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Running a daycare involves significant monthly operating costs that typically range from $19,570 to $39,700 for a medium-sized center.
Staff salaries consume the largest portion of your budget at 40-50%, while rent, food, and utilities represent other major expense categories. Understanding these costs is crucial for maintaining profitability and providing quality childcare services.
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Monthly daycare operating costs vary significantly based on size, location, and enrollment numbers.
A typical medium-sized daycare center spends between $19,570 and $39,700 per month on essential operating expenses.
| Cost Category | Monthly Range (USD) | Key Details |
|---|---|---|
| Staff Salaries & Wages | $15,000 - $25,000 | Includes full-time teachers at $12-20/hour, part-time assistants, substitute workers, plus 15-35% for benefits and payroll taxes |
| Rent/Mortgage | $2,000 - $5,000 | Commercial facility lease in suburban areas; home-based daycares operate at $800-1,000 monthly |
| Food & Snacks | $1,000 - $5,000 | Averages $150-200 per child monthly for breakfast, lunch, and two snacks following USDA guidelines |
| Utilities | $500 - $1,500 | Electricity, water, heating/cooling for 3,000-5,000 sq ft facility, plus $80-150 for internet/phone |
| Insurance | $100 - $600+ | General liability, property, abuse liability, and workers' compensation coverage based on enrollment size |
| Educational Supplies | $300 - $800 | Age-appropriate toys, books, art supplies, learning materials replaced quarterly |
| Cleaning & Maintenance | $600 - $1,800 | Daily sanitization supplies, professional cleaning services, routine facility repairs |
What's the typical monthly budget breakdown for running a daycare?
The average monthly operating budget for a daycare ranges from $19,570 to $39,700, depending on your center's size and location.
Staff salaries dominate your budget at 40-50% of total expenses, typically $15,000-$25,000 monthly for a medium-sized center. Rent or mortgage payments follow as the second-largest expense at $2,000-$5,000, while food costs average $1,000-$5,000 based on enrollment.
Essential operating expenses include utilities ($500-$1,500), insurance ($100-$600+), and educational supplies ($300-$800). Administrative costs like software subscriptions run $20-$300 monthly, while cleaning and maintenance require $600-$1,800.
Marketing typically needs $300-$1,000 monthly to maintain enrollment, and you should reserve $50-$500 for licensing and compliance fees. Home-based daycares operate at the lower end of these ranges, while large commercial centers often exceed them.
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How much should I budget for staff salaries each month?
Staff salaries typically consume $15,000 to $25,000 monthly for a medium-sized daycare center, representing 40-50% of your total operating budget.
Full-time teachers earn $12-$20 per hour depending on experience and location, while part-time assistants receive $10-$15 hourly. A center with 40 children typically employs 6-8 full-time staff members and 2-3 part-time workers to maintain proper ratios.
Benefits and payroll taxes add 15-35% to base wages, including health insurance, paid time off, and workers' compensation. Substitute teachers cost an additional $500-$1,000 monthly to cover sick days and vacations.
Directors and lead teachers command higher salaries, often $18-$25 per hour or $3,000-$4,000 monthly. Assistant teachers and floaters typically earn $2,000-$2,500 monthly, while specialized staff like curriculum coordinators may add another $3,000-$4,000 to your payroll.
Remember to budget for annual raises, typically 2-5%, and consider offering competitive benefits to reduce turnover, which can cost 50-200% of an employee's annual salary to replace.
What are typical monthly rent costs for daycare facilities?
Commercial daycare facilities typically cost $2,000 to $5,000 monthly in rent, varying significantly by location and square footage.
Urban centers command premium rents of $15-$25 per square foot annually, while suburban locations average $10-$20. A 3,000-square-foot facility in a suburban area typically rents for $2,500-$3,500 monthly, including common area maintenance fees.
Home-based daycares operate with much lower overhead, allocating $800-$1,000 monthly for the business portion of mortgage or rent. This represents approximately 20-30% of total home expenses based on the square footage dedicated to childcare.
Location dramatically impacts costs - facilities near elementary schools or in family-friendly neighborhoods often charge 20-30% premium rents. Triple net leases add property taxes, insurance, and maintenance costs, potentially increasing your base rent by $500-$1,000 monthly.
Consider negotiating multi-year leases for better rates, as landlords often provide 1-2 months free rent or tenant improvements worth $10-$30 per square foot for 5-year commitments.
How much do utilities cost for a daycare each month?
Monthly utility expenses for daycares typically range from $500 to $1,500, depending on facility size and climate conditions.
Electricity represents the largest utility expense at $300-$800 monthly for a 3,000-5,000 square foot facility. Heating and cooling costs fluctuate seasonally, averaging $200-$500 monthly, with summer and winter peaks 30-50% higher than spring and fall.
Water and sewer services cost $100-$300 monthly due to frequent handwashing, toilet use, and cleaning requirements. Internet and phone services add $80-$150 for business-grade connections supporting parent communication apps and security cameras.
Energy-efficient upgrades can reduce costs by 20-30% - programmable thermostats, LED lighting, and low-flow fixtures typically pay for themselves within 2-3 years. Many utilities offer commercial energy audits and rebates for efficiency improvements.
Larger centers exceeding 5,000 square feet often see utility costs reach $2,000-$3,000 monthly, especially in extreme climates requiring constant temperature control for children's comfort and safety.
What's the monthly food budget for a daycare?
Food and snack costs typically range from $1,000 to $5,000 monthly, averaging $150-$200 per child.
| Enrollment Size | Monthly Food Budget | Cost Per Child |
|---|---|---|
| 20 children (small center) | $1,000 - $1,500 | $50 - $75 per child |
| 40 children (medium center) | $2,000 - $3,200 | $50 - $80 per child |
| 60 children (large center) | $3,000 - $5,000 | $50 - $83 per child |
| USDA Food Program participants | 20-40% reduction | Reimbursement of $1.50-$3.50 per meal |
| Organic/special diet programs | 30-50% increase | $200 - $300 per child |
| Infant formula/baby food | Additional $100-$150 | Per infant enrolled |
| Catered meal programs | $3.50 - $5.00 per meal | Includes delivery and service |
How much should I spend on educational materials and toys monthly?
Educational materials and toys require a monthly budget of $300 to $800, representing 5-10% of your overall operating expenses.
Initial classroom setup costs $2,000-$5,000 per room, but monthly replenishment and updates average $75-$200 per classroom. Age-appropriate materials need regular rotation - infant rooms require sensory toys and soft blocks, while preschool rooms need puzzles, art supplies, and early literacy materials.
Consumable supplies like crayons, paper, glue, and paint typically cost $100-$200 monthly for a 40-child center. Durable items like books, manipulatives, and educational games need replacement every 6-12 months due to heavy use.
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Quality matters for safety and longevity - investing in commercial-grade furniture and toys reduces replacement frequency by 50% compared to consumer-grade items. Many suppliers offer educator discounts of 10-20%, and bulk purchases can save an additional 15-25%.
What are typical cleaning and janitorial costs per month?
Cleaning and janitorial expenses typically range from $600 to $1,800 monthly, combining supplies and professional services.
Daily cleaning supplies cost $200-$500 monthly, including disinfectants, paper towels, toilet paper, and hand soap. Centers use 50% more cleaning supplies than typical offices due to strict sanitation requirements and frequent messes.
Professional cleaning services charge $400-$1,000 monthly for nightly cleaning of a medium-sized facility. Small centers might spend $200-$500 for three-times-weekly service, while large centers exceed $1,500 for daily deep cleaning.
Specialized services add to costs - carpet cleaning ($200-$400 quarterly), window washing ($100-$200 monthly), and playground sanitization ($150-$300 monthly). State regulations often mandate specific cleaning frequencies and EPA-approved disinfectants.
Many centers employ part-time janitors at $12-$15 hourly for 20-30 hours weekly, costing $1,000-$1,800 monthly including payroll taxes. This often proves more economical than outsourced services while ensuring consistent quality.
How much does daycare insurance cost monthly?
Monthly insurance costs range from $100 to $600+ depending on coverage types, enrollment size, and location.
General liability insurance forms the foundation at $50-$150 monthly for basic coverage of $1-2 million per occurrence. Property insurance adds $50-$200 monthly based on building value and contents, while professional liability coverage costs another $50-$100.
Workers' compensation insurance varies by state but typically costs $100-$300 monthly per $100,000 in payroll. Abuse and molestation liability coverage, often required by licensing, adds $50-$150 monthly for adequate protection.
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Commercial auto insurance for transportation services costs $150-$300 monthly per vehicle. Umbrella policies providing additional coverage beyond primary limits typically add $100-$200 monthly for $1-5 million in extra protection.
What's the monthly cost for daycare management software?
Daycare management software typically costs $20 to $300 monthly, depending on features and enrollment size.
- Basic plans ($20-$50/month): Include attendance tracking, basic parent communication, and simple billing features for centers with under 30 children.
- Standard plans ($75-$150/month): Offer automated billing, parent apps, digital daily reports, photo sharing, and meal tracking for 30-75 children.
- Premium plans ($150-$300/month): Feature advanced reporting, waitlist management, staff scheduling, payroll integration, and unlimited users for 75+ children.
- Additional features: Payment processing adds 2.5-3% per transaction, while features like lesson planning, assessment tools, and custom reports may cost $10-$50 extra monthly.
- Implementation costs: Initial setup and training typically require $200-$500 one-time investment, with ongoing support included in monthly fees.
How much should I budget for licensing and compliance monthly?
Licensing and compliance costs average $50 to $500 monthly when annual expenses are distributed throughout the year.
Initial licensing fees range from $100-$1,000 annually depending on your state, while renewal fees typically cost $50-$500 yearly. Background checks for new staff members cost $50-$150 per person, with most centers processing 2-4 new employees monthly.
Mandatory training requirements add $100-$300 monthly - most states require 15-24 hours of annual professional development per staff member. Online training subscriptions cost $20-$50 per employee annually, while in-person workshops run $50-$200 per session.
Health and safety inspections may require $200-$1,000 in annual improvements to maintain compliance. Fire marshal inspections, health department reviews, and licensing visits often identify needed updates to equipment, signage, or procedures.
Accreditation through NAEYC or similar organizations costs $500-$2,000 annually but can justify 10-20% higher tuition rates. Many centers allocate $100-$200 monthly for ongoing compliance consulting to ensure adherence to changing regulations.
What should I allocate for maintenance and repairs each month?
Facility maintenance and repairs typically require $200 to $800 monthly, representing 2-4% of gross revenue.
| Maintenance Category | Monthly Cost Range | Typical Issues |
|---|---|---|
| HVAC maintenance | $100 - $200 | Filter changes, seasonal tune-ups, minor repairs |
| Plumbing repairs | $50 - $150 | Toilet repairs, faucet leaks, drain cleaning |
| Playground maintenance | $100 - $200 | Safety surface replenishment, equipment tightening, repairs |
| Electrical work | $50 - $100 | Outlet repairs, lighting replacements, safety updates |
| Painting and patching | $75 - $150 | Wall repairs from daily wear, touch-up painting |
| Flooring repairs | $50 - $125 | Carpet cleaning, tile replacement, mat repairs |
| Emergency fund reserve | $100 - $200 | Major repairs like roof leaks or equipment failure |
How much should I spend on marketing and advertising monthly?
Marketing budgets typically range from $300 to $1,000 monthly, representing 5-10% of gross revenue for established daycares.
Digital marketing consumes $150-$500 monthly through Google Ads, Facebook advertising, and local parenting website listings. Social media management tools cost $20-$50 monthly, while professional photography for content creation runs $200-$500 quarterly.
Traditional marketing methods remain effective - yard signs cost $100-$200, local newspaper ads run $200-$400 monthly, and community event sponsorships average $100-$300 per event. Many centers allocate $100-$200 monthly for printed materials like brochures and business cards.
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New centers should budget 15-20% of projected revenue for marketing during the first six months to build enrollment. Referral programs offering $100-$200 credits for successful enrollments often provide the best return on investment, costing $300-$500 monthly but generating 40-60% of new enrollments.
Conclusion
This article is for informational purposes only and should not be considered financial advice. Readers are encouraged to consult with a qualified professional before making any investment decisions. We accept no liability for any actions taken based on the information provided.
Running a successful daycare requires careful financial planning and budgeting across multiple expense categories.
Understanding these monthly costs helps you set appropriate tuition rates, maintain healthy profit margins, and ensure sustainable operations while providing quality childcare services to families in your community.
Sources
- Daycare Expenses Overview - Dojo Business
- Running Costs for Daycare - Business Plan Templates
- Operating Costs for Daycare Centers - FinModelsLab
- How Much is Daycare Insurance - KBD Insurance
- Child Care Software - Capterra
- Daycare Cleaning Service Cost - AIM Commercial Cleaning
- Checklist for Starting a Daycare Business - Brightwheel
- Daycare Insurance Cost - Next Insurance
- Daycare Center Expenses - ProCare Software
- Home-Based Daycare Running Costs - Business Plan Templates