We share some pragmatic information on what it takes to start an after school program.
After-School Industry Overview
Nearly half of all households in the U.S. are dual income homes. Unless there are extended family willing to fill the void, that leaves many parents unable to provide after-school care for their kids, and creates opportunities for entrepreneurs in the after-school and wrap-around childcare sector.
Most after-school programs work cooperatively with local schools for busing and other activities. Although some provide before-school services, the majority focus on providing supervision, tutoring and play options for school-aged children from the time school is out until pick up.
Startup Formats for After-School Programs
There is strong demand for quality after-school programs in the U.S. But the sheer quantity of after-school care providers can make it difficult for startup entrepreneurs to get on their feet.
As you begin to consider how you will differentiate your after-school program in a crowded marketplace, you'll also need to consider the type of after-school program you will launch.
- For-Profit After-School Businesses. For-profit after-school operations are privately owned companies. Although they can be operated out of a home, best-in-breed after-school businesses are located in storefronts and facilities that are centrally located, safety compliant and have been outfitted to attract a steady customer base.
- Nonprofit After-School Programs. Many after-school programs launch as nonprofit organizations. The primary difference between nonprofit programs and for-profit businesses is that the organization isn't owned -- it exists as an independent entity. The after-school leader and staff are paid salaries, but no one has an ownership stake in the program or its assets. Both for-profit and nonprofit after-school programs charge fees for service. However, nonprofit programs may also qualify for government and foundation grants, and may experience a greater level of cooperation from the local nonprofit/educational community.
Best Practices: Business Plans for After School Programs
Struggling to get the attention of lenders and investors? Maybe it's because you're lacking a high quality business plan.
Business plans address a wide range of issues, including startup financials. The financial chapter of your business plan is one of the first places investors and lenders look, so it needs to contain forecasts and budgets that are rooted in business realities rather than your personal best case scenario.
Subsequently, a thorough understanding of business plan financial basics is a prerequisite to effective business plan writing for after school programs.
Selecting a Location
Most after school programs sell primarily to local customers. As an aspiring entrepreneur, the most important advice we can give you is to avoid investing in an underperforming, unprofitable location. Knowing what to look for in a location when you start a business is more important than most new entrepreneurs realize.
Long before you open an after school program in your area, it's a good idea to see how many competitors you have. Use the link below to find competitors in your city. After clicking on the link, type in your city, state and zip code to get a list of after school programs near you.
Prior to opening your doors for business, be sure you fully understand the competitive landscape and where your new business will fit in.
Turning Competitors Into Collaborators
After you've evaluated your local competitors, the next step is to have a conversation with someone who is in the business. If you think owners of nearby after school programs will give you advice, think again. Why would they want to educate a future competitor?
Thankfully, an owner of a an after school program in another town may be more than happy to give you a few tips, after they realize you reside far away from them and won't be stealing their local customers. In that case, the business owner may be more than happy to discuss the industry with you. If you are persistent, you can find a business mentor who is willing to help you out.
Where do you find an entrepreneur who is running an after school program in another community?
It's easy. Here's a link you can use to find a mentor outside of your area.
Financial Benefits of Buying an After School Program
Startup after school programs carry a host of financial risks and concerns. Without an operational history, it's hard to predict how your startup will actually perform in the marketplace.
Although there are many benefits to buying an existing after school program, the financial advantages rank near the top of the list. Established after school programs have reliable revenue streams and loyal customer bases – both of which will shape your company's financial landscape.
Based on the acquisition target's financial records, you should be able to piece together a realistic forecast of your new company's financial picture for the first year and beyond. If you need assistance, we suggest talking to an accountant or professional business planning consultant.
Don't Forget About Franchising As an Option
The odds of achieving your primary goal of doing well in business are substantially improved if you decide to franchise rather than going it alone.
If you are thinking about opening an after school program, you would be wise to check out whether purchasing a franchise might make sense for you.
The link below gives you access to our franchise directory so you can see if there's a franchise opportunity for you. You might even find something that points you in a completely different direction.
These additional resources regarding getting started as an entrepreneur may be of interest to you.
If you currently own an after school program, these resources will come in handy:
If you came here to learn about selling to after school programs, you're in the wrong place. These resources are more appropriate for you:
If you are interested in starting a different kind of business, please browse our directory of guides below.