Discovery Point Blog
Daycare Business Success: Inside the Franchise Model
Opening a daycare business through franchising is an excellent option if you want to minimize your risk and enjoy expert support with your new business venture. The many benefits of franchising make this one of the fastest routes to business ownership and success in the child care industry. That’s because when you purchase a franchise, you receive the whole package of everything you need to start your business and really hit the ground running.
If you’re interested in the daycare business franchise model and want to learn more about this path to business ownership in the child care industry, take a look at this brief guide from our experienced team at Discovery Point.
The Fundamentals of Franchising in the Daycare Business
Before we dive any deeper into what franchising is like in the child care industry, it’s first important to define the franchising concept. A franchise is comprised of two parties – the franchisor and the franchisee. The franchisor is the company that offers an individual, known as the franchisee, the opportunity to do business while using their branding and business model.
In return, the franchisee pays fees to the franchisor, and the two maintain a close, mutually beneficial relationship throughout the life of the business. Franchising is used in all kinds of industries, from fast food to convenience stores, cleaning to retail, and elder care to child care.
When you first started dreaming about becoming a business owner, you may have thought that the only way to do it was to build a business from the ground up on your own. While the idea may have sounded romantic at the time with its promise of freedom, building a successful business from scratch requires a lot of time, and there’s a significant amount of risk involved.
Franchising thus gives entrepreneurs the chance to lower this risk while maintaining a certain degree of autonomy. This is especially beneficial for those who may be new to the industry or are first-time business owners. Rather than having to figure things out as they go, they can have someone who’s done it all before many times over guiding them towards success.
Franchisors provide franchisees with a complete business model, including the systems and equipment required to get started. In the child care industry, this can translate to everything from the construction of the building itself to the playground, curriculum, teacher training, and the fulfillment of licensing requirements.
As a result, franchising saves new business owners time and stress. It enables them to fast forward to their grand opening while skipping over many of the hurdles that would have represented huge setbacks had they tried to do it all on their own.
There’s another benefit to going into business with an experienced franchisor. In addition to having them help you get set up, you’ll also have the advantage of working under their established reputation. In the daycare business, building trust plays a huge role in building a client base. When families already know, recognize, and have faith in your business name, you can look forward to turning a profit much more quickly.
The Process of Purchasing a Daycare Business Franchise
The process of purchasing a child care franchise location differs significantly from the process of opening a daycare business on your own. Here’s a brief breakdown of what you can expect this process to look like and how to prepare for each stage.
Phase 1: Conducting Initial Research on Daycare Business Franchises
The only way to determine the right franchisor to partner with is to do plenty of in-depth research, both about franchise brands in the industry and about your own preferences, values, and priorities. Even after you find a franchise brand that seems to align with your vision, you’ll need to do due diligence to ensure it is a well-established brand with a solid reputation, both within the franchise system and with the general public.
Phase 2: Comprehending the Financial Side of the Franchise
Once you’ve narrowed down the list of franchisors you want to work with, you must understand costs and fees associated with each one. Franchisors often use different fee structures, and these structures can factor into the profitability of your business over time. For example, you’ll need to consider the initial franchise fee, ongoing royalty and advertising fees, and the terms of the agreement to determine whether the franchise model represents a good financial investment for you.
Phase 3: Completing the Franchise Application
When you’re ready to apply to become a franchisee with a specific franchisor, you will need to be prepared to answer a variety of questions. These questions could range from your professional background and what interests you about the franchise brand itself to proof of your financial ability to fund the business. Just as you conducted in-depth research to get to this stage in your decision-making process, the franchisor also has to do its due diligence to make sure you’re the right fit for the brand.
Phase 4: Continuing Your Research at Discovery Day
Your research doesn’t end when you finally submit the application. You can continue to learn more about the brand by attending a Discovery Day. This important meeting will give you the chance to visit some of the brand’s centers, speak with other franchisees, and ask the franchising team questions directly. The goal is for you to have an up-close and personal view of the business before you make any final decisions.
Phase 5: Signing the Agreement and Financing the Business
If the Discovery Day experience convinces both you and the franchisor that you’d make excellent partners, all that’s left for you to do to become a business owner is to sign the agreement and go over the details of financing the business. Once you’ve officially become business partners, you’ll work together to select a site for the center, ensure you’re fully trained in the brand’s systems, and prepare for opening day.
Is Owning a Daycare Business Franchise Right for You?
Franchising isn’t right for everybody. However, for many entrepreneurs, it’s the fastest and easiest way to daycare business ownership. If you’re curious about what owning a franchise with Discovery Point would be like, we encourage you to take a look at A Day in the Life of a Discovery Point Daycare Owner and review some of our testimonials. For a step-by-step look at the process of purchasing and opening a Discovery Point franchise, check out the 10 Steps to Owning a Child Care Franchise.
We would love to fill you in on our current daycare business opportunities and the details of our franchise packages. Just call our franchising team today at 770-623-1140 for more information about becoming a Discovery Point franchisee!