Good Neighborhood vs Not That Good Neighborhood

[CAPA]

I am in the process of opening a daycare with my girlfriend. She has worked in a daycare for 5 years and is an education major.

She works for a guy that owns 3 daycares. She tells me that the most profitable one is the one that is in the less privileged neighborhood. She discussed this with all the employees at her daycare and they figured that because the parents of these children receive grants to send their kids to a daycare and because the parents of these children put more trust in the daycare (and are less intrusive) that these daycares are more profitable and easier to run.

One argument she made is that some parents of children who have money tend to be more burdensome and cause more problems. Many times, the children are spoiled and their parents would "rather believe a 3 year old than a daycare worker," in the words of my girlfriend. These parents sometimes assume that a daycare worker doesn't know what's best for their children and will constantly nag the workers. Some of these kids don't follow rules and are very misbehaved.

On the other hand, she told me that kids in neighborhoods with less income tend to respect the workers more and look up to them. They tend to cause less problems, as well as their parents. Their parents are more understanding towards the workers and don't automatically believe what their children say. In effect, these parents would much rather discipline their children than a daycare worker.

What are your opinions about daycares in such neighborhoods? Does this argument hold true in your opinion/experience? Curious to see responses.

[Blackcat31]

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[daycare]

I am in the process of opening a daycare with my girlfriend. She has worked in a daycare for 5 years and is an education major.

She works for a guy that owns 3 daycares. She tells me that the most profitable one is the one that is in the less privileged neighborhood. She discussed this with all the employees at her daycare and they figured that because the parents of these children receive grants to send their kids to a daycare and because the parents of these children put more trust in the daycare (and are less intrusive) that these daycares are more profitable and easier to run.

One argument she made is that some parents of children who have money tend to be more burdensome and cause more problems. Many times, the children are spoiled and their parents would "rather believe a 3 year old than a daycare worker," in the words of my girlfriend. These parents sometimes assume that a daycare worker doesn't know what's best for their children and will constantly nag the workers. Some of these kids don't follow rules and are very misbehaved.

On the other hand, she told me that kids in neighborhoods with less income tend to respect the workers more and look up to them. They tend to cause less problems, as well as their parents. Their parents are more understanding towards the workers and don't automatically believe what their children say. In effect, these parents would much rather discipline their children than a daycare worker.

What are your opinions about daycares in such neighborhoods? Does this argument hold true in your opinion/experience? Curious to see responses.

I have not dealt with too much of lower income, but I don't really think it all comes down to money in the end. I have some parents that are so down to earth and drive jags and I have some that drive ford focus that are a pain in the you know what.

I could see that with lower income you might get more drama, just because from what I have seen with lower income families, they are where they are for the bad decisions that they made (well for the most part). But then on the other end, you are going to have those families that have money so everything has to be there way...

I think that both of them regardless of what neighborhoods they come from can be as profitable as you make them.

[CAPA]

I have not dealt with too much of lower income, but I don't really think it all comes down to money in the end. I have some parents that are so down to earth and drive jags and I have some that drive ford focus that are a pain in the you know what.

I could see that with lower income you might get more drama, just because from what I have seen with lower income families, they are where they are for the bad decisions that they made (well for the most part). But then on the other end, you are going to have those families that have money so everything has to be there way...

I think that both of them regardless of what neighborhoods they come from can be as profitable as you make them.

Yeah, I can see what you mean. What I was saying is that the daycare in the lower income area is more profitable (out of the ones my girlfriend's boss owns). So I was just trying to come up with reasons as to why that may be. I think you are right though, it depends on more than just income. Everyone is different... Although one good point that my girlfriend made is that those in the low-income areas at least wont have the funds to sue you if their kid falls or something. I'm pretty new to the daycare business in general and most of the information I get is from my girlfriend. Thanks for the reply!

[daycare]

i think one of the reasons that it may be more profitable, is because of the fact that the state pays for it and it is a guaranteed payment. Where as cash clients sometimes walk out on bills or may opt to keep kids out of daycare becuase its that fine line of not so affordable.

The economy stinks right now and there are a lot of people dependent on the state. Where as middle class america a lot of families have one parent that got laid off, so one parent is home, keeping the kids out of childcare because they don't qualify for state help with having the other income.... I have lost a lot of really good families because of layoff and then they don't qualify for any kind of help, but then can't afford to pay me.... stinks

[itlw8]

You would need to look at both centers. Often owners pay the staff in a lower income center barely above minimum wage. they also do not spend as much on the building as far as rent nor is it at the same standard as one in a higher income area. Same quality of care??? often not. So I guess there would be more profit if the owners keep more of the profit and do not invest it in the business.

[CAPA]

You would need to look at both centers. Often owners pay the staff in a lower income center barely above minimum wage. they also do not spend as much on the building as far as rent nor is it at the same standard as one in a higher income area. Same quality of care??? often not. So I guess there would be more profit if the owners keep more of the profit and do not invest it in the business.

Yes, she told me that the daycare center in the worse neighborhood is not very well kept and probably pays less rent than the other two. I'm sure that is a key point in why it is more profitable.

I'm curious, if either one of you know about the state grant system? Have either one of you become qualified to receive client's children funded by the government. Sorry if I'm not using the right terminology.

[daycare]

Yes, she told me that the daycare center in the worse neighborhood is not very well kept and probably pays less rent than the other two. I'm sure that is a key point in why it is more profitable.

I'm curious, if either one of you know about the state grant system? Have either one of you become qualified to receive client's children funded by the government. Sorry if I'm not using the right terminology.

im a home DC and I only take private payment. I don't take state clients. One reason is that my state CA is dead broke and are cutting even more money for childcare.

Wish I had more information to give you. perhaps others will have advice for you.

[CAPA]

im a home DC and I only take private payment. I don't take state clients. One reason is that my state CA is dead broke and are cutting even more money for childcare.

Wish I had more information to give you. perhaps others will have advice for you.

You have been of great help already! I just moved from California to Pennyslvania... hence my name "CAPA."

[daycare]

You have been of great help already! I just moved from California to Pennyslvania... hence my name "CAPA."

oh really where abouts CA???

[Blackcat31]

I'm curious, if either one of you know about the state grant system? Have either one of you become qualified to receive client's children funded by the government. Sorry if I'm not using the right terminology.

Here is the link to Child Care Services in Philladelphia. Perhaps the link has info you are looking for or information to find out where to go to get the info you are searching for.

http://philadelphiachildcare.org/

[providerandmomof4]

I don't agree that lower income areas are more profitable. I run a licensed daycare from my home and my neighborhood used to be really good. Now it's going downward, with a lot of rentals and people not keeping up their property. I think this effects my business greatly. It shouldn't be so, and even though my house looks nice, a lot of people look at the surrounding houses and I know that they choose to go elsewhere. I had to cut my rates drastically and I have had experience with some very undependable parents (pay two weeks and then are never heard from again). I have a hard time believing that the lower income areas are more profitable. In my experience...they're definitely not.

[itlw8]

I think that maybe a rented business that is overcrowded and not maintained as well on paper make more money. But is it good for the children or the owners pocketbook. In the long run will the business gain a good reputation and stay in business??

A family childcare you own your own home and maintain it. fewer children, parents think you should charge less. = less profit


If I were starting a business I would choose a middle class area with good access to parents traveling to work.plenty of parking and outdoor space.

[Solandia]

Several factors go into it, I am sure. The biggies that stand out to me would be directluy related to daycares in low-income areas...

1)food program reimbursements are way more than the cost of the food. 2)there are a ton of grants available to home daycare/centers that have a certain percentage of enrollement under a certain income level. Those grants are HUGE. Even as "just" a home daycare provider, if 50% of my enrolled kids were subsidy, I could have qualified for a 5-10K grant per year. that is HUGE...that doubles my annual profit, IF i have full enrollment. Centers with 25%+subsidy client...it was typical in our county to have available grants for 100K/year. It was amazing what was out there (i had taken a grant writing class through the county).

The downside (why I didn't appy for the grants), is that if you don't maintain enrollment of that percentage -or- go out of business within 2 years, the $$ has to be paid back on a prorated basis. I didn't want to feel "stuck" for 2 years.

[CAPA]

oh really where abouts CA???

The valley in los angeles. I'm originally from PA and I only moved there for a year... and couldn't wait to leave the valley haha.