February 2024 Parenta magazine_compressed

Improving the
business of
Dr. Allan Presland
childcare: part 2
Many years ago, my daughter was
attending the after-school club of a local
chain of nurseries. She had been there for
about 4 months before I realised that I’d
never received an invoice and therefore,
had never paid. The owner was not only
a client but also a friend of mine, whom
I bumped into often - and during our
regular chats, I asked multiple times if he
was sure he was correctly invoicing for all
the services he was providing. Of course,
he was adamant he was!
When I saw him over the next couple of
months, I asked the same type of question
and always got the same answer;
everything was being billed correctly. Of
course, a little while later, it became too
embarrassing to avoid paying any longer
so I met him and paid my dues – the
point is however, the owner had revenue
leakage and simply wasn’t aware of it.
As part of Parenta’s commitment to
supporting settings, we run surveys which
provide a series of questions that allow
providers to compare their performance
against the most successful settings. One
of the questions is about revenue leakage,
and 25% of respondents said they didn’t
know what this was.
In last month’s column, I talked about the
importance of lead generation and the
true value of a lead to you being worth
£50,000. But (and this is really important)
there is simply no point in continuing to fill
a bucket with water when it has a hole in
the bottom, no matter how small.
This analogy may sound frivolous, but
it’s the exact opposite. Having worked
with so many providers over the last 25
years, my suspicion is the vast majority
have some form of revenue leakage from
their business. Simply, they are either not
billing, or not billing correctly, and more
importantly, they are not receiving the
income due to them.
Nursery management software is an
absolute necessity to solve this problem,
but even then, I would urge all owners/
managers to pull every single invoice
for the last month and to check them all
thoroughly against hours/sessions used,
late payments and late collection fees, as
well as extras. Unfortunately, this is not a
job that can be passed to someone else –
you need to satisfy yourself that everything
is 100% correct.
If I’m wrong and you find everything to
be 100% correct, congratulations, you are
one of the few. If I’m right, fix the issue fast
and set a calendar reminder to repeat the
exercise in 6 months.
You may also want to grab a copy of
my book, “Improving the Business of
Childcare” which has many similar
hints and tips, available here on
www.amazon.co.uk here, or take
our quiz to see how successful your
setting is compared to others we work
with: https://scorecard.parenta.com/
parenta
Call 0800 002 9242 and quote ’Magazine’
6 February 2024 | parenta.com