If you operate childcare centres, you’ll already know this. And if you’re looking to buy a childcare business or wondering how to open a childcare centre in Australia, this is something that should be top of mind…the care and education of those little tackers is the most important part of your business. This means that things like the business’s finance and compliance requirements can often take a back seat, which can create a stress snowball for any business owner.
But there are other sector-specific issues we see coming up again and again. Let’s take a look at some of the challenges of running a childcare centre, and some easy changes you can make in your business to dial up the profit and dial down the stress.
Why Owning a Childcare Business is Challenging
While running a childcare centre can be tough, it’s often a more profitable endeavour compared to the average Australian small business. This is great news! In our experience servicing clients in the childcare sector, we see net profits averaging from 12.5% to 15% per annum.
But, it’s also a sector that is heavily regulated. Operators need to satisfy specific operational requirements under the National Quality Standards around educational programs, building standards, physical environments, staffing plus policies, procedures and record keeping .
There’s also the matter of State and Federal Government approvals and compliance. In Australia, early childhood education and care providers must be approved to operate in their state or territory and be approved by the Australian Government to administer the Child Care Subsidy (CCS).
Ensure Financial Success in the Growing Childcare Industry
Running a childcare business is no walk in the park. With more mums heading back to work and government incentives boosting demand, the competition in the industry is hotter than ever. Not only that, but profit margins are shrinking too. It's no wonder why childcare business owners are facing some new and unique challenges! With so many operational and compliance issues to manage, it's important to make sure the financial side of the business gets proper attention.
But where do you turn when you don't have enough scale to get a Chief Financial Officer (CFO) with an in-house finance team? The answer might be outsourcing your finance function, including virtual CFO services, bookkeeping and payroll services.
5 Reasons Outsourcing Financial Services Makes Sense for Childcare Business Owners
- Cost savings: Outsourcing can save money compared to hiring a full-time employee to handle financial tasks.
- Expertise: An outsourced financial services provider will typically have more experience and specialized knowledge in areas such as accounting and taxes, which can help ensure that the business is complying with all relevant laws and regulations.
- Time savings: By outsourcing financial tasks, business owners can free up time to focus on running and growing their business.
- Flexibility: Outsourcing can provide flexibility in terms of the services provided, the level of involvement of the provider, and the duration of the relationship.
- Scalability: Outsourcing allows the business to scale up or down the financial services it requires based on the growth of the business.
What is a Virtual CFO?
In the same way an experienced CFO operates, a Virtual CFO subscription ensures the financial performance of your business always tracks in the right direction.
A CFO is vital to any business as they assist with the collation, preparation and analysis of data in a timely manner in order to assist the owner in making relevant and reliable financial decisions. A virtual CFO can assist with the following important facets of your business.
Planning
Preparation of an annual strategic plan to determine the course of your business by identifying opportunities to capitalise on as well as mitigating possible threats or weaknesses.
Forecasting
A budget is a roadmap of how you’re going to achieve your strategic plan. It sets out the course of action required to deliver the desired result. We will partner with you to create the annual budget including mapping out all important cash flow cash flow of your business.
Reporting
Relevant, reliable and timely information forms the cornerstone of any sound business decision. We would utilise the key metrics identified in your strategic plan to determine a reporting structure.
Monthly Meetings & Support
By meeting on a monthly basis we play an active role in ensuring you are on track to deliver the key goals identified in your strategic plan. The periodical meeting process enables you to be held accountable to the important metrics of your business.
Learn the Benefits of Outsourced Bookkeeping
It’s essential for business owners to get bookkeeping right if you’re to make sound business decisions based on timely and accurate information. So it makes sense to bring in a dedicated bookkeeping team who can manage your day-to-day record keeping with their eyes closed while you keep your eyes on the prize.
A great bookkeeping team can assist businesses of all sizes from many different industries. Usually, the only requirement is that you’re looking for bookkeeping efficiency across one or many of the following service areas:
Monthly Bookkeeping Services
Make sure your books and business financial records are tax compliant and always up to date. There are two things we can guarantee about your business: you earn money and you spend it. Outsourcing to skilled and experienced bookkeepers helps you keep track of all that.
Convert Your Books to Xero or get a Xero Health Check
Moving your books to Xero is a brilliant decision for any business. Outsourcing the set up will ensure a seamless migration of your business finances to a fully digital, cloud-based bookkeeping system that makes keeping your books a breeze.
Already a Xero user? With a dedicated bookkeeping team by your side, a Xero Health Check is a simple process that includes a thorough examination of your Xero file to keep your books fighting fit. Our Xero specialists are trained to look for errors and inconsistencies, and to recommend ways to improve the function of your Xero file, making your ongoing bookkeeping quicker and more accurate.
Free Up Time and Reduce Risk by Outsourcing Payroll
You don’t open a childcare centre to run payroll. Outsourcing this crucial business function can reduce risk and stress for business owners, while increasing trust with your staff and giving you back time to spend in other areas.
Manage all your payroll admin in one place. Seamlessly onboard and offboard people, ensure staff are paid correctly, approve leave and reimbursements, set up salary sacrifices and monitor check-in and check-out times with face ID. Our packages are complete payroll solutions that are cloud based, compliant, cost effective and tailored to businesses of all sizes.
Choose BlueRock To Help Your Childcare Business Grow
BlueRock is the partner you need for your childcare centre business to allow you to focus your time on educating the kids, while helping you run the financial side of things through the use of Virtual CFO, Bookkeeping, Payroll and more. You’ll save time while ensuring compliance with the National Quality Standards, the ATO and the minefield that is employee salaries under ever-changing and complex award rates. Get in touch with our team to discuss how BlueRock can help your childcare business thrive in the face of any challenge.
Introducing BlueRock On Demand. Subscription Services For Busy Childcare Business Owners
Combine BlueRock’s expert advisors with technology-led solutions and what do you get? Accurate bookkeeping, smart financial reporting, trusted payroll, and fixed-fee business services, delivered as simple monthly subscriptions. That’s BlueRock On Demand . With our flexible and transparent solutions, your business can benefit from increased compliance with legislation, accurate bookkeeping, efficient payroll, effective HR and minimised taxes.
