Caring Hands Academy Ltd. is planned to be a limited liability company that will offer day care services for children of up to two years of age. It is to be a round-the-clock service that will provide children with three meals a day. Qualified personnel will offer care, medical and educational services. The unique aspect of the service will be the inclusion of diapers and baby wipes in the tuition fee, which no other known day care currently provides. The company’s main objective will be to set a solid foundation for future society leaders, with our mission statement being “Solid foundations of a great future”.
The day care industry is populated with average quality institutions which usually lack highly trained personnel. They are getting better with time, but are facing competition from workplaces that are increasingly providing in-house day care services for their employees. As the importance of a person’s childhood is becoming better understood among the general populace, so does the demand for quality day care increase.
The company pursues to position itself as a quality day care that knows its job and does it without breaking the customer’s bank. We plan to leverage on our professionals’ high qualifications by displaying their certificates and awards prominently around the facility. We will also strongly leverage word-of-mouth advertising by ensuring that our customer care goes beyond the ordinary, seeing as this type of marketing is the most powerful.
The company plans to start off with one facility that will have playrooms, a changing room, and a health room on site. Present will be a registered nurse and three instructors certified in CPR. Spanish and computer courses will be included in course schedule. Operations will run at all hours, every day of the week. The projected capital requirements are US$ 133,000, sufficient for set up and operations for 6 months without factoring in revenue. Break-even point is projected to be at 22 months, and a ROI of 68% per annum.
The company will target middle-income entrepreneur single mothers and mothers that work night shifts. This target segment has been selected to counter the competition of day care provisions at the workplace for mothers working regular day jobs. Entrepreneur mothers are unable to take advantage of this. The unpredictable nature of business schedules may also mean that they may sometimes require their children to remain at day care into the night and weekends. Night shift working single mothers face little to no access to child night care services. Caring Hands seeks to take advantage of these two niche markets by offering round-the-clock services.
It also seeks to unburden the target customers of the need to worry about diapers and wipes, and allow them to concentrate on their jobs. We plan to give customers peace of mind by assuring them of our staff’s high qualifications. Pricing will be above industry average. This will allow us to offer more to the child and require less of the parent when the child is taken home. We will seek to show parents that the extra expense saves them money elsewhere while guaranteeing quality service.
Caring Hands will face a number of risks. First is the threat of a contracting middle class; the general trend in the U.S is an expanding lower and upper class, at the sacrifice of the middle. This means that potential customers are currently falling into the bracket of not capable of affording day care, or rising to the bracket of being able to afford a nanny. This trend erodes Caring Hands’ customer base and may mean slow growth if it proceeds.
A second risk is the challenging economic times, which presents two main challenges. First is the failure of small businesses due to lack of credit and contracting market bases. As banks lend less, single mother entrepreneurs may find it difficult to continue operating their businesses or to save enough to afford day care. They may opt to take up jobs, and they are likely to land in medium-sized to large corporations which offer day care services and may therefore not need Caring Hands’ services. This will erode our customer base. The second challenge presented by a tough economy will be the difficulty in raising capital for starting up the company, with banks likely to shy away and friends and family with diminished savings unable to help with raising the start-up capital.
Total Investment Required: US$133,000
Investment Available from savings: US$ 11,000
Additional Investment Required: US$ 122,000
Revenue: Projected to total US$ 341,208 by the end of the first year of operation.
Break-even point: at 18 months from commencement of operations
Return on Investment: 68% ROI from the 3rd year of operations
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