Shelter in place/stay at home orders due to COVID-19 have resulted in an unstable time for everyone – not least of all, childcare providers who rely on tuition payments from families to ensure the stability of their businesses. Losing families who are unenrolling because children cannot attend your program or because you need to temporarily close for health reasons can create a very real financial instability for your program, which can feel very scary.
At the same time, many families are also struggling. Some have lost jobs, and those who are working and taking care of their children are struggling to figure out how to balance both of these major efforts. Because this may be the new reality for the time being,, Wonderschool has put together a list of options that some programs are using to help retain enrolled families so that when programs can reopen, there are families ready to use them.
Think of it as a spectrum of actions you can take while your program is temporarily closed: on one end, you may decide to unenroll or pause families and not collect tuition; on the other end, you may decide to charge full tuition. In between those two options there are many additional ways to work with families during this time.
One way to approach it: figure out your current operating expenses. Are you continuing to pay your teachers? Do you have rent or a mortgage that you need to pay with a portion of your business revenue (i.e., your tuition payments)? It is safe to assume your expenses have gone down at least moderately, as you are not likely purchasing food for children or materials when they aren’t attending. If you’re spending 50% less than normal right now, you could offer to only charge families 50% of the normal tuition amount. Let them know how and why you came to this decision, and that being able to maintain basic business operations will allow you to open up again as fast as possible once it’s safe to do so.
Another way to approach it: offer a flat rate discount (any % discount) simply to offset the fee parents are paying.
Ask parents to contribute a donation to help keep the program operating, rather than charging full tuition.
Future tuition credit
Ask families to continue to pay tuition now, but let them know you’ll apply a future credit (discount) to their account when things get back to normal and your program restarts. This can be a way to offset losing a mass amount of tuition now, if you are still successfully charging your families.
Rather than completely unenrolling a family, you can simply pause their enrollment which stops tuition payments until you open again.
Apply for federal or local assistance
If you’ve furloughed (stopped their work but plan to bring them back later on) or laid off (permanently ended their employment) your staff, they are eligible to apply for unemployment benefits. If your income has dropped due to COVID-19 you are also eligible to apply as a sole proprietor.
If your staff are still on payroll, and even if you don’t have staff, the SBA has launched a grant/loan program for small businesses to help protect payroll and basic operating expenses. If granted a loan, in theory you would not need to continue to charge families tuition (or as much tuition), or it could help offset revenue lost by families who may have already unrolled. You can find the SBA Coronavirus Relief Options here: https://www.sba.gov/funding-programs/loans/coronavirus-relief-options
Check your state and local resources for other grants or financial assistance programs. You can Google “small business loan [your city or state] covid” and see what you can find.
Offer virtual learning opportunities
For parents who are still paying but keeping their children at home (whether or not your program is officially open), you can offer virtual or remote learning opportunities, such as a daily morning circle over Zoom, individual FaceTime check-ins, or weekly emails with learning activity ideas. Here are some resources:
Want to connect with other providers to learn more about how they are managing this time? Join Wonderschool today!