Reply to If your daycare or childcare provider closed due to coronavirus, are they still requiring you to pay

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[quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous]We've been asked to pay 90% of tuition for April, which we'll do. Hoping that things will become more normal in May.[/quote]

Woah!!!

Seriously, glad you got it like that! Only 10% off? Why even bother?[/quote]

Sounds like that center is still paying their staff and their landlord, and the expenses that they are no longer having while closed (catering, etc) amount to about 10% of the total, so they are doing the right thing by passing those savings on to their clients. The words you are looking for are "thank you".
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That leaves the owner still making 100% of his normal profit.  Somehow it seems right for her to also be taking a big haircut.  And that assumes that no effort has been made to work out somewhat of a deal with the landlord, who has a strong incentive to not have a tenant leave in the current economic climate.

Why exactly should the parents, many of who may have precarious job positions, be the only ones to be sacrificing here?[/quote]

LOL that you think any daycare is ever making a profit. Seriously lolololol. Huge chains excepted, but seriously, your statement just shows how clueless you are. Just because the monthly bill for you is big doesn’t mean anyone’s getting rich. [/quote]

Of course daycares are making a profit.  How do you think they stay in business if they are not?  And many of the “huge chains” are franchises, meaning that the local owner has to pay an additional fee to corporate.  Even non-franchises have greater central overhead expenses, so I wouldn’t assume that corporate centers necessarily make more than a well run local center.

Even if owners are not “getting rich,” they are owners of profitable businesses that should be expected to share in the pain of the current crisis.  As should their landlords.

It’s crazy that you think the parents, most of whom are also “not rich,” should be the only ones sacrificing here.
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You’re just totally wrong. I’ve directed three well regarded NAEYC accredited centers, and whatever “profit” you think these places are making is non-existent. Sometimes there’s a good year—100% enrollment, all tuition paid on time, maybe a small grant or two—and we could put some in reserves. Others we ended in the red and used those reserves. Most usually we just had exactly as much coming in as going out. [/quote]

It sounds like your centers may have been non-profits.

Does/did your centers charge lower tuition than other comparable for-profit centers?  Were your expenses higher than expenses for other comparable centers?

If not, presumably you should have a similar amount of money left over at the end of the month as any other center.  What was done with that money?

When I searched for daycares, it seemed like both the for profit and non-profit centers all charged essentially the same tuition.  And they all seemed to provide the same services.  There was nothing that I could see that would have made me assume that the costs to run the non-profits would have been higher.  So I don't understand why the economics of the two would be significantly different.  Can you explain?  [/quote]

There’s an entire literature on the instability of the child care “system.” Take some time to educate yourself if you’re truly interested in understanding.

For starters, here’s a sobering survey that came out this week—responses from 6,000 programs.

https://www.naeyc.org/sites/default/files/globally-shared/downloads/PDFs/our-work/public-policy-advocacy/effects_of_coronavirus_on_child_care.final.pdf
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Why didn’t you answer the questions raised?

The survey you sent doesn’t address normal operations.  Rather, it is the centers’ own responses to a survey put out by their association to argue for both support from parents and the government in light of this crisis.  That’s not exactly objective data or presented from an unbiased source.[/quote]

Because your assumptions are wrong and I’m not your personal teacher. I’ve explained that in my experience (running three high-quality programs, often cited on this board as “top of the line”) and for the vast majority of regular joe programs, revenue=expenses. There simply is no money left over. If you truly want to understand, there are thousands of resources. [/quote]

Yes, I am sure your trade association has put out other resources.

It's simple logic.  There are many, many for profit daycare centers.  They would not stay in business unless there was "money left over" -- that's just common sense that they wouldn't continue to operate and proliferate if they weren't making money.

It appears that non-profit centers charge the same tuition (therefore have the same revenue) and have the same expenses (they operate in similar buildings, provide similar programs, etc.).  If that is true, there should be the same "money left over," whether you call it profit or not.

That is why I asked whether it was accurate that non-profits tended to have comparable revenue and expenses to for-profit centers.  You didn't answer that.  If non-profits charged lower tuition, then it would explain why there may not be money left over.  If they had higher expenses, the same could apply.

Maybe there is something different about non-profit centers -- again, that's why I asked.

But, if you are claiming that there is "nothing left over" even at for-profit centers, that is simply not plausible as businesses do not continue and expand if they are not profitable.
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