Tuition Pricing Calculator

Pricing daycare or preschool tuition means covering per-child operating cost while also building in a margin, and this calculator works through that math in two steps. First it divides Monthly Expenses across the children actually expected to be enrolled -- Licensed Capacity multiplied by Enrollment Rate (%) -- to get Cost Per Child/Month, the break-even amount you'd need to charge each enrolled child just to cover costs with no profit at all. Then it grosses that figure up by Profit Margin (%) using a markup-on-price calculation (dividing by one minus the margin, not simply adding the margin on top), so Recommended Tuition/Month is the price that leaves exactly the target Profit Margin (%) of revenue as profit once expenses are paid. Because Cost Per Child/Month is inversely related to how many children are actually enrolled, a facility running below its Licensed Capacity has a higher cost to spread across fewer children and therefore needs a higher tuition rate to hit the same margin -- which is why Break-Even Enrollment (%) matters: it's the occupancy level, expressed as a percent of Licensed Capacity, at which Monthly Expenses would exactly equal revenue at the Recommended Tuition/Month rate.

Since that recommended rate already includes a profit margin, Break-Even Enrollment (%) is generally lower than the Enrollment Rate (%) you entered whenever Profit Margin (%) is above zero -- the facility usually has room to lose some enrollment below its current level before tuition revenue stops covering costs. Because both Licensed Capacity's actual head count and the break-even head count are rounded to whole children, this relationship can invert at the edges -- a very small facility, very low occupancy, or a very thin profit margin -- where rounding a fraction of a child up or down outweighs the margin itself; don't rely on the "always lower" pattern for small facilities running near-full or near-empty. This model assumes uniform tuition across every enrolled child and a fixed expense base that doesn't change with enrollment level, which is a simplification real facilities should adjust for variable costs like staff-to-child ratios.