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

[tandow]

Nope. The AVERAGE price of daycare in Seattle is $1200.

http://www.seattleschild.com/Cut-the-cost-of-childcare/

[Myst_Seattle]

It sounds as though you've just disproved your own theory. From what you've just said, Seattle providers have already raised their rates to the point where a large percentage of families can't afford care and yet, there are still long waiting lists that still exist. Once day care becomes too expensive, you're right...many people will decide to stay home and raise their own kids. Working won't be a viable choice for them. That won't result in shorter waiting lists. They will still exist because most of the providers who exist currently will have priced themselves out of business. Fewer providers doesn't equal shorter wait lists for the parents who still need/choose to work.

Not really. This just shows that $2000 is not high enough, which isn't surprising as we have tens of thousands of highly paid Boeing, Microsoft, Amazon, Google employees living in the city. However no one has infinite money so at some price point (say $3000) parents will start dropping out of the waitlist and it will become possible to get a spot on a short notice.

[Myst_Seattle]

Nope. The AVERAGE price of daycare in Seattle is $1200.

http://www.seattleschild.com/Cut-the-cost-of-childcare/

That article is from 2016 and lists $381 per week for center based care, which is $1524 per month. Unfortunately costs have further increased around here, especially if you want something close to downtown.

[tandow]

The average Boeing employees makes $125,000 a year. There are 80,000 employees in the Greater Seattle region.

Microsoft? $207,500. 42,000 employees.

Amazon? $159,000. 25,000 employees. (including employees in their fulfillment centers that are in places like Renton and Dupont)

Google? $200,500. They're not even CLOSE to being one of the Seattle metros top employers, with only 98,000 employees worldwide.

The average NET salary in Seattle is $69,000.

Basically what you're saying is that we need to raise our prices so that only the wealthy are entitled to quality childcare.

Nevermind that we have years of experience, and actually know what we're talking about.

If someone offered me $5000 to get off my waitlist I'd laugh in their face. I don't want parents that think they can "buy" me. My policies are mine, and they're set for a reason. Entitled parents in the beginning typically end up being problem parents while using your services. They want it when they want it, no matter how you or the other parents of children in your care are affected.

But you be stubborn and stick to your guns.... your OPINION on this is obviously worth more to you than our experience.

[Annalee]

In the beginning, I wanted to stay up with this thread just because it interested me but now I'm thouroughly:confused:and going.

"What does any of this have to do with the price of beans in China?" as my grandfather used to say::

[Myst_Seattle]

Basically what you're saying is that we need to raise our prices so that only the wealthy are entitled to quality childcare.

I'm sorry I gave you that impression. I'm just asking why daycare providers don't raise their prices more. If part of the answer is "I don't want to price out everyone but the wealthiest parents", I'd take it. I actually mentioned this as my hypothesis back in the very first post.

Nevermind that we have years of experience, and actually know what we're talking about.

I could not agree more! Nobody knows better than an actual daycare provider.

If someone offered me $5000 to get off my waitlist I'd laugh in their face. I don't want parents that think they can "buy" me. My policies are mine, and they're set for a reason. Entitled parents in the beginning typically end up being problem parents while using your services. They want it when they want it, no matter how you or the other parents of children in your care are affected.

I see. So having a long waitlist is convenient as you can always kick out a parent from your business for obnoxious behavior? As opposed to charging a lot of money and having to deal with adult tantrums.

But you be stubborn and stick to your guns.... your OPINION on this is obviously worth more to you than our experience.

I'm only sticking to my guns about the claim that increased pricing could not eliminate waitlists I do not have any "guns" about the practicalities of daycare operations.

[Blackcat31]

An alternative option is to have a fee to skip the waiting list. So for say $5000 you'd get to be the first family to get offered a spot.

Isn't that kind of how all those parents got in trouble with getting their kids into college?

So basically parents can buy their way to the front of the line? That's really sad.

Got it. So essentially daycares are trying to avoid being accused of unethical behaviour and thus losing clients in the long term. Otherwise everyone would maximize their prices or charge fees to skip the waitlist. This pretty much answers my original question.

Daycares (in general) aren't trying to avoid being accused of unethical behavior....they simply aren't unethical. period. The provider that is all business and nothing but business is few and far between. 99% of providers care MORE about their clients than they do about the income.

Haven't you read the venting thread here?

If not, I suggest you do. Almost every single post involves a provider trying to help a child/family and not wanting to term them for fear of failing them. If it was all about the money and only the money kids would be termed every time some one else came along and offered a $1 more a day for the spot.



Lastly you never answered my question about how waitlists actually work..... Waitlists are not first on the list gets the spot like most places. Wait lists that operate that way might benefit from your theory but in reality it's BEST fit gets the open spot. So the Smith family might only spend 3 days on a wait list before getting a spot even though the Jones family has been on the list for 3 years.

No matter how much money the Jones family pays if they aren't a good fit, they aren't going to be first pick.

[Blackcat31]

I see. So having a long waitlist is convenient as you can always kick out a parent from your business for obnoxious behavior? As opposed to charging a lot of money and having to deal with adult tantrums.

It isn't about convenience. It's about keeping my own family fed and keeping my finances in check too... Like previously posted....it's about job security. Not all areas in the country are the same so not all daycares have waitlists.

But yes, some of the adult tantrums we've witnessed or endured are not worth any amount of money.

I am more business geared than most providers but even I have my limits and I've termed families that have certain behaviors and attitudes simply because I value myself and my self worth MORE than I value my bank account.

There will be no U-Haul trucks following my funeral procession. I'd rather make a difference in someone's life than earn an extra $ or two. In the child care business it isn't black and white like it might be in other businesses.

[Myst_Seattle]

Isn't that kind of how all those parents got in trouble with getting their kids into college?

So basically parents can buy their way to the front of the line? That's really sad.

It's only illegal if you pay a bribe to secure a spot. If you have an official pricelist for skipping the line its perfectly legal, just like you can skip the line at most airports for a fee. I've read that some places let you pay a "donation" to skip the line to their daycare, but that's rare.

Lastly you never answered my question about how waitlists actually work..... Waitlists are not first on the list gets the spot like most places. Wait lists that operate that way might benefit from your theory but in reality it's BEST fit gets the open spot. So the Smith family might only spend 3 days on a wait list before getting a spot even though the Jones family has been on the list for 3 years.

No matter how much money the Jones family pays if they aren't a good fit, they aren't going to be first pick.

You could always vary your pricing based on fit. E.g. if the Smiths are for some reason the best clients for your particular daycare you could offer them a better rate to incentivize them to join. For example car rental companies sometimes let you borrow a car for free if you drive it from city A to city B for them, when they need to shuffle cars around.

[Blackcat31]

It's only illegal if you pay a bribe to secure a spot. If you have an official pricelist for skipping the line its perfectly legal, just like you can skip the line at most airports for a fee. I've read that some places let you pay a "donation" to skip the line to their daycare, but that's rare.

It's illegal for daycare providers to even discuss rates with each other so I'd be surprised if the above is legal.

Call it a donation or a bribe it is what it is and it's unethical.

You could always vary your pricing based on fit. E.g. if the Smiths are for some reason the best clients for your particular daycare you could offer them a better rate to incentivize them to join. For example car rental companies sometimes let you borrow a car for free if you drive it from city A to city B for them, when they need to shuffle cars around.

If the Smith's are already on my waitlist to enroll I don't need to incentivize them to enroll. I don't understand what you mean by that.

[Myst_Seattle]

It's illegal for daycare providers to even discuss rates with each other so I'd be surprised if the above is legal.

Call it a donation or a bribe it is what it is and it's unethical.

It's only unethical if its a backroom kind-of a deal. If you have an official pricelist on your website with everything clearly explained its not unethical at all, in my opinion. Otherwise we should ban business class on airlines But I do agree parents might be furious over this kind of pricing strategy.

If the Smith's are already on my waitlist to enroll I don't need to incentivize them to enroll. I don't understand what you mean by that.

To rephrase my original explanation: charging some people more to skip the waitlist doesn't mean you can't offer others an immediate vacancy for free. To give another example - airlines often give nice perks to military personnel in active service, even if everyone else has to pay for the privilege.

[Ariana]

I have to say, that comment really rubbed me the wrong way. That statement couldn't be further from the truth. Maybe where you live, that's what you're seeing. In my area, we take pride in our field. Many of us have had years of early childhood education and training. I don't know too many fields that require the ongoing training we do here.

In regards to short term: The providers I know have 10 years or more under their belt. Myself included.

Here it is a completely different story and I said MOST not ALL providers. We all know great educated providers and we all know dolts.

[Cat Herder]

Here it is a completely different story and I said MOST not ALL providers. We all know great educated providers and we all know dolts.

I understood what you meant because we discuss it frequently. The vast majority of providers wash out within two years. We also discuss the sheer number of providers who think they are the special exception to laws governing our field. Yes, those groups equate to the majority of providers at any given time.

[Ariana]

I understood what you meant because we discuss it frequently. The vast majority of providers wash out within two years. We also discuss the sheer number of providers who think they are the special exception to laws governing our field. Yes, those groups equate to the majority of providers at any given time.

Yes! I also did not in any way say my assumption was correct. Just throwing out an idea as to why providers do not charge more and that was my best guess.

We are THE most essential service. There is no other service more essential than ours. Yet we are some of the lowest paid workers. Do the math it just does not add up and I think it is good to have a conversation about it

FWIW I think Myst Seattle has some good points to ponder if only we could stop taking things so personally and listen.

[Blackcat31]

I am curious so I PM'ed Tom Copeland and asked for his legal advice/interpretation as to the legality of this "idea".

Hopefully he will put his two cents in.