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Reasonable price increase for childminder fees?

(25 Posts)
LuckyLopez Tue 23-Dec-14 14:52:38

I live in the South East and currently chafe £42 per day. I'd like to raise my prices next year and wonder what a reasonable increase is? This includes everything except nappies.

Also I'm happy to give a small discount for children attending preschool for their FEEE. What discount do you think is reasonable?

LuckyLopez Tue 23-Dec-14 14:53:08

*charge not chafe!

eastmidswarwicknightnanny Tue 23-Dec-14 18:04:27

Whenever our cm increased fees we have used 2 one charged by the hr n put it up 25p an hr the other charged by the day n increased by £1 per day (east Midlands here n were 3.75/hr for cm1 n £32 for cm2)nursery we also used (did mixed week) increased every Oct by £2 a day was £42/day when 4yr old started at 13mths n £48ish a day by time we finished this summer.

I wouldn't offer a reduction for pre school hrs unless u actively want to attract those clients for quieter mornings in term time but extra work for you in terms of drop off n pick up n being tied to those times. But maybe 25% reduction on hrly rate for those hrs only

Middleagedmotheroftwo Tue 23-Dec-14 18:09:38

Employed people are likely to get in the region of 2%, so that's the maximum I would increase by.
Why are you increasing your fees? Have your costs gone up or do you want to give yourself a pay rise?

LuckyLopez Tue 23-Dec-14 18:23:36

I don't mind doing the preschool drop off and pick ups. My dd currently attends there. It's close by and on my children's school premises anyway. I have a current clientele that will be using this from next September so I need to get my pricing structure straight before then.

Both reasons tbh. Cost of food, fuel and heating is going up all the time and I charge below market rate in my area- I also deserve a pay rise.

fieldfare Tue 23-Dec-14 18:25:09

Rate of inflation is reasonable so approx 3%, but if you take into account how much food prices have increased (if you include meals in your prices) then it should be more as your costs have gone up.
I need to review my prices more thoroughly but will probably have a £2 a day increase.

LuckyLopez Tue 23-Dec-14 18:25:43

Oh and 2% is 84p a day- I'll definitely be raising it more than that.

Blondeshavemorefun Tue 23-Dec-14 20:21:13

Think 25/50p per hour is fair to you and family - average 10hr day increase would be 250/5 a day

Middleagedmotheroftwo Tue 23-Dec-14 23:06:00

To play devil's advocate, and so as you're prepared when parents ask you, what makes you think you're entitled to a pay rise above the national average pay rise (and above any payrise the parents might be getting)?
Cost of food and other stuff will come down if cost of petrol stays down.

LuckyLopez Wed 24-Dec-14 06:37:51

Fair question. Except that I charge for a service, and draw a wage from my profit. Just because my service charge increases, doesn't mean that I get to keep that increase. Also as I said before, I charge less than other providers locally and so I'm not pricing myself out of the market. I have very lovely families who I know won't begrudge be an increase.

I haven't increased prices for two years (so annual 'pay rise' comparisons are unfair) and probably won't for another two years so will affect new customers by then.

I don't think they will question me anyway, I'm not their employee, I offer a service for a price and of course they aren't obliged to accept it. They are very free to terminate and look elsewhere.

sebsmummy1 Wed 24-Dec-14 06:41:49

Just make sure it's not so much that you cause offence and make your clients want to go elsewhere. I think 2%-3% sounds reasonable.

LuckyLopez Wed 24-Dec-14 07:59:19

Cause offence? I'm not sure businesses make cost decisions based on how much offence they cause.

I've had a chat with DH and my accounts book (!) and decided to raise them by £2 to £44per day. I will give a discount of £4 per day to those using FEEE and need me to provide wrap around and holiday care.

LittleBearPad Wed 24-Dec-14 08:03:54

Why on earth should the OP not give herself a payrise?

CMs are running businesses. They also have bills to pay. OP 3-4% would probably be fine although rounding it to a sensible increase per hour/day will be easier for parents.

fancyanotherfez Wed 24-Dec-14 08:10:11

I live in the south east and the going rate is £50 a day round here. Your clients are lucky they are getting a good rate! My childminders put her fees up by 50p an hour. She's great so I paid it happily!

Inthedarkaboutfashion Wed 24-Dec-14 08:15:42

I think £2 per day is reasonable. When I used a childminder price increases were usually 25p per hour which works out at more than £2 for a full day. It is good form to give parents a reasonable amount of notice of the price increase - I would suggest 4 weeks as a minimum.

LuckyLopez Wed 24-Dec-14 08:24:22

I give a minimum of 8 weeks notice and actually this will be for a September change.

sebsmummy1 Wed 24-Dec-14 08:48:42

I think pay hikes can cause offence if they are too high unfortunately as it can be see as greedy.

OP you are the one running your business so I assume you know how much your overheads have increased by and what profit you are clearing monthly. Only you can really decide what is justifiable to your clients and getting pithy with strangers on the internet who are giving their opinions seems a bit silly.

HSMMaCM Wed 24-Dec-14 08:53:34

I raised mine by £1.50 per day this year 3%. When I used to take children to pre school I didn't offer a discount, but now I provide the funded hours myself.

LuckyLopez Wed 24-Dec-14 10:49:55

Hardly pithy. Just explaining my POV. I genuinely don't work and would work for families who would be offended by a price increase. It's in my contract that I review annually and I always send a personal letter whether I'm increasing or keeping fees the same.

I'm glad I'm not way off the mark in terms of costs. £50 is about the average around here and actually friends of mine charge £60! I think at even £44 I'm offering very good value for money. I made about £10,000 profit last year for a 46 hour week, hardly greedy am I?

adsy Wed 24-Dec-14 14:07:42

sebsmummy where is OP getting pithy?
Do people not think a business should ever raise their prices?

Pico2 Wed 24-Dec-14 14:31:18

Why aren't you closing the gap to the local average? Even if it takes a few years to step it up. Do you offer less than the average in some way?

LuckyLopez Wed 24-Dec-14 14:57:22

Well I'm trying to close the gap. I can't just jump ten pounds though when people think I'm greedy for asking more than 84p a day rise grin

HSMMaCM Wed 24-Dec-14 16:27:09

LuckyLopez - I've jumped £10 for new business, but not for existing families.

Middleagedmotheroftwo Wed 24-Dec-14 16:59:00

I don't think you're bring greedy, and do think that asking the going rate is reasonable. I just think that increasing the cost of your service by more than any cost of living increase at a time when the people using your service will be lucky to be getting more than a couple of percent at most, and at a time when costs are set to reduce, would need justification. You have given your reasons, and as you say, people can go elsewhere if they think you're bring unreasonable.

Tanith Wed 24-Dec-14 17:28:34

I think some people on this thread don't understand about childminders being a self-employed business.

It's nothing to do with being greedy or matching her clients' payrises. It's everything to do with the Op being able to continue providing the same level of service that her clients have come to expect. Her costs have increased, therefore she must either put up her own rates or her clients must accept a significant reduction in service. I'm guessing they'd prefer the increase.

Valid comparisons are the nurseries' hike in fees, or the supermarkets' increase in prices over the last few years, not the wages of employees.

Any payrise for the Op herself is separate to this.

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