but business sense doesn't always come from a college. Life lessons with hard knocks along with a special mentor taught me alot!

I also charge higher fees, always have but cannot price myself completely out of the market. I have recently increased my 8-10 hour rate to roughly $12 a day more than most providers and people are still paying it. I have an education and run my daycare really well so it is high quality which some people are willing and able to pay for.

[Blackcat31]

Yes I totally get it! Union jobs though offer higher wages, automatic raises with inflation and seniority, pensions, more time off and more benefits.

Unions sell that idea to people buts it’s not how it actually works here.

[Blackcat31]

They don't want to follow standards. I'm a licensed teacher with an MA and have taught in public schools. Many of the posters here aren't qualified to be aides.

Was there a thread somewhere in which everyone shared their education levels? If so I haven't seen it but I don't think it matters anyways as many of the posters here ARE more qualified than you think and most know more about children and their development than many others do.

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

SMH at some of the offensive statements I've read lately.

[Cat Herder]

SMH at some of the offensive statements I've read lately.

Mines bigger than yours.

Wait, wrong job site... ::

Wait, no that seems about right.

If only parroting what the professor says for a solid A would just equate to hands-on skills and business management ability, gosh golly.

[LysesKids]

They don't want to follow standards. I'm a licensed teacher with an MA and have taught in public schools. Many of the posters here aren't qualified to be aides.

That's where you are so wrong; many of us are very qualified & we have degrees... I myself was a Sub teacher in a rural area of in TN when my youngest child was 10 (they had more regular substitutes than actual teachers many days).

My clients chose me because I speak more than one language & I did teach my daycare babes. I had a very multi-cultural childcare home for many years (I closed last year), so don't state something you don't know for a fact. I worked in the Legal field for 15 years before teaching & childcare

[Myst_Seattle]

That makes zero sense.
Those with bigger wallets have more options but regardless my issue is that I am limited to x number of spaces and despite the fact that my wait list is also pretty lengthy, raising my rates isn't going to change the maximum capacity the state allows me to have.

I fully agree that it won't let you increase your capacity, but in theory it should increase your profit margin. Let's say you are currently charging $100 per week and have a 3 year waitlist. If you increase it to $110 (for new clients) the waitlist might drop to 2 years. If you further increase it to $120 it might go down to 1 year. Therefore your revenue would increase by 20% without having to take up any extra work.

It would price out some parents out of the daycare market, but at the same time it would help parents who have recently moved into the neighborhood and haven't had a chance to sign up for the waitlist three years ago. That's an issue faced by many of my parent colleagues who are new to Seattle.