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Child Care Services Business Plan

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Product Description

Hiring a babysitter can quickly become a hassle that is too expensive or too time-consuming to bother with. Boston is the third most expensive city to hire a babysitter, behind San Francisco and San Jose, CA. Many parents are moving away from hiring a babysitter because it is too stressful to find one they like. Care.com, a frequently used babysitting search engine, conducted a survey that revealed that 51% of parents are more likely not to hire a babysitter because it is “too stressful to find someone they like” and 57% of parents will not hire a sitter because “it costs too much.” Additionally, parents are less likely to hire a babysitter if they are young, inexperienced teens and are willing to pay more if they pay for a professional. It is essential to make sure your children are in the right hands no matter where they are, which is why we have created a child care service that will instill a positive level of reassurance in the minds of parents while giving them time to enjoy time to shop for themselves. Luckily, TJX Tots does all of this.Child Care Services Business Plan

Our product is a child care service that enables parents to prolong their shopping experience while their children are under the care of TJX approved caregivers in-house. We are professionally staffed, come in cheaper than hiring a babysitter, and are conveniently located right inside the store. The center will be located next to the bathrooms in selected TJ Maxx stores; it will be small enough as not to disturb the flexible model of the store, and everything inside will be portable so that if needed, any of the materials inside the daycare could be moved out and space could be repurposed. Our service will include healthy snacks and beverages, toys, and educational activities such as games, building blocks, and art projects geared towards specific age ranges. Our goal is to have a child care service that can provide entertainment for children ages 3-10. 

We will have two professional, paid employees per store who have significant experience in child care in a wide range of ages. These employees may be able to switch shifts depending on the day of the week and time. Based on our research and speculation, many mothers will not bring their kids to shop unless it is a weekend or later in the day after picking their children up from school. So, during the early mornings or days, we may only need one employee working. The legal ratio is ten children per one worker, and we will ensure that this ratio is consistently met. We will also have a rotation of interns/volunteers that we will work with. They will be over 21 years of age and need prior experience with babysitting and a background check. Most of our interns will be students studying education and looking for further understanding to put on their resumes to assist in the job search post-graduation.

In summary, TJX Tots strives to create a safe, fun, and educationally driven environment for children ages 3-10. We strive to protect and promote the well-being of children while their parent’s shop, creating a calm atmosphere for shoppers and a pleasurable experience for young children who may otherwise not want to go out and about with their parents.

Safety Precautions

A prerequisite to working with TJX Tots is to be CPR and First Aid certified, and if they are selected as employees, they will then go through a state background check.

When the parents are checking their children into the TJX Tots Room, they will sign their child in on a form, which also has a written liabilities waiver on it, and provide a photo ID. Each parent will receive a numbered tag, one tag per child, which will correspond with the number on the form, and to pick up their child, they will have to return the plastic number. If the parent loses the number, they will be asked to provide photo identification before leaving with their child.  

Legal Regulations

State law imposes several requirements we must fulfill as a child care service provider. We are required to maintain a minimum provider/child ratio of 1:10. We must have a head administrator present at all times, who must be at least 21 years old and have a Massachusetts Early Childhood Administration Credential. We are also legally obligated to provide a comfortable amount of space for the children, and the meals must be healthy and nutritious. The equipment must be clean and hazard-free. Also, parents have the right to enter the center at any time while their child is present to confirm their child’s well-being. We will strive to go beyond fulfilling all of these requirements in the design and implementation of our service.

Environment and Layout

The care facility will be wholly child-proofed and cleaned daily to ensure the health and safety of the children and our staff. We will provide no sharp edges, hazardous liquids, or cleaning materials accessible to the children. There will be locks on all of the cabinets in the room that each employee, and only the employees, will have access to. The colors in the room will be catered to the emotions that these colors provoke. Color psychology is a significant player in the behaviors of humans and is an essential factor to think about when designing a room. Our room in the TJ Maxx stores will feature three-light orange walls and one wall with a Plexiglas window.

We chose the color orange because it is ultimately the most positive; it evokes happiness, enthusiasm, and excitement. We chose Plexiglas for multiple reasons:

  • It is more transparent than glass, allowing parents to see their children better. The regular glass allows 80% of light to pass through it, while Plexiglas allows 90% of light to pass.
  • Plexiglas does not shatter as easily as regular glass, so in the unfortunate event that one of the children runs into the window, it will not break or be as rough to run into as glass. Additionally, the room will be fully stocked with child-safe hand wipes and hand sanitizer dispensers on the walls.

Prerequisites for Children

Children must be between the ages of 3 and 10 and must be toilet trained. All allergies (i.e., food, latex, etc.) must be verbally disclosed to the TJX Tots employees and written on the waiver before the parent leaves the child in our care.

Activities

We like to focus on fun with an educational element to our service, which means our actions will be geared towards this with the children. We will have activities such as painting, building blocks, puzzles, and an assortment of books for the children to choose from, depending on how much time they will be spending with us. Learning through play is an essential element in a child’s development, and we want to promote this idea. An example of this learning through play is the educational benefit of building blocks: when a child plays with blocks they are learning spatial reasoning, comparing different lengths and widths, and if they are building with other children, they can discuss what they are making, and problem solves through trial and error.

Mission Statement

Promoting children’s safety, fun, education, and a pleasurable shopping experience for customers.

Value Proposition

Peace of mind is a value we share with you, parents. We understand the hesitation parents have to leave their children alone, whether at home or in our store. This is why we have taken a unique approach to our service by considering every possible safety precaution before accepting other people’s children into our care. We see great value in granting parents this time to relax and shop in correlation with not leaving their children at home, seeing them if they want to, and knowing that they are safe and having fun. We have also taken an unconventional route to our babysitting service by adding an educational element to our plan, implementing enriching value behind every activity we have for children.

Our service contributes to improving the quality of shopping and saving customers time. Parents are usually attentive to their children’s needs; if their children are hungry, tired, or over-excited, it makes the parents unable to shop without distraction. Our service focuses on easing the stress on parents while they shop, which will improve their shopping efficiency and experience. At the same time, our service will forge a high-quality shopping environment by separating the external noise of children from all customers. Little children are cute, but when they are crying or howling around people shopping, they disrupt the pleasant shopping experience. Our service will assist in remedying this situation.

Financial Benefit

Our service is beneficial for parents because it will be cheaper than hiring a babysitter. We will charge a flat rate of $13 per child. This is based on a survey we conducted in which our responses revealed that most people would pay between $11 and $20 for a service like this. Additionally, since the average hourly rate for a babysitter is $13.33 nationally and $15.37 in the Boston area, we are giving ourselves a competitive edge being below these rates. The average amount of time Americans spend shopping per day is about 42 minutes, so we are coming just under an hour. Our prices fall under an hourly rate, making our service more financially sensible than hiring a babysitter.

With TJX Tots, we aim to increase sales by 3 to 5 percent. According to the U.S. demographic census, 19.93 percent of the population are females between ages 25 and 54. Between this range, 52.4 percent of them have children, and 24.31 percent have children between the ages of 3 and 10. This means, 3.44 percent of the population matches our service condition.

The breakdown: 71%19.93%24.31% = 3.44%

Percentage of U.S. Population Middle and high income people Females who are 25-54 years of age
71 19.93
Have children 74  

52.4

Have children whose age is between 3 and 10             

  36

 

24.31

More specifically, according to U.S. demographic census, 20.79 percent of population in Massachusetts are females between the ages 25 and 54 and 55.2 percent of them have children. 26 percent of these women have children between the ages 3 and 10. So, 4.78 percent of the population in Massachusetts match our service condition. These calculations are what lead us to the assumption that we will be able to increase sales by 3-5%.

The breakdown: 88.5%20.79%26% =4.78%

Percentage in Massachusetts Population Middle and high income people Female who are 25-54
88.5 20.79
Have children

 

75 55.2
Have children whorse age is between 3 and 10 38.5 26

Industry Description

Since we are working within TJ Maxx stores, we are working within the retail industry. However, we can more closely identify with the child care services industry, which has been steadily growing throughout recent years. This figure shows two trends in the childcare industry, a growing sales percent change, and net profit market. Although percentages did decline in some years, the critical aspect to note is that all of these percentages are positive, meaning there has consistently been some growth from year to year. This is a fantastic chance for us to get into the market and benefit from the increasing profitability of these facilities.

Trands for chlid day care services

Based on the information we noted from a very well article on top trends in the childcare industry, parents are more cost-conscious when selecting a childcare service. They are not interested in paying hefty fees for daycare. They have even been more inclined to reduce their children’s hours in daycare or even pull them out altogether. The article highlights an increase in demand for “drop-in” child care, which is precisely what we are offering at TJX Tots. Parents are also much more interested in services that will take care of children and emphasize education or incorporate educational elements into their model. We at TJX Tots are significant believers in the importance of education in young children. Even for short amounts of time, children should be able to learn a valuable lesson through play or discussion. Many businesses and other establishments such as churches and schools are beginning to find that implementing “parent’s night out” programs that allow parents to bring their children for a few hours to spend some time alone together are becoming profitable. TJX Tots wants to capitalize on this growing trend in the market. Through our low-cost service, we can serve as the answer to many parents’ demands for an effective service that will not inconvenience their day-to-day life and be a positive experience for their children.

The U.S. Bureau of Labor Statistics in their 2010-2020 “Employment and Output Projects to 2020” listed child care services, which falls into the category of health and social assistance, as one of the industries with the most significant growth rate projections for the years 2010-2020. In terms of employment and wage and salary growth, the industry projects to move from 851.8 thousand jobs in 2012 to over 1 million jobs in 2020 with an expected growth rate of 2.6% annually until 2020. According to Forbes article: “Growth in U.S. Day Care Business,” sales between private firms that offer child care services saw 9% annual growth in 2014 and a 6-7% increase in sales annually between 2008 and 2012 with gross margins averaging around 96%. This industry also did not see any drops in sales or growth during the recession, unlike other service industries, which saw declines of 5% or more during this time. This proves that child care is a stable, growing industry with potential for high profits and expansion.  

A college grad analysis of the daycare industry highlights the personal reward many industry professionals get from working in a positive, educational environment for young children. This could be a potential benefit for TJX Tots because we are promoting education through play and offering a great learning experience for students studying education to volunteer with us and gain the knowledge they may need to get a job in this market later.

For older children, many parents rely on aftercare programs offered by schools, and this industry has been on the decline recently, which is detrimental to parents who work and cannot get their children in time. Many after-school care services will charge a fee for aftercare and then increase the price for every additional 30 minutes or hour the parent is late picking up their child. Research done by The After school Alliance found that there are 8.4 million children currently enrolled in after-school care programs. Still, there is a need for these programs for approximately 15 million more children nationwide, leaving a massive gap in this industry. Additionally, many children do not benefit from being in after-school care programs if the program does not promote positivity with solid supervision.

Based on the information we noted from a very well article on top trends in the childcare industry, parents are more cost-conscious when selecting a childcare service. They are not interested in paying hefty fees for daycare. They have even been more inclined to reduce their children’s hours in daycare or even pull them out altogether. The article highlights an increase in demand for “drop-in” child care, which is precisely what we are offering at TJX Tots. Parents are also much more interested in services that will take care of children and emphasize education or incorporate educational elements into their model. We at TJX Tots are significant believers in the importance of education in young children. Even for short amounts of time, children should be able to learn a valuable lesson through play or discussion. Many businesses and other establishments such as churches and schools are beginning to find that implementing “parent’s night out” programs that allow parents to bring their children for a few hours to spend some time alone together are becoming profitable. TJX Tots wants to capitalize on this growing trend in the market. Through our low-cost service, we can serve as the answer to many parents’ demands for an effective service that will not inconvenience their day-to-day life and be a positive experience for their children.

The U.S. Bureau of Labor Statistics in their 2010-2020 “Employment and Output Projects to 2020” listed child care services, which falls into the category of health and social assistance, as one of the industries with the most significant growth rate projections for the years 2010-2020. In terms of employment and wage and salary growth, the industry projects to move from 851.8 thousand jobs in 2012 to over 1 million jobs in 2020 with an expected growth rate of 2.6% annually until 2020. According to Forbes article: “Growth in U.S. Day Care Business,” sales between private firms that offer child care services saw 9% annual growth in 2014 and a 6-7% increase in sales annually between 2008 and 2012 with gross margins averaging around 96%. This industry also did not see any drops in sales or growth during the recession, unlike other service industries, which saw declines of 5% or more during this time. This proves that child care is a stable, growing industry with potential for high profits and expansion.  

A college grad analysis of the daycare industry highlights the personal reward many industry professionals get from working in a positive, educational environment for young children. This could be a potential benefit for TJX Tots because we are promoting education through play and offering a great learning experience for students studying education to volunteer with us and gain the knowledge they may need to get a job in this market later.

For older children, many parents rely on aftercare programs offered by schools, and this industry has been on the decline recently, which is detrimental to parents who work and cannot get their children in time. Many after-school care services will charge a fee for aftercare and then increase the price for every additional 30 minutes or hour the parent is late picking up their child. Research done by The Afterschool Alliance found that there are 8.4 million children currently enrolled in after-school care programs. Still, there is a need for these programs for approximately 15 million more children nationwide, leaving a massive gap in this industry. Additionally, many children do not benefit from being in after-school care programs if the program does not promote positivity with solid supervision.

Target Market

We are targeting the relatively same market as TJX. However, our niche is parents with children, particularly mothers who already shop in TJ Maxx. We intend to start in three stores in, particularly family-friendly neighborhoods in the Boston area. The company’s “core customer” has the following characteristics: female, between 25-54 years old, middle to upper-middle income, fashion and value-conscious, and finally someone that “shops high-end and moderate department/specialty stores and online,” or someone without much brand loyalty that is willing to hunt for deals. 

This last characteristic is critical because a customer who enjoys “treasure hunting” for bargains will be affected most by a complaining child wishing to end the shopping trip prematurely. We are aiming at mothers that have at least one child between the ages of 3 and 10. Overall, our target customer is a fashion and deal-savvy mother of young children who takes her shopping experience seriously but does not always have the time to do so because of her kids. 

Responses

Market Segmentation  

When designing a childcare service such as ours, it is essential to remember the key reasons people, families, particularly, move to a place. Key reasons maybe the school district, neighborhood safety, and the number of other families in the area. We have found three neighborhoods with high percentages of families and are known to be family-friendly areas with many children: Dorchester, Newton, and Cambridge. The more children in the surrounding areas of the TJ Maxx stores we select, the more possibility there is for increased business and the success of our service.

Geographic

Boston, Massachusetts, U.S. The specific areas and store locations we have chosen are:

  • Dorchester (The TJ Maxx at South Bay Center, 8 B Allstate Road)
  • Newton (The TJ Maxx at 260 Needham St) and 
  • Cambridge (The TJ Maxx at Fresh Pond Mall, 198 Alewife Brook Pkwy)  

Demographic

Mothers aged 25-54 years old have one or more children between 3 and 10. We see the average household income of people willing to use our service falling between $50,000-$80,000/year.

Psychographic

We know that the TJX brand targets women who, naturally, like to shop. Our target mothers will lead a fast-paced lifestyle and value spending time with her family, meaning she would rather keep her children with her while she shops and still allow them to have a fun experience with our TJX Tots caregivers. In contrast, she has her enjoyable experience shopping for herself or her family.

Behavioral

We hope that the mothers that come into the store fall in line with the essential TJX value of enjoying the “treasure hunt experience” of shopping. She will need to frequent the store, and with this, it will mean not having much brand loyalty. These mothers will be time and money conscious, not want to worry about hiring or paying for a babysitter that could be inexperienced, and

The Numbers

Our market segment is the households with children in our selected neighborhoods: Newton (69.78% of all households are families, 12.4% children ages 1-9), Cambridge (10.3% of all households are families), and Dorchester (55.8% of all households are families).

The size of our specific market is 67 201.78 and can be broken down as:

Dorchester: 34,602, Newton: 21,703, Cambridge: 10,896.

Competition

The most relevant example of a competitor with service much like ours is IKEA. They have a daycare center located in their stores called Smaland. Smaland has a Swedish forest atmosphere and is a place where kids can play and are cared for while the parents can enjoy their shopping experience. Even though parents are paying for our service, they know where their child is, the caregivers they are with and see that they are still getting a better deal than they would be if they were hiring a sitter at home. However, this service occurs within IKEA stores while ours is within TJX locations, which sell different products and cater to separate customers. Therefore, technically we are not in direct competition with IKEA because we are not fighting for the same customers. Yet the service IKEA provides is the closest thing to what we’re aiming to do, so it’s beneficial for us to examine them and improve upon what they do.

Now let’s compare ourselves to our closest competitors, traditional babysitters. Usually, parents would have to drive to the babysitter’s house or come to their house, which takes time. By having the service right in the store, we eliminate this time gap. To drop your child off right inside our TJ Maxx store is very convenient for parents. We also feel that our product is also more convenient than having a babysitter. Rather than paying a steep hourly rate for a babysitter, mothers can come to TJ Maxx with their child and spend less money to drop them off for however long they want to shop. An increasing number of parents are worried about their kids and how they will keep busy or remain healthy at these daycare centers or other options. At TJX Tots, we will have a variety of healthy foods and snacks for the children. They will have many activities and toys to play with to keep them busy and happy while in our center.

We also must consider the model of paid daycare services or after-school care programs for older children. These would-be competitors to us because they are doing the same thing we do. Day Care services are expensive, but they operate throughout the workday or longer, which many parents are looking for. According to the Boston Magazine article: “Infant Care Costs More Than College Tuition,” childcare for a child four years old costs about $13,000 per year per child, which is about 15.3% higher than the average rent U.S.

SWOT Analysis – TJX Tots

Strengths

●       Located directly within the store.

●       Price is less than average hourly rate of babysitters.

Weaknesses

●       No brand recognition because we are just starting out.

●       Only three locations to start out.

Opportunities

●       Possibility to expand into additional stores

●       We could expand into other types of stores.

●       We could incorporate an online element in the future, which would let us advertise more effectively and allow parents to book appointments in advance.

Threats

●       If we catch on others could try to copy us.

●       If TJX sales slow, so do ours.

SWOT Analysis – Traditional Babysitters

Strengths

●       Child will be watched individually or with your other children

●       Can be flexible with pick up/ drop off times

●       Located in all cities across the country.

Weaknesses

●       More expensive than our service.

●       Parents must drive to the babysitter’s house or have them come to their house.

●       No brand recognition.

Opportunities

●       Build a strong consistent relationship with an individual you can trust

●       Could develop an online presence for advertisement and appointment booking.

Threats

●       Traditional babysitters are many families go to, it’s all they know

●       In-store services like ours that could take away business.

 

SWOT Analysis – Traditional Daycare Services

Strengths

●       Helps kids build social skills, playing and interacting with other children all day

●       Often times have a lot of resources available for the children

●       Professional service, parents can trust them

Weaknesses

●       More expensive than our service.

●       Kids are watched over in groups, many times  not given individual attention from adults

●       Potential negative interaction with other children

Opportunities

●       Have your kid get off to a fast start learning

●       Offer all day service for your child

Threats

●       Many working parents have no choice but to bring their kids to daycares for the day

●       They know their kids are safe and they’ve been going there for a while

TJX Tots

Strengths

We are located directly inside the store, so your child will always be in very close proximity to you. You can check up on it mid-way through your shopping or enjoy your time away from your child. The price is less than the average hourly rate for a babysitter, so there is no incentive to hire one instead of just bringing it to our in-store daycare service. Another advantage we have over our competitors is price, as the price we charge ($13) is less than the average hourly rate for babysitters ($15) or nannies, which can be anywhere upwards from $20 per hour.

Weaknesses

As with any new business just starting, customers do not yet recognize our brand. We will need time to service our customers and gain a reputation before we can be easily identified on any level. When we start, our potential service market is small since we are only operating in three stores in the Boston area. However, this also means we have ample opportunity to expand in the future.

Opportunities

As just mentioned, we have lots of room to grow should our business be successful. Not only are plenty of other TJX stores in the state and region, but we could also move across the country and worldwide if we can. We also do not have to be restricted by TJX stores. Our business could fit within any store where parents commonly bring young children, including other retail stores and grocery stores.

Threats

As with any successful idea, there is always the threat of copycats if we do well. We are already taking inspiration from IKEA’s Smaland with our concept, and we cannot discount the possibility of others starting up to do what we do in other stores. Also, there is an inherent issue in the design of our business taking place within TJX stores: we are dependent on the store doing well. If sales slow in the stores we are located in, and fewer customers come in, our sales also suffer. The popularity of off-price retail and TJX, in particular, eases our concerns regarding this threat, but we cannot deny its existence. We can only hope that TJX continues its growth in the years to come.

Traditional Babysitters 

Strengths

Your child has individual attention or something very close to it. They are not going to be watched in a large group where attention is not at a premium. In addition to this, having the same babysitter consistently can be helpful to build a trusting and friendly relationship. You can get to know your babysitter, which helps parents feel at ease when they leave their children alone with them.

Weaknesses

Traditional babysitters tend to be relatively expensive. Our service, for example, charges less per hour. Parents often have to supply transportation to the babysitter’s house or babysitter to their house. There is no brand recognition, every babysitter is different, and with every different one you hire, you have to establish trust again and build a relationship.

Opportunities

Having a traditional babysitter allows you to build a robust and long-term relationship with somebody you can trust and rely on. No parent wants to have to worry about whether or not their child is in safe hands. By having a babysitter, you’ve known a long time parents can go about their business with peace of mind.

Threats

Babysitters are typically young teens looking for work on the side. Recent surveys have shown that parents are more likely to pay higher rates for child caregivers that have more experience and are not as young and or inexperienced. Parents are also leaning away from traditional babysitters because it is stressful to find a babysitter they like and trust; with these trends in the market, traditional babysitting may see a threat in their market.

Daycare Services

Strengths

Putting your child in daycare services can help him build considerable social skills at a young age. Interacting with other children and learning how to spend time with one another can help them get a “head start” in social life. Daycare’s also often have lots of resources for your child that, for example, a babysitter wouldn’t. A wealth of toys, games, puzzles helps keeps kids occupied and busy throughout the day. Since the daycare is a professional service, parents don’t have to worry about dropping off their children for the day. They know their child is in good hands with daycare professionals.

Weaknesses

Daycare services often cannot give your child the individual attention you’re seeking. It can often be quite expensive to leave your children there for the day. The average price for daycare in Boston is While it can be great to have your kids be around other young individuals, there also can be negative experiences. Exposure to inappropriate things, or fights with other children, can lead to a traumatic daycare experience for your child.

Opportunities

Daycare can be almost a pre-school of sorts and help your child get acclimated to this kind of environment. They offer an all-day service that would appeal to parents that work and need their children taken care of for the day. These services have opportunities to expand because there will never be a shortage of children who need to be cared for.  

Threats

With the increased demand for daycare and educational services for children, many benefits feel s though they can improve their rates. As other child care services catch onto this trend, they may lower their prices and begin threatening the more established services with lower costs for the same service. This could potentially drive business away from them.

Additionally, after surveying the potential benefits/issues within our business model, we received relevant results on our service’s perceived effectiveness and competitiveness. Out of 39 responses, 84.6% of responses were positive. Broken down, 43.6% of reactions find our service “as good” as traditional babysitting services, 35.9% see us as “slightly better than,” and 5.1% see us as “superior to” our competition. These results were encouraging to us and our service and enabled us to use something parents would use rather than a service similar to ours.

babysitting services

Sales Plan

To keep costs down, we will not create an extensive marketing campaign, at least for the time being. Our primary form of advertising will be signs placed around and within the TJX stores, we are servicing. We will start with posters that show photos of real children, possibly some that have been under the care of our TJX Tots professionals, smiling and having a good time. We will put the TJ Maxx logo and our slogan, “We watch, you shop,” on the poster, and they will display our hours. The signs located inside the stores will direct customers with children who fit our specific regulations, ages 3-10 and potty trained, to the TJ Maxx area where they can find our room. Also, when we open for business, employees will bring in their kids to demonstrate the service to our customers. This, we believe, will help attract customers who may be hesitant about leaving their children with us.

Child Care Services Business Plan

This is an example of a basic poster design we would use to attract customers to TJX Tots: We will note our credibility, low price, ease of use, as well as the benefit to the child and the mother through fun photos and phrases, such as those in the example. This way, our target customers will be drawn into the poster and feel confident about using our service before beginning their shopping experience.

We will also use Facebook as a method of advertisement, considering the number of moms who use Facebook and the fair pricing Facebook sets for their advertising. Moreover, advertising on Facebook is the best way to create awareness and boost our service sales: according to the most recent Facebook statistics, there are 1.76 billion active monthly users. According to a Pew Research Center study of parent users on Facebook, the average percentage of mothers find 76% of surveyed mothers frequently share, like, or comment on posts they find relevant. Additionally, 53% share or try to respond to “good news posts” they see on their feed, and we hope to become the good news that these mothers will be more likely to “like” or share with their friends. This speaks to the expansiveness and influence Facebook has as a social media platform. We will use photos like the example poster with a brief explanation of our service to promote ourselves. To advertise on Facebook, the cost is $3.90 per 1,000 views, and to have a “promoted post,” which is equivalent to 20,000 views, is $100.

We plan on implementing a “trial” period to test our service, which will give us valuable results to use to our advantage while marketing the validity and effectiveness of our business. We plan to let our employees or other TJX employees bring their children into TJX Tots to serve as a trial group of children. We will track the processes of how our employees work with the children all day and the effects of our toys and games. We will see what activities children like or dislike in our educational elements and plan accordingly based on the results. Additionally, we may make some slight changes to our layout or methods depending on the children’s likes or dislikes. We will also track how many children one employee works with and how long they can work most effectively. Finding the best manner of working is our goal of this internal experiment. We will summarize the pattern of how our educational elements work and figure out the changes necessary before we open to the general public. This “trial” will implement for two days, and employees will get payback during this time. The trial will allow us to market to parents with confidence in our business model and how it impacts children. Instilling consumer confidence is an intelligent marketing strategy for us because we know that when parents feel as though their children will be in safe hands, see how the system works and that children have already gone through the process, they will be willing to pay us and allow us to grow our service further.

Financial Plan

TJX Tots Company

Tots Company

In analyzing our target market, we demonstrated a potential customer base of approximately 29,000 households in the three towns we are starting up in combined. We want to be on the conservative side in our estimates, so we assume for the first year that we attract just 4,000 of these households or about 15.5% of the market. Of course, we expect the mothers to visit the stores more than once a year, so we’ll also assume they see once every three months. This is also a relatively conservative assumption, given that 75% of Americans visit a shopping center at least once every month. We are only operational nine out of the twelve months for the first year, so 4,000*3 nets us 12,000 transactions for the year. With a $13.00 for our service, 12,000*13 gives us $156,000 in revenue for year one.

Year one is also when the majority of our expenses are incurred. Almost all equipment and supplies we will need will be purchased three months before opening, including furniture, toys, cabinets, books, paint, carpeting, a television, a DVD player, and movies. Snacks and drinks won’t need to be purchased until we open for business and will be bought periodically after then. We’ll also create a small office in year two, with a computer to help us keep track of transactions. Floor space is among our most significant expenses; TJX charges $60 per square foot annually, and we’ll be renting a 20×20 section in each store. Salaries are also another effective cost, as we five owners will each make $20,000 annually, and we’ll also have six part-time employees each earning $10,000 a year. We will not hire this extra help until we open for business. Finally, we also have several miscellaneous expenses related to our business. “Professional” refers to the lawyer we will have to assist us from time to time to ensure we comply with all legal regulations, especially during the pre-opening. We’ll also be advertising by making signs and running ads on Facebook. Of course, we’ll have to clean and maintain our space as used once we open. Finally, we have to repay the interest on our loans each year, being 10% of the previous year’s balance. This expense will be incurred for every year we have an outstanding loan balance, which will exceed the three years we have planned out on the cash budget.

For the three months before opening (and until year three), cash payments exceed receipts, and thus our net income for the period is negative, being ($57,590). Considering that we need 5% of total expenses as our starting balance for the rest of year one, we have to include that our costs are .05*57,590, which is $2,880, further reducing our ending cash position to ($60,470). As founders’ equity and other equity are each capped at 25% of startup costs, these funding sources can only amount to $15,117 each. We need to take out a loan to finance the other half of the losses, $30,325. The interest will be paid every year, but we will not start paying back the balance until we turn a profit in year three, where the total amount of profit will go towards loan repayment. Unless we are considering expanding our service to other stores by that point in time, we will not have any other use for the profits. Beyond the three years, we will continue to pay the interest on the loan when required and will work towards paying off the balance as soon as we can.

As previously mentioned, we anticipate that we will be profitable starting year three, where revenue will exceed expenses. To do this, we assume that the number of transactions we process each year will grow a certain percent from the previous year, as more customers hear about and start using our service and existing ones come to the stores more frequently. For year two, the number of transactions will increase anyway because we’re going from looking at a period of nine months to a full year, meaning each customer will visit four times within the time frame as opposed to three. Still, we’re also hoping to gain a few customers. Growth will be slow at first, of course, so we anticipate gaining just 250 returning customers in year two, giving us a total of 4,250 customers and 17,000 transactions across the twelve months. By year three, we hope that the growth will be slightly more pronounced and that we will gain an additional 1,000 customers in that time frame, resulting in 5,250 total and 21,000 transactions. All of these estimates are somewhat conservative so that we may generate numbers higher than this. However, if that does not turn out to be the case, we will still turn a profit of $11,850 by year three’s end.

Operations Plan

Location and Layout of Business

We have decided to rent out a 20x20ft area from TJX. Two significant factors led us to this decision. TJX will charge us 60$ for every square foot of floor space we intend to rent from them. This is a pretty hefty price, so we want to limit the amount of space we are renting as much as possible. Our second significant factor in our decision is the Massachusetts mandated need for child care services to have at least 35 square feet per child. We believe this size of space is the best combination of taking both of these factors into account. This allows us to watch up to ten children at a time while keeping our total rent price in a manageable price range. Below is a diagram of a potential layout for our store.

Location and layout of business

On the left, you can see our proposed layout for our store within the TJX setup. We intend on using 20×20 sqft in the corner of the store. One side will be made of plexiglass the other outer wall will be made of whatever color scheme best fits in with the store. The inside will consist of four orange walls and a variety of different areas for the children. At the entrance where the sign-in arrow is, there will be a sign-in desk for parents to register their children and fill out paperwork for them. There will be two different tables. The one in the far corner will be for puzzles. There will be four chairs around it, allowing four children to sit down and work on the puzzle. There will be areas between the four chairs so that the mystery is not limited to just four children; others can stand and put a piece or two in on the go. There will be a TV area with bean bags in front of it. There will also be a lego station. Legos are very popular with children. That is why we have attributed a good size chunk to this. We anticipate the lego station being top-rated.

Neighborhoods

We picked all of our three settings based on their high percentage of families living there, the fact that they are known to be family-friendly areas with a lot of children. Of course, all of these areas have a TJX location within their midst. Boston, Massachusetts, U.S. is, of course, our target market; listed below are the specific places we intend to start our business.

The specific areas and store locations we have chosen are:

  • Dorchester (The TJ Maxx at South Bay Center, 8 B Allstate Road)
  • Newton (The TJ Maxx at 260 Needham St) and 
  • Cambridge (The TJ Maxx at Fresh Pond Mall, 198 Alewife Brook Pkwy)

Dorchester: The average household income is $62 273. 55.8% of all households in Dorchester are families; this gives us 34,602 to work with. There are https://mommypoppins.com/kids/25-things-to-do-with-kids-in-dorchester 

Newton: 

Cambridge: 

Suppliers and Supply Chain

We, At TJX Tots, have a good amount of suppliers that will be. We will have many necessities for our young children that we’ll be taking care of, including our educational benefit that we will be providing. 

Shipping and Storage of Inventory (food, toys, cabinets, carpets, etc. are all materials we need)

Equipment Needed

To provide services that bring value to the children and offer an exciting environment, we will need to acquire equipment that meets the age bracket of children we intend to serve. We want to purchase a range of equipment that will facilitate the efficiency of services that we provide. TJX Tots believe in creating value and making a difference in every child that is within our care. We shall need equipment that enables the children to develop holistically as they play around with their fellows. In this case, the major equipment that we shall require will be based on the value creation needs of every child. The following are the critical equipment that we will need at our disposal.

Toys 

Toys are essential in facilitating children’s experiences within the facility as they keep children busy all through. In this case, the facility will need a range of toy supplies that fit children between 3 and 10. Some essential toys required in the facility will include toy cars, toy trucks, dolls, doll accessories, woodblocks, plastic blocks, train sets, and other play station accessories.

Educational Items 

Educational items will also play a vital role in engaging children within the facility. Some of the things required for educational purposes for the children within the facility will include picture books, posters, and educational picture charts, calendar clocks, musical instruments, books, and learning toys. These equipment are essential for the facility since they help the children developmentally while they are in the facility. At TJX Tots, we value the learning process of every child. As such, we will invest in equipment that enhances a learning environment for children and at the same time create an exciting environment where the children feel at home away from home.

Furniture 

The facility will require different types of furniture that fit every child’s needs together with the caregivers within the facility. To provide adequate services, the facility will require several furniture supplies, including table and chairs, mats, puzzle rack, shelf with bin racks, high chairs, rocking chairs, small chairs that fit children in the age bracket of 3 and 10, nap mats and small beds where the children can sleep.

Art and Craft Supplies 

The facility will require some art and craft supplies to facilitate the children’s experiences within the facility. At TJX Tots, we appreciate the value created by artistic work on children’s lives, and with that in mind, the facility will acquire basic crayons, blue edge scissors, play-doh, marker paints, stencils, pom-poms, and glitters. These crafts provide enabling learning experiences for children more effectively.

Sleeping Supplies Equipment 

TJX Tots appreciate the value created when children get ample time to nap while within the facility. Therefore, the facility will require sleeping supplies equipment, including crib ports and napping mats for toddlers and small beds for infants.

How the Equipment will be Acquired 

We at TJX Tots have many suppliers that will take full responsibility for supplying the necessary equipment to the facility. We shall contract some of our suppliers with actual specifications of the various equipment that we will require within the facility. Our suppliers have the best rates and are more reliable when supplying the best quality and customer specifications. On the same note, some of the equipment will be acquired just within TJX stores that house the facility. Since TJX stores house our facility, we are also determined to show our loyalty to them by purchasing some of our equipment supplies.

Financing the Equipment Purchase

To fully finance our equipment supply, we will opt to source finances from bank loans majorly. Debt financing, commonly known as bank loans, will be an ideal source of finance for this kind of investment since through it, we can get both secured and unsecured loans that match our financial needs. Similarly, through debt financing, we can get both short-term and long-term repayment schedule options for the loan amount we have secured from the bank. This provides a flexible repayment option which is ideal as per the facility’s financial needs. Moreover, part of the finances will also be sourced from personal savings and friends and relatives to help finance part of the equipment purchase budget.

Human Resources

Core Values

We at TJX Tots believe in keeping your children safe while promoting educational values through play. While you shop carefreely, your children will be well supervised by qualified staff members who have your children’s best interests at heart. We value the importance of safety, honesty, and dependability on a service. The TJX Tots team has created a list of 8 core values that we feel exemplify the entirety of our service and our dedication to our staff, customers, and their children.

  • Excitement: We want your children to be as excited about coming into the store as their parents. Through our welcoming atmosphere, bright colors, an assortment of toys and games, and smiling employees, we know that your children will be quick to let go of your hand and start building legos with the TJX Tots team and other children.
  • Respect: We have the utmost respect for you, your parents, and, of course, our tots. We want to constantly instill in our staff that there is nothing more important than respecting the parents who bring their children to us and the children themselves and each other as employees of TJX Tots. There is never a business that will fully thrive without respect for each other and the customers. 
  • Dependability: We watch, You shop. That is our motto, and we will hold to it. When you drop your child off, you can depend on us to keep them safe and happy while you enjoy the TJ Maxx treasure hunt shopping experience you came into the store for. 
  • Safety: Your child will not be put into a situation where they could be hurt while playing in the TJX Tots care center. We will childproof the room with locks on the cabinets that hold any cleaning supplies or sharp items, will cover the outlets in the room, and all counter and table corners will have rubber ends put on them to avoid injury. We do not want any children to be hurt while they are in our care, and in the unlikely event they do get hurt, our staff will be First-Aid and CPR certified, and we will have First Aid kits in the room readily available. We want parents and children to be as comfortable as possible when using the TJX Tots service.
  • Kindness: A value that all adults and children alike should share; we at TJX Tots promote the kindness and fair treatment of others at all times and do not stand for negativity or rude behavior. 
  • Cleanliness: Children are always getting sick in school, and we know how hard it is to keep young children who do not know any better to keep their hands clean and their hands away from their nose and mouth. This is something we will emphasize in our younger children, and we will always have hand sanitizer available in dispensers on the walls, along with hand wipes and tissues. Our facilities will be cleaned two to three times a day depending on the number of children in the care center. 
  • Professionalism: Our staff will always professionally carry themselves, acting respectfully to the parents who come into the store, and will work kindly to resolve any conflicts that may arise among other staff members, parents, or children. 
  • Price Consciousness: We want to keep our price under that of traditional babysitters ($15/hour). We know that our prices are lower than that of a conventional daycare service or even an after-school care service. This is our goal; we at TJX Tots appreciate the off-price retail model of TJ Maxx and want to have that model reflected in our business structure when it comes to pricing. We want to be accessible to all and not restrict our business to only those who can afford expensive childcare services. 

Management Team

We have most of the skills required to manage our business right on hand with the five founding members of TJX Tots. However, we will need to hire more people to come in and work to watch the children who go into the stores. Each store will have two employees who work part-time for $10/hour. One employee will be a college student over the age of 21 who has experience in childcare and or is studying education and wants to gain experience in a field of similar structure to that of a daycare. The second employee will also be over 21 but will be someone who has previously worked in a school, daycare, or nannying experience. This worker will be in the store during peak times such as weekends or late afternoons to handle themore significant amounts of children that will most likely be in the store, and the college students will be in the store during slower times as to not be overwhelmed with too many children to watch over. We also believe that we will most likely need to hire a lawyer to handle any legal issues we cannot take in the future. This could include our waiver that each parent will sign before dropping their children off with us at the TJ Maxx stores or liabilities such as making sure we are within all Massachusetts state laws regarding child care. For example, the one-child per 35 square feet law. We believe that these are the significant gaps that we have in our management. With the lawyer and our hired employees, we have created a team that will be successful in managing and upholding the integrity and prosperity of the TJX Tots brand. 

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