How to Increase Occupancy: Why Data Matters

June 20, 2022

It's time to get serious about your numbers.

It's time to get serious about your numbers.
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So what is the big deal about data? Well, if you get it right, it can be the key to seriously increasing the revenue at your childcare centre.

See, by properly understanding past and future occupancy data, you can optimise your staffing and reduce your daily overheads considerably. What’s more, knowing when and where your occupancy dips is the first stage of getting more bums on seats. Or at least the classroom carpet.

Moving beyond ‘Numbers on roll’

Many nurseries still choose to manage their occupancy data using ‘numbers on roll’, and this is a problem.

Why? Well, let’s say my favourite ice cream place measured their sales for each month on how many different customers they had, just like numbers on roll. They wouldn’t have very realistic statistics, as they’ve got no idea how many times each customer was in, and how many ice creams they bought.

If 100 different customers went in, that’s no way to reflect that some customers may have popped in to get ice cream more than just once. (Hint: I bought quite a few).

So what has all this talk of ice creams got to do with your nursery? Well, by only keeping numbers on roll, you have exactly the same problem. You have no idea of how often each child was in, and no way to compare it to your total occupancy.

Let’s say you have 50 places at your setting and 50 children on roll. Perfect you might think. But if each of those children is only in two and half days a week, you’re actually only at 50% occupancy. That’s a whole lot of wasted revenue.

So if ‘numbers on roll’ isn’t the right answer to recording occupancy, what is?

Welcome, FTE

FTE stands for Full-Time Equivalent. It’s usually expressed as a fraction or a percentage, but in basic terms it displays your occupancy rate as the amount of hours successfully filled compared to the total available hours.

All you need to work it out it is your registers, a calculator and a spreadsheet (or a nifty piece of nursery management software). If you have space for 10 children and operate 8 hours a day, then to have full occupancy you need 10 children who are there full-time, or you could have 20 children who are there 4 hours a day. Of course, what’s more likely is that you’ll have a mixture of the two.

Once you’ve calculated your FTE, you can now work out how much space you really have available. If you’re able to break down the figures session by session, day by day, you’re in an even stronger position. This way you’re able to optimise revenue, by seeing where your quiet periods are, and which rooms and ages have more space.

All in, you can now optimise your marketing and awareness to push your occupancy rate much closer to your real full capacity.

Data from the distant past

Now that we have a better idea of how to organise your occupancy, what can we actually do with all this data? Why not start at the beginning.

The best thing about past occupancy data is that you already have it ready to use from your registers and your child plans. In a perfect world, it’s better to work off a plan here rather than a register, as you can look at vacant places rather than just attendance records, including holidays and sickness.

The best thing about having records going back in time is that you can make comparisons year on year. Are there certain times of the year that are always quiet? Many nurseries are quiet towards the end of Summer as pupils prepare to move onto big school, for example. Most nurseries tend to be quieter on Mondays and Fridays too.

Once you have this kind of understanding of your own childcare centre, and you can prove that it’s happening year on year, you can start to work out why it’s happening. Importantly, this keeps you prepared for that same time next year, and leaves you with enough understanding to do something about it.

This could be alerting your waiting list – if you’re lucky enough to have one – or letting existing parents know that slots will be opening up. You could increase your marketing or offer cheaper rates for the quieter sessions. A small reduction makes sense to increase general revenue by filling up unused places. But as you get closer to 100% occupancy rate, reports show that the cost per contact hour also reduces, as certain fixed costs like the premises don’t actually increase per child.

Projections not predictions

While understanding past data can be useful, projecting your occupancy rate going forward is where the real benefit lies.

By accurately projecting based on plans rather than just predicting using past data, you have a much more precise framework to work around. Yes, it can be slightly more difficult to collect this data, but it’s worth it.

For one, you can cross reference these plans against your necessary staff to child ratios and you’re able to much more accurately deploy your part-time staff to avoid unnecessary overstaffing.

As the Ofsted report shows, staffing is by far the highest cost in nurseries, and with a complete overview of your own occupancy, you can look to reduce overstaffing that sends these costs through the roof.

You don’t need to stop there. Double down on that projection data by using it to identify upcoming quiet periods, both in general and in specific rooms and ages. This way you can target your marketing or offer schemes much more carefully to ensure that you fill up the sessions.

Yes, you can do this to an extent with past data. But with projections you’re working off data that you know is going to be right.

The big ideas

Official Danish Government Reopening Advice

Guidance from the Danish Health Ministry, translated in full to English.

Picture of a Guidance document
UK Nursery Covid-19 Response Group Recommendations

The full recommendations from a working group of over 70 nursery chains in the UK.

Please note: here at Famly we love sharing creative activities for you to try with the children at your setting, but you know them best. Take the time to consider adaptions you might need to make so these activities are accessible and developmentally appropriate for the children you work with. Just as you ordinarily would, conduct risk assessments for your children and your setting before undertaking new activities, and ensure you and your staff are following your own health and safety guidelines.

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Find out below how Famly improved parent communication at N Family Club, and see what we can do for you in a personal demo.

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Find out below how Famly improved parent communication at N Family Club, and see what we can do for you in a personal demo.

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