Interesting analysis Jelbayeh.Personally if those figures are...

Interesting analysis Jelbayeh.

Personally if those figures are accurate I don't find child care a great business to be in.

The $4k profit sounds nice, but that assumes the centre always has 80 kids in it, ie its full to the brim. What's a more average year like, 80% capacity? If it's 80% or less on average for a year, that's the entire profit margin wiped. Too high a fixed cost base I think.

I don't see 100% occupancy as the "norm" over the long term. It looks more like to me that the explosion in child care demand in recent years has caught many off guard, resulting in a temporary supply and demand imbalance. Over time this should correct as from what I hear it's not that hard to whack up a child care facility. Maybe your council is especially stubborn when it comes to these things.

another way of looking at whether $4k profits a week is a reasonable assumption, is to look at the long term historical records of the child care industry. The average business in the industry barely broke even. Unless there's been a paradigm shift in the way the industry operates, there's every reason to expect past performance as a good guide to what to expect in the future. So, where is the paradigm shift?

I checked that site you linked. I don't know, but it doesn't look quite bona fide to me.

Well, I guess it's all down to assumptions, it's hard to put firm values on these things