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Fee Increase


sharonash
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Im a bit confused at how to go about increasing the fees this is our first fee increase

I feel I have to justify myself?

Does anyone have a letter they send to parents that I can have a look at please?

 

I havent a clue how to even work out how much to increase it by, any advice? I know I need to take into account things such as minimum wage increase and the NEG we currently get £8.13 for a 2.5 hour session. We have 2 x 5hr sessions a day or a full day.

Does anyone have a session purely for the funded children without a top up? I would only be able to do this for afternoons?

Can anyone help please?

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awww stop worrying you don't have to justify yourself - did the gas company justify their increase to the parents??!!!! No - neither do you, its business! Oh god I'm not a bitch but sound like one!!

 

I don't think its unusual to have a 2% increase in salary per annum so why not start with this? work out your current fee to salary - so how much your getting in a week in fees to how much your paying out in wages - This should give you a starting point. (be mindful if you have staff who work through school holiodays if your neg children don't attend) Look at how much you should be allocating to overheads and unexpected costs too.

 

We increased our full day by £1 in september but I think some companies increase it by more. We sent a basic letter out explaing the increase in minimum wage and the new fee structure and how to continue to provide quality care and education the increase is necessary.

 

We do offer just neg funded sessions and if you have the availabilty and staff already in place it shouldn't be a problem

 

Sorry I can't help anymore

 

Good luck

 

Jayde

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How bizarre - I was just driving home from work thinking that I'd go on the forum and ask how much people increase their fees by!!!! Thanks!!!!

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Our session is £6.50 and I'm increasing by 50p for January so will just put out a letter saying due to the increase of the minimum wage!!!!

Parents have never queried it

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I used to put the fees up once a year by 50p due to rising costs- it stated in the prospectus that fees would be reviewed annually - and no parents ever questionned it. I think it's good to give parents prior warning of the increase so that they can start to plan for it.

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I increase my fees on an annual basis, in September, which has tended to be 50p increase per session.

 

I'm curious when you say you have NEG funded sessions do you mean you only take funded children for those sessions?

The DFES Code of Practice ays that you cannot charge any top up for funded hours, is this how you operate?

 

 

Surestart site has some valuable resources for business management including setting fees.

 

Surestart - It's the business

 

here is the financial section which takes you step by step through the process of calculating fees to charge.

 

 

Something I need to do for the new year to calculate the cost of employing a graduate.

 

Peggy

costing_the_business_fees_setting.pdf

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Hi Peggy

 

Yes we do just have funded sessions 9-11.30 and 1-3.30 that are accessed by 3+4yr olds

 

We are a private DN with the usual full day care 8-6, but we are operating in a childrens centre, so its about providing for the community first and foremost (although out of 26 pre schoolers only 6 attend for NEg sessions only - the others have some sort of attached session for example lunch 11.30-1 added on to beginning or end of session or tea 3.30-4.30 which parents pay for Or just have neg deducted out of full day care sessions 8-1, 1-6, 8-6)

 

Yes it can be confusing and a pain when it comes to invoicing!!! But it works for us and thats the main thing.

 

Oh and we have staff that work term time only too so that we are not overstaffed during holidays...which run in line with the funding terms.

 

Jayde

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I used to worry about increasing fees and in fact didn't do it for quite a few years. After being on a Business Management course and being advised on how important fee increases are to keep your head above water, I decided to put into the Parents Contracts that the fees would be increased yearly to keep up with rising costs. It is going up by £1 in January. Parents don't quibble about it. Their child is being cared for, for 3 hours, in a wonderful, exciting, caring setting. WE ARE WORTH IT and more.....

 

Sue J

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Thanks everyone,

 

I think Im just feeling a bit unberved by the fact that we have lost 3 children this week to the local hospital nursery because its cheaper,.

I am getting tongue tied at what to write in the parents letter if anyone has a punchy statement I would be grateful!

 

 

Also with the NEG I give the parents the option to do 2.5 hours but if they stay for the full 5 hour session I charge- this is ok isnt it?

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Yes I think its ok to do that

 

I think you need to promote yourself more as a quality setting you appear to have lost some confidence in yourself! ....don't worry about the hospital nursery because its cheaper...different settings appeal to different parents for different reasons.

 

I always recommend to parents when I show them around to check out other settings in the area because they have to be comfortable with how their child will fit into the environment.

I know that when we opened we were 'accused' of 'stealing' children from the next nearest setting - I had a chat with manager there and we came to the conclusion that we were providing for different needs of parents - as it turned out I actively promoted her setting if I didn't think we were what the parent was looking for and she did the same to me (I also actively promoted her as a manager for a similar setting as the one I manage now :o - we still talk and compare goods and bads now)

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Thanks everyone,

 

I think Im just feeling a bit unberved by the fact that we have lost 3 children this week to the local hospital nursery because its cheaper,.

I am getting tongue tied at what to write in the parents letter if anyone has a punchy statement I would be grateful!

Also with the NEG I give the parents the option to do 2.5 hours but if they stay for the full 5 hour session I charge- this is ok isnt it?

 

 

I can see why you are nervous losing 3 children in a week, wow, not sure what the statistics are for that happening, 3 all at once, ask yourself, why have they got spare places if they are so cheap??? Maybe it was a case of one person went and two followed like sheep.

 

Not sure about a 'punchy' statement in your letter to parents. How long do you require parents to give notice if they are leaving? I think you should give the same amunt of time notice for increase. ie: if a months notice then increase in a months time, a terms notice then increase in a terms time. Then state that fees will be reviewed annually.

My last letter was on the lines of , as of September 2006 fees will increase by £xx, annual increase in costs to us have been increase in:

* Rent

* Minimum wage

* Insurance

* resource costs

Our easy payment terms still apply and you have the following options: blah, blah.

 

ie: put increase info as a fact, don't apologies ( sorry to inform you but because of, or regretably fees have to increase because of) then put in a positive, like all the ways fees can be paid, then end with any queries please do not hesitate to speak to, XXXX, in confidenceXXX.

 

On my last letter I actually wrote that "unfortunately I have also noticed an increase in the cost of a local car wash, they now charge £6 for 3 minutes, we only charge £2 per hour :o:D .

( the next day as the parents arrived for pick up all the children were washing my car xD:( )

made the parents laugh, unfortunately I then had to take my car through the car wash to get all the hand print marks off. :(

 

The charging for the sessions is confusing. What you have to do is calculate your hourly charge, ie if open for 5 hours and your fees are £20 a day thats = £4 per hour.

deduct 2.5 hrs from 5 hours = 2.5 hrs to charge for, = £10. fees for a child who attends 5 hours of which 2.5 are NEG.

 

If you work it out the other way by deducting the NEG from the days fees this is seen as using money from non funded time for NEG time which is called topping-up, which is then seen as the NEG time is not free to the parent.

ie: you get £8.13 per 2.5 hrs, that is £3.256 per hour, so if you deduct £8.13 from £20 that = £11.87- which means they are being charged £1.87 top-up because they should be only paying £10 for the time outside the NEG. Does that make sense, if not let me know what your current fees are and I will do the calculation for you,

 

Peggy

 

Peggy

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I was told by our business advisor at our local Surestart never to apologise for fee increases. If you need to explain why you are putting fees up then do so, but you do not need to justify a rise. And don't be nervous about it, if you need to raise fees then you do. Parents will always ask your reasons if they want to know, but very rarely do.

Good luck.

Linda

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Peggy its been a really long day ben at work since 630 this morning

 

thanks so much for your reply but Im so confused!

 

We charge £16.50 for a 5 hour session or £10.50 for an afternoon session of 3 hours,

we have funded children who attend each session?

 

Some children also use 2 or their NEG sessions in one morning? they were told they could do this?

 

I really appreciate your help

 

thanks

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When I ran a nursery we were told that we could provide 2 x 2.5 hour sessions in one day but that they had to be separated by a 1 hour break in the middle, i.e. lunchtime. It may be different in different parts of the country - I was in Staffordshire.

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Peggy its been a really long day ben at work since 630 this morning

 

thanks so much for your reply but Im so confused!

 

We charge £16.50 for a 5 hour session or £10.50 for an afternoon session of 3 hours,

we have funded children who attend each session?

 

Some children also use 2 or their NEG sessions in one morning? they were told they could do this?

 

I really appreciate your help

 

thanks

 

 

£16.50 for 5 hrs = £3.30 hourly rate.

 

so if a child attends a full day and is entitled to 2.5 hrs free in that day. The fees for the parent would be.

 

5 hrs minus 2.5 hrs = 2.5 hrs to pay for = 2.5 X £3.30 = £8.25 fees for the day.

 

If the parent is using the afternoon for funded time this is the calculation.

 

Cost is £3.33 per hour. 2.5 hrs free so parent pays for .5 hrs = £1.66 for afternoon.

 

If the parent is using funding twice in one day and the session is 5 hrs long, you would need to extend to 5.5 hrs to anable at least a 30 min break between the 2 funded sessions. The 5 hrs would be free but the parent would have to pay for the half hour break.

 

Hope this makes sense.

 

Peggy

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Hi all..

 

I've got the same problem.

 

Ive been the manager of a private nursery for a year and worked here for a year and a half. In that time fees have not increased at all, and from what i can gather from staff who have been here longer, they haven't increased in about two years.

 

Someone new bought the nursery a year ago and he's made obvious asthetic changes; New windows, new resources, new staff and we're having lots more work done right now. The parents have commented on the changes we have made, both externally and internally.

 

My issue is that I want to completely alter the fee structure of the nursery, but I'm worried about the affect it will have on the parents...i certainly don't want them to leave, however, we have to increase our revenue to compensate for the tens of thousands of pounds being spent on the building. I'm going to lengthen the time we open from 8-6 pm to 7.30 - 6.30 pm and offer a two tier care system to the parents: They can have from 7.30 until 3.30 for the same price as now..or they can have 7.30 to 6.30 for 100 pounds a month more. It does seem like a huge amount to increase the fees by, but at the same time it workds out to five pounds per day (ish) and the fees have not been increased for two years.

 

What I'd like..please times a million...is other members' thoughts on this, if possible. I've got the parent meeting next Friday when I will give them an annual report type thing and tell them all about this, with it being enforeced in February.

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I would be wary of those opening times -it is an awful long day and of course you cannot expect one to work 7.30-6.30. You would have to be taking on more staff which pushes up wage costs. Is there a demand for those times? Do not forget wages,heating,lighting costs. My prices went up in November for the 2nd time in a year and I got a lot of grief from parents even though it amounted to £1.50 day over almost 3 years. £5.00 per day may not seem a lot to us but for and extra 3 hours it may seem to them a lot especially if in full time.

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Thanks, Shelia.

 

i've just realised that I really rudely hijaked Sharon's topic too, so apologies, Sharon.

 

There is demad for the excess hours, we already offer an extra half an hour of care from 6-6.30 pm for a surplus charge of five pounds for those parents who wish to purchase it.

 

I've had a talk with my employer (who owns this setting) and we've decided this:

 

The nursery will open at 7.30 am until 3.30 pm for those parents who don't wish to pay the increase in fees. The foundation stage will operate until this time and the children will be given breakfast, snacks throughout the morning and lunch.

 

At 3.30 the nursery structure will change, and 2-5's will come together in the largest room we have. They'll have free play, activities and outside play and be served a hot meal at 3.45 and supper at 6.00 pm. This will be charged at 80.00 per month more.

 

The only extra person we have to employ is a part time person between 3.30 and 6.00 pm and the extra utilities will be covered, we hope, by the fees.

 

Thanks for your input, Sylvia, it was very thought provoking.

 

 

Michele

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