How To Open a Daycare Center: Child Care Certifications, Steps, and More

Opening a daycare center is where passion meets purpose, blending entrepreneurial drive with a genuine commitment to shaping young minds.

As demand for high-quality childcare surges nationwide, this opportunity lets you build a thriving business while making a lasting difference in children’s lives.

But launching a daycare isn’t just about colorful classrooms and play areas; it’s about meticulous planning, strict compliance, and a dedication to safety. From licensing hurdles to staff-to-child ratios, every requirement—especially child care certification—is designed to protect and nurture the little ones in your care.

The path to becoming a licensed provider involves orientation sessions, detailed applications, and careful facility inspections.

Think of this guide as your roadmap: We’ll walk you through legal must-haves, insider best practices, and the keys to creating a daycare that parents trust and children adore.

Types of Daycare Programs

Before you start, decide what kind of daycare you want to run. Will it be a center-based program (in a separate building) or a home-based program? Both types have pros and cons, but all must follow strict rules to keep kids safe and happy. The steps to open each one are similar, but local laws may change what you need to do.

Family child care homes typically care for fewer children and offer a more personalized environment compared to center-based programs.

No matter which you pick, a strong business plan is key to making your daycare successful.

Creating a Business Plan

A good business plan is like a roadmap for your daycare. It should include:

• Your mission (what makes your daycare special)
• Who your customers are (families in your area)
• How much money you’ll need to start and run the daycare
• A business bank account to keep personal and business finances separate
• Your staffing plan, rules, and safety steps
• How you’ll market your daycare to parents

It should also cover licensing rules, staff training, and how you’ll keep improving. A clear plan helps you stay organized, get loans if needed, and build a daycare parents trust.

Steps to Starting a Daycare Business

With more parents than ever seeking quality childcare, the demand for professional daycare services continues to grow. The US childcare market grew from USD 107.01 billion in 2023 to USD 112.19 billion in 2024 and is projected to maintain a steady growth rate of 4.99% CAGR, reaching an estimated USD 150.54 billion by 2030. Whether you're an experienced educator or someone passionate about child development, continue reading to explore all the essential steps involved in starting a daycare business.

Useful Read: How to Start a Daycare Franchise: Your 15-Step Guide

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Step 1: Researching and planning

Before opening a daycare, you need to research your local area. Find out if there are enough families who need childcare and what other daycares are offering. Places with lots of working parents usually have high demand.

Once you understand the market, create a detailed business plan. This should include:

• Your daycare’s mission
• The ages of children you’ll care for
• How many staff you’ll need
• Your budget
• Researching state-specific provider requirements

Also, don’t forget to check your state’s rules for running a daycare so you stay compliant from the start.

Step 2: Capital and funding

You'll need enough money to start and run your daycare. There are a few ways to get this money: you can use your own savings, get a loan from a bank, or apply for special money (called grants) that's just for childcare businesses.

You'll need to get two important things:

1. An EIN (like a Social Security number for your business) for taxes
2. A separate bank account just for your daycare

These will help you:

• Keep your personal money and business money separate
• Handle all your daycare's money matters
• Follow all the tax rules

The government can help too:

• The SBA (Small Business Administration) gives loans to help pay for things like equipment and fixing up your space
• Look into grants (free money you don't have to pay back) like the CCDF (Child Care and Development Fund) - especially if you'll help low-income families
• Your state might have other programs to help

Finally, make a clear money plan that shows:

• How your daycare will make money
• How you'll pay your bills
  This will help convince banks or investors to give you money when you need it.

Step 3: Choosing the right location and facility Setup

Picking the right location for your daycare is very important. The place must be:

• Safe
• Easy for families to get to
• Allowed to operate as a daycare under local zoning laws

The building must be approved for daycare use and meet your state’s rules about safety and space.

Your daycare will need separate areas for:

• Sleeping
• Eating
• Playing

Each area has its own safety rules. States also have rules about how much space each child needs.
For example, California requires:

• At least 35 square feet per child indoors
• At least 75 square feet per child outdoors

Your building must also pass safety inspections for:

• Cleanliness
• Fire safety
• Emergency readiness

These rules are set by groups like the Consumer Product Safety Commission (CPSC) and the Occupational Safety and Health Administration (OSHA).

Step 4: Building and zoning considerations

When starting a daycare business, it’s essential to consider building and zoning requirements. Daycare centers must comply with local building codes, zoning regulations, and health and safety standards.

For example, a daycare center may need to be located in a residential area or a commercial space, depending on the local zoning laws. Additionally, the center must meet specific guidelines for indoor and outdoor space, lighting, ventilation, and safety features.

Research and understand the local regulations and requirements before opening a daycare business. Ensuring that your facility meets all the necessary standards helps in obtaining the required licenses while reassuring parents about the safety and suitability of your daycare environment.

Step 5: Become a licensed daycare provider

In the US, you need a daycare license to open a center. This license shows that your daycare meets important health and safety rules.
Licensing rules are different in each state, but usually include:

• Child-to-staff ratios
• Safety rules for the facility
• Educational programs

You can find your state’s specific rules in the National Database of Child Care Licensing Regulations.

Federal law also says that states must:

• Set rules for group sizes
• Set staff-to-child ratios based on the children’s ages

These rules make sure each child gets the care they need.

The childcare licensing process usually includes:

• Filling out an application
• Background checks for owners and staff
• An inspection by the state’s Department of Health and Human Services (DHHS) or a similar agency

Other things to keep in mind:

• Daycare centers are often checked every year
• Licensing fees can range from $100 to $1,000 depending on the state
• Running a daycare without a license can lead to fines or legal problems

Step 6: Hiring qualified staff

Hiring the right staff is key to making your daycare a safe and caring place. When you hire staff, you must follow your state’s rules and carefully check each person’s qualifications.

It is crucial to conduct criminal background checks when hiring staff to ensure the safety of vulnerable populations, such as children.

In the US, daycare staff must meet certain requirements, such as:

• A background in early childhood education
• First-aid and CPR training
• Passing background checks

For more information on hiring, check our blog about The Ultimate Guide to Hiring & Retaining Early Childhood Educators.

Most states, including New York and California, require:

• 12–24 hours of early childhood education credits
  or
• A Child Development Associate (CDA) certification

Other qualifications may include:

• Food handler certification
• Extra training in safety and emergency response

Background checks are required by the Child Care and Development Block Grant (CCDBG) Act. These checks help make sure that only safe, qualified adults work with children.

Step 7: Establishing health and safety protocols

Daycare centers must follow strict health and safety rules to keep children and staff safe.
Many states require:

• Health checks
• Up-to-date vaccines
• Daily cleaning and sanitizing

For example, in Washington, kids must have all their vaccines before they can join, following CDC rules to stop disease outbreaks.

Daycares also need clear rules for sick children. Common rules include:

• Children with fevers or contagious symptoms must stay home for at least 24 hours.

Caregivers should have clear steps for when a child gets sick to keep everyone safe. Staff should also regularly clean:

• High-touch surfaces
• Toys
• Restrooms

The Centers for Disease Control and Prevention (CDC) offers detailed guidelines on keeping childcare centers clean and healthy. Emergency preparedness is just as important. Daycares must:

• Have written plans for fires, earthquakes, and other emergencies
• Practice regular evacuation drills following FEMA guidelines
• Keep first-aid kits in several spots
• Train staff on how to respond in emergencies

Step 8: Designing an age-appropriate curriculum and daily activities

Creating a fun and age-appropriate schedule that helps kids learn, be creative, and grow socially is key in daycare. In some states, you must get your learning plan approved as part of the licensing process.
It’s important to understand your state's rules, especially about:

• Health and safety training
• Keeping records
• Nutrition standards for meals

Programs like Creative Curriculum and Montessori offer flexible, structured learning that fits these rules.

For example, Florida’s Department of Children and Families (DCF) says daycares must plan a daily schedule that includes:

• Structured learning time
• Free play
• Rest
• Outdoor activities

Many states also encourage teaching about different cultures to make all children feel included.

Some states, like Michigan, encourage daycares to regularly update parents on their child’s growth, helping parents and teachers work together.

Step 9: Creating clear policies and procedures

Having clear rules about enrollment, discipline, and safety helps a daycare run smoothly. Parents should get a handbook that explains:

• Operating hours
• Discipline policies
• Health and safety rules

To get the right help for starting a daycare, contact local licensing offices or Child Care Regulation agencies. They can give you important instructions and support.

The American Academy of Pediatrics (AAP) suggests using Positive reinforcement (rewarding good behavior) instead of punishment.

States like California and Illinois follow this idea and have rules that ban physical punishment and harsh behavior control.

Daycares must also have clear steps for:

• Handling sickness
• Dealing with accidents
• Managing emergencies

Having clear communication with parents builds trust and keeps them updated about their child’s day.

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Step 10: Insurance and liability requirements

In the US, most states require daycare centers to:

• Follow licensing and safety standards
• Carry general liability insurance to protect against accidents or injuries

It is crucial to obtain the right insurance coverage to protect your daycare business and ensure compliance with regulatory requirements.

If the daycare hires staff, workers’ compensation insurance is also required. This covers:

• Medical bills
• Lost wages if an employee gets hurt at work

Some daycare centers offer extra health insurance for enrolled children, which isn’t required but can make parents feel more secure.

Financial help, like federal funding and grants, is also available to help cover these costs.

Step 11: Marketing your daycare business

Marketing is key to attracting families and building a good reputation. A smart plan helps:

• Guide your marketing strategy
• Spot risks
• Attract funding

Start by building an online presence. Share details about:

• Your facility
• Your programs
• Your staff’s qualifications

Websites like Care.com and Google My Business help parents find and review local daycares.

You can also host open houses where families can:

• Tour the daycare
• Meet the staff
• Ask questions

In some places, like North Carolina, licensed daycare centers can join programs like NC Pre-K, which helps bring in more families looking for affordable early education.

Step 12: Setting Prices and Rates

Choosing the right prices and rates is a big part of planning your daycare business.
Your rates should:

• Compete with other local daycares
• Cover your costs and make a profit

Costs to consider include:

• Staff salaries
• Facility rent and maintenance
• Supplies and materials

You should also research what families in your area are willing to pay.

Setting fair, competitive prices will help you:

• Attract and keep customers
• Build a sustainable business

Clear pricing also reassures parents about the value and quality of your daycare.

What Certifications Do I Need to Open a Daycare?

Child care provider certification

In many places, daycare providers must complete certified training in child development or early childhood education.
Some states require you to have:

• A bachelor’s degree
• Certifications like the Child Development Associate (CDA)

These programs teach you about child safety, health, and educational techniques so you can give children the best care possible.

CPR and first aid certification

All daycare providers must be certified in CPR and First Aid. This training helps you handle emergencies and provide care until medical help arrives.

Some states require you to renew these certifications every few years.

Background check

Every daycare provider and staff member must pass a full background check.
This check usually covers:

• Criminal history
• Child abuse records
• Sometimes financial or credit history

This keeps children safe and gives parents peace of mind.

Food safety certification (if applicable)

If you plan to serve meals or snacks, you may need a food safety certification.
This proves you know how to:

• Handle food safely
• Keep kitchen areas clean
• Follow health standards

Programs like the Child and Adult Care Food Program (CACFP) often require this certification.

First aid and medication administration certification

In some places, daycare providers must get extra training to give children medications.

This is especially important if you care for kids with allergies, asthma, or other medical needs.

Health and safety certifications

Depending on your location, you may need certifications that show your facility meets:

• Fire safety standards
• Emergency evacuation plans
• Sanitation and cleanliness rules

Important tip:
Always check with your local licensing office to find out exactly which certifications you need. Requirements can be slightly different depending on your state or region.

How to Start Your Own Daycare at Home

If you want to open a daycare in your home, the rules are similar, but there are a few extra things to think about:

• Zoning:
  You might need special permission to run a daycare from a house, especially if you live in a residential area. Make sure your home follows local zoning rules and check if your neighborhood’s homeowners’ association has any restrictions.
• Insurance:
  Just like daycare centers, home-based daycares must have insurance. General liability insurance and other policies are important to protect your business.

In some states, family daycare homes that care for only a few children (not counting your own kids) don’t need a license.
However, even unlicensed home daycares must meet health and safety standards to protect the children.

Expanding and Growing the Business

Growing your daycare business takes good planning and hard work.
Here’s what successful daycare owners focus on:

• Regularly checking their services and making improvements
• Keeping up with new ideas and trends in childcare and early education
• Being flexible and ready to meet new family needs

You might think about offering:

• Extended hours
• Summer programs
• Services for children with special needs

By improving your services and caring deeply about the families you serve, your daycare can build a great reputation and attract more families.
Staying innovative and keeping high standards will help your daycare grow and succeed for many years.

Conclusion: Building a Safe and Nurturing Daycare Environment

Opening a daycare in the US takes careful planning, knowledge of licensing rules, and a strong commitment to quality care.

By following federal and state regulations, designing a caring curriculum, and hiring qualified staff, you can create a daycare that makes a real difference in children’s lives and supports families in your community.

Manage Your Daycare Center Efficiently with illumine

Managing a daycare center requires more than just a love for children; it demands efficient organization, streamlined communication, and a focus on safety and learning. 

illumine, a comprehensive daycare management software helps you to optimize operations while increasing parent engagement. With features like digital attendance tracking, lesson planning, real-time parent communication, and automated billing, illumine simplifies the day-to-day tasks of running a daycare.

By using Illumine, you can maintain compliance, improve transparency with families, and focus on delivering quality care that meets both state standards and parents’ expectations.

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