Owning a Daycare Business: 7 Mistakes I'd Never Make Again After 21 Years

Sep 29

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If you're new here, welcome! Before we get started, grab my free Fill Your Spots Enrollment Audit. It walks you through the gaps that keep families from enrolling, so you can finally fill your open spots.

Now let's dive into the 7 mistakes I’d never make again in my childcare center.

When we opened our center in 2001, I believed that if I loved the kids and hired good people, the business would take care of itself. It didn't.

I spent over 21 years as a daycare director and led a team of about 25 people. I've dealt with just about everything this business can throw at you. Licensing visits. Staff call-outs. Upset parents. Tight months. And looking back, most of my hardest seasons came from a handful of decisions I kept making because I thought I was being kind.

So here are the seven daycare business mistakes I'd never make again, and what I'd do instead. Some are money mistakes. Some are people mistakes. And the last one is the one I wish someone had told me in year one.

If you're thinking about owning a daycare business, or you're already deep in it, you get to learn these the easy way instead of the way I did.

For an even bigger list, check out The 12 Most Common Child Care Business Mistakes.

1. Letting late tuition payments slide

I get it. You know these families. You love their kids. And when a mom tells you she's had a hard week, you want to give her grace. So you let it go. And then you let it go again.

Here's the thing. Your expenses don't wait. Payroll is due Friday whether tuition came in or not. When you let a late payment slide, the problem is still there. You're just the one holding it now.

What I'd do instead: Put your daycare late payment policy in writing and have every family sign it. Apply your late fee every single time, with the same rule for everyone. And set up autopay, so tuition comes out on its own and you're not chasing anybody. That one change takes so much stress off your plate.

When you do need to send a reminder, keep it kind and clear. Here's what I'd say:

"Hi Tasha! Just a friendly reminder that tuition was due Monday. Our late fee is added on Wednesday, and I'd love to help you avoid it. Here's the payment link."

Send that same message to every family, every time.

2. Offering a daycare sibling discount without doing the math

Sibling discounts feel generous, and they feel like a smart way to win families. But most families are going to enroll both kids with you anyway. So a lot of that discount is money you're giving away for something that was already going to happen.

Do the math. A $30 weekly sibling discount adds up to $1,560 a year for one family. If ten families get that discount, that's $15,600 a year. That's enough to hire a part-time teacher or upgrade your playground.

What I'd do instead: Offer perks that don't come out of your tuition. Priority enrollment for younger siblings. First pick of the summer schedule. Things families value that don't cost you your margin.

Staff discounts are a different story. I love them. Offer at least 50% off for your staff's children. That's an investment in keeping good teachers, which leads right into the next one.

For the full pros and cons of discounts, check out Should You Offer Childcare Discounts to Families?

3. Hiring daycare staff just to fill a ratio

We've all been there. Someone calls out, you're out of ratio, and you're covering the toddler room yourself for the third day in a row. So when someone walks in with a clean background check and says they can start Monday, you hire them on the spot.

Two weeks later, they're gone. Or they stay, and your best teachers start wearing down from carrying the extra weight.

What I'd do instead: Recruit all the time, even when you're fully staffed. Keep a short list of great candidates you've already met. And before you hire anyone, if your state allows it, do a working interview in the classroom. One hour of watching someone with the kids tells you more than any interview question will.

4. Treating staff culture like an extra

In my early years, I thought culture was pizza parties. Nice to have, if there was time. What I learned is that culture is the heart of daycare staff retention. It's what keeps people.

When teachers feel appreciated, they stay, and they take care of your families like their own. Some of the teachers who left my center came back asking for their job back, more times than I can count. That doesn't happen by accident. It happens because you built a place people want to work.

What I'd do instead: Start here.

Recognize your team out loud, especially when they live out your core values.
Give teachers some say in their own classroom, like schedule tweaks and activity ideas.
Build in flexibility wherever licensing allows.
Make time for real fun together.

If a couple of these hit your wallet, check out my free Revenue Booster Guide. It has 12 ways to boost your income without raising tuition.

5. Waiting for empty spots to start daycare marketing

For years, I only thought about enrollment when a family gave notice. Then it was a scramble. Flyers went up. Facebook posts went out. And since it takes time to fill a spot, every scramble cost us weeks of lost tuition.

What I'd do instead: Keep your daycare marketing running all year long. Keep your Google profile fresh with new photos. Keep your waitlist warm. And thank your current families for referrals, because happy parents are the best marketing you'll ever have.

If enrollment is your biggest worry right now, then check out my free Fill Your Spots Enrollment Audit to find the gaps and finally fill your open spots.

6. Being the only one who knows how your daycare runs

For a long time, everything ran through me. The schedule. The billing. The licensing binder. Where the extra diapers were. If I took a day off, my phone rang all day. So honestly, I couldn't really take a day off.

Here's the truth. If everything depends on you, you can never step away. And a business you can never step away from will wear you down.

What I'd do instead: Write it down. Start with the tasks you do every week, and make a simple checklist for each one. Then train someone you trust, like a lead teacher or an assistant director, to handle them. One system a month. By the end of the year, your center runs well even on the days you're not there.

7. Trying to run a daycare all alone

I almost left this one off the list. But it's the one I needed to hear the most.

Being a director is lonely. You can't vent to your staff or to your parents. The people at home love you, but they don't really understand what it's like to get a call from licensing on a Tuesday afternoon, or to lose your best teacher in the middle of the school year.

So for years, I figured it out by myself. Every hard conversation. Every tough decision. And I made a lot of the mistakes on this list because I didn't have anyone to ask.

What I'd do instead: Find your people. Other owners and directors who get it. People you can text when a parent is upset or a teacher quits, who have already solved the problem you're facing right now.

That's exactly why I started the Childcare Leaders Circle. It's a community for childcare owners and directors, with templates and real support, so you don't have to figure everything out on your own anymore.

The short version: 7 daycare business mistakes to avoid

After 21 years, here's what I'd never do again:

Let late tuition slide.
Offer a sibling discount without doing the math.
Hire in a panic just to stay in ratio.
Treat staff culture like an extra.
Wait for empty spots to start marketing.
Be the only one who knows how everything runs.
Try to do it alone.

If you saw yourself in a few of these, you're in good company. I did every single one of them, and I still built a program I'm proud of.

You're already doing hard work. Let me help make it a little lighter. Check out the Childcare Leaders Circle, and grab the free Revenue Booster Guide if you haven't yet. Still planning your program? Check out my free Daycare Starter Guide, with the first steps to launching your childcare business.

Now tell me in the comments which one hit closest to home for you. I read every one.

Frequently asked questions about owning a daycare business

What is the biggest mistake new daycare owners make?

Treating the business side like it will take care of itself. Most of us open because we love kids. Then late payments and rushed hires start draining the budget. Put your policies in writing from day one and build your systems early.

How do I get daycare parents to pay tuition on time?

Have every family sign a written late payment policy. Apply your late fee every time, with the same rule for everyone. Then set up autopay so tuition comes out on its own and you're not chasing anybody.

Should a daycare offer a sibling discount?

Only after you do the math. A $30 weekly sibling discount costs you $1,560 a year per family, and most families would enroll both kids anyway. Perks like priority enrollment or first pick of the summer schedule give families real value without cutting into tuition.

How do daycare owners keep good staff?

Make culture a priority. Recognize teachers out loud and give them a real say in their classrooms. Build in flexibility wherever licensing allows, and keep recruiting even when you're fully staffed.

Is owning a daycare business worth it?

For me, it was. I made every mistake on this list and still built a program I'm proud of over 21 years. Learning these lessons early makes your business more profitable and a lot less stressful.

Before You Go:

If you're feeling overwhelmed with everything it takes to run a childcare business, you're not alone in that.

The enrollment. The staff. The parents. The paperwork. The policies. The money. And somewhere in there, you're supposed to plan a fundraiser too.

Most of us started this because we love kids, not because we wanted to be a full-time HR manager, bookkeeper, and marketer. And when you're doing all of it by yourself, it can start to feel like you're barely keeping your head above water.

That's why I created the Childcare Leaders Circle.

It's a membership community for childcare owners and leaders who are done figuring it out alone. Inside, you get real support from people who understand exactly what you're dealing with, plus done-for-you tools and templates so you're not starting from scratch every time something comes up.

You don't have to carry all of it by yourself.

👉 Learn more about the Childcare Leaders Circle here