Research your state's requirements. Some states, such as Rhode Island, have highly regulated preschool requirements and you will be expected to adhere to them. Many states require preschool providers to have at least an associate degree in child development.
Acquire the appropriate education required by your state. Many colleges and universities offer online programs if there are no campuses nearby. A bachelor's degree in early childhood education can attract the families of potential students, whether or not it is a state requirement. If starting your own business does not prove to be successful, a related degree will still leave you with a marketable skill to work for someone else.
Perform market research to ascertain the demand. Look at census data for your area to determine the number of families likely to need preschool services. Find out how many preschools there are in the area, and if any have waiting lists for admissions. If there are more students than available schools, you will have a good chance of success in attracting parents.
Create a business plan. Include a description of the new preschool, how it will be marketed, run and operated, as well as your insurance coverage. Financial information must also be included, such as loans that you may be taking out to finance the venture.
Create a name for the preschool and look into legal structure. Many home preschools are run as a sole proprietorship. Apply for loans and grants, if needed to start your business. Outline necessary purchases, such as toys, books, furniture and play equipment. Determine if you'll have to fence your yard or build an addition onto your house.
Obtain the necessary licenses as outlined by your state's requirements. Most states have requirements regarding the amount of physical space, staff-to-student ratios, health codes, safety, fire, discipline, record keeping, educational requirements, nutrition and zoning regulations. Look to your local government to schedule a meeting with the licensing specialists who can guide you through the process.
Obtain a tax ID number and register for taxes with the state and local government. The type of business you have will influence the kind of taxes you will pay. Corporations, for example, often pay more in taxes than do sole proprietors.
Research liability insurance. If you are the sole proprietor, an accident could potentially bring you to financial ruin without insurance. Naturally, you should take every precaution to make sure accidents do not occur.
Develop a budget and record-keeping books. Prepare to track income and expenses for tax purposes as well as student progress. A cash flow chart will help you project your income over the year. Determine whether an outside accountant will be beneficial and cost effective.
Market your center through any means that fit within your budget. Remember that word of mouth is always the most powerful method, but it will take time to build your clientele. Knowing the competition will help: for example, if there are many centers that focus on 3- to 5-year-olds, consider having a preschool program exclusively for 2-year-olds.
Prepare your home for small children. The designated area in your home should be clean, inviting and safe, as well as furnished comfortably for this age group. Toys should be age-appropriate, educational and regularly inspected for hazards. Organize the room with separate themed areas. For example, design "centers," such as kitchen, dress-up, writing, reading, crafts and building.