Last month, 300,000 jobs were added to the U.S. economy. For 12 months in a row, the United States has added at least 200,000 jobs — a sustained pace of hiring unmatched since 1994 and 1995. That is tremendous news for you, as an early childhood business owner or leader. Obviously, our industry is inextricably tied to the ebbs and flows of job growth in this country. So when job growth expands, as it has recently, newly employed parents need child care – which means your phone is ringing more, and you are enrolling more children at a faster rate than prior years, depending on the dynamics of your local market.
So now that you’re more full to capacity, or maybe even have a waiting list of children, what can you do to continue to increase your revenue and cash-flow? I’ve gotten this question a lot from owners, especially those in a rural market who have a limited supply of families and are even more susceptible to population and job growth swings.
Let me share 3 ways you can add more revenue to your business, other than enrolling more children.
- Monetize Your Facility. Think about this. You have a brick and mortar facility that’s likely sitting empty 2 days out of 7 week in, week out. That’s an “asset usage rate” of just 71%. So you’re missing out on 29% of potential revenue, right off the bat, and that doesn’t even include weekday evenings past 6:30 pm. So how can you better monetize your primary asset – your building which is sitting empty on evenings and weekends
The most logical way is to find other organizations and companies in your area that need a facility such as yours. These could range from church groups, Weight Watcher groups, moms clubs, scouting groups, and the like to Mommy and Me Yoga programs or Kindermusik partnerships. There are many home-based child franchises that might need exactly the sort of space your center can provide, and they will pay you nicely for it. With this strategy, you could potentially add up to $1,000 or more per month in revenue by just renting out your facility.
- Provide Add-On Services. When people like and trust a business they use frequently, they often look to that business to provide a wider variety of services. For example, even though I started out only providing marketing and enrollment training and products, I quickly expanded my expertise to time management, goal-setting, staff hiring and retention, and cash flow management. Why? Because my clients and members asked for help in those areas. They already had a strong trusting relationship with me, and wanted me to help them more broadly. The same holds true for you. So consider adding more family-focused or child-supportive services and products to your business. For example, you could easily run a children’s birthday party business on the side, during evenings or weekends out of your facility. Hire a birthday party manager and create a program together, with a shared revenue model. Many moms in the area would love some side income and have a huge passion and creativity for party planning.
Other add-on services you could provide include a hair-cutting service, child/family portraits, dry-cleaning, prepared dinners, enrichment programs – the sky’s the limit. You may be currently providing these services but not taking a piece of the revenue pie. Think about restructuring these partnerships so you get a commission of the sales you bring. A 10-20% share of the revenue is fairly standard, and could bring you several thousand dollars per year, or more.
3) Join Affiliate / Referral Programs. Affiliate and referral programs are most often online programs where you sign up as an affiliate or referral partner, and send people to a special referral link to purchase goods or services. The first of these that comes to mind is Amazon.com, which has probably the largest affiliate program in the world, as you might guess. Amazon pays 4% to 8% in commission to its affiliates. The cool thing is, if you send people over to buy something specific on Amazon using your referral link, every single thing that they buy during that transaction, you will receive a commission on. For example, at holiday time you could create a “Parents Shopping List” full of books and toys that you as the early learning expert recommend, and maybe they’re items related to what you’ve used in your program. Parents would click on the special referral link you provide to go shop. Anything they put in their cart during that session you receive commission on. If just 20 parents in your program use the link, and they each purchase $250 worth of merchandise from Amazon, you would receive a check for around $300 from Amazon.
Other child-focused products that have affiliate programs include fun learning “ship to home” products like Little Passports, Surprise Ride, and BabbaBox. These are monthly subscription-based products that ship to the child’s home with learning themes, toys, activities, and the like. If you refer 20 ongoing customers to Little Passports as an affiliate partner, that will provide a revenue stream of $150-$200 a month for you. You can see how these affiliate revenue streams can easily add up over time, for a small amount of time and effort. Of course, you could delegate the management of your affiliate and referral relationships to an employee or part-time office assistant. One final note – a great resource for finding affiliate programs that are child/family focused is Clickbank.