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How to write a rate increase letter for daycare parents

Updated July 25, 2018

Operating a day care centre, either in your home or in a commercial location, is a satisfying career choice for anyone who wants to own their own business and work with children. However, like any business, day care centres incur significant overhead costs. Rent or mortgage payments, utilities, supplies and staffing costs add up, and as those costs increase, it is sometimes necessary to raise the rates that parents pay for their children's care. It is important to provide information about rate increases in writing, and communicating the information clearly and providing valid explanations helps prevent misunderstandings and disgruntled customers.

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  1. Write a greeting to the parents. Use your word processing program's mail-merge function to personalise each letter.

  2. Describe some of the positives of your day care business in no more than one paragraph. Mention some recent highlights, improvements that you have made or training that you have received. Remind parents of the value of your day care facility.

  3. State that you will be increasing the rate to maintain the quality of your day care centre. Indicate exactly how much the rate will increase and the date that the rate increase goes into effect.

  4. Explain why the rate increase is necessary. For example, state laws restrict the number of children allowed in day care centres, and therefore their ability to grow. Explain that your operating costs have increased, and you need to increase rates to continue to offer quality care.

  5. Offer parents the chance to ask questions or discuss concerns with you. Provide your phone number or e-mail address, even if parents already have your contact information.

  6. Outline instructions for parents to approve the rate increase. Add a tear-off form at the bottom of the letter that parents can sign and return to acknowledge the rate increase, or simply include a space where they can sign to indicate their acknowledgement.

  7. Thank parents for their understanding and for the opportunity to care for their children. Sign the letter.

  8. Tip

    Provide adequate notice, usually at least 30 to 60 days, so parents can adjust budgets or make alternative arrangements.


    When increasing your day care rates, be sure that the increase and communication is in line with any contracts that your customers signed when they enrolled their children in your centre.

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About the Author

An adjunct instructor at Central Maine Community College, Kristen Hamlin is also a freelance writer on topics including lifestyle, education, and business. She is the author of Graduate! Everything You Need to Succeed After College (Capital Books), and her work has appeared in Lewiston Auburn Magazine, Young Money, USA Today and a variety of online outlets. She has a B.A. in Communication from Stonehill College, and a Master of Liberal Studies in Creative Writing from the University of Denver.

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