Running a successful childcare business involves managing a large amount of administrative tasks, especially when it comes to billing. Money can be a sensitive topic for families and your billing and payment systems can be complicated and time-consuming. By optimizing your childcare billing process for efficiency, you can save yourself and your families valuable time and reduce costly errors. 

This article will provide practical tips for faster and more efficient childcare billing. We'll cover how to make payments more convenient for families and how to streamline your internal billing system by taking advantage of automation.

Read on for ten ideas to implement now.

Childcare billing tips for families

Making billing as effortless as possible for families is not just about enhancing efficiency at your childcare center; it's about demonstrating care and respect for the families you serve, ensuring that their experience with your center is seamless and stress-free from start to finish.

1. Enforce your policies

• Your grace period
• What happens if families miss a payment
• Whether families can lower the number of hours a child is in your care mid-session

If a problem with payment occurs, it can be tempting to give families some leeway, especially if they have a long relationship with you. But in reality, that makes things messier for them, other families, and you. If other families discover that you haven't applied your policies the same way across the board, they may expect leniency or feel favoritism is at play, which can affect future relationships at your center.

It might feel uncomfortable to enforce your policies, but remind yourself that doing so is the fairest option to you, your staff, and all families at your center.

2. Let families pay digitally

Make it easy for families to pay for child care by offering digital payments. Digital payments are more convenient than cash or checks, as families can pay from anywhere as soon as they receive your bill.

Digital management systems empower even a small childcare center to offer digital payment options. A tool like brightwheel's billing feature can help you accept and manage digital payments from credit cards or directly from bank accounts, and gives families the option to view and pay their invoices at any time. Removing barriers from making payments can help you collect more timely payments from busy families.

3. Send regular reminders

• Put up a sign on your door
• Remind families verbally at pick up or drop off
• Send children home with paper notes
• Automate a reminder email

You will be doing your families a favor when you take the time to remind them to pay their bills. These simple reminders can help prevent late payments and ensure your center gets paid on time.

4. Include late notices with daily reports

A late notice in the “notes” section of a daily report form is easy for staff or a manager to write, and confidential for families to read. Additionally, families know to look at the “notes” section for important information. By incorporating a late payment reminder into this form, you avoid handing a parent yet another sheet of paper at the end of the day that can end up lost or crumpled.

Of course, this isn't the only way to deal with late payments. If you have a lingering outstanding payment or chronic problems with a family forgetting to pay, a small daily report note alone will not solve your problem. However, a reminder the first day after payments are due can be a good nudge in any payment grace period—remember, everybody slips up sometimes and forgets important tasks, and parents are no different.

5. Communicate early

While you must be fair and consistent in enforcing your payment policies, working with families to identify and solve problems before they become a larger issue is the best way to approach sticky situations. If you notice a recurring problem collecting payments from a family, have an open and honest dialogue with them early on.

Arrange a time to speak to a parent face-to-face. Emails and push notifications are great for reminders, but speaking with parents directly can sometimes be the best way to raise concerns and come up with a solution. It will be a tough conversation, but a necessary one, to ensure your facility can provide excellent care for every child.

Tips for streamlining your childcare billing process

Streamlining your childcare billing process significantly boosts operational efficiency, fosters trust with families, and paves the way for a thriving childcare business.

6. Automate invoices

Automation can save your staff time and reduce paperwork every month, because it eliminates the need for them to spend time doing recurring administrative tasks. When it comes to billing, automating invoices can be a simple way to streamline your childcare billing system each time a payment is due.

One way to do this is to set up a recurring payment plan for families, which are simple to create in a system like brightwheel. Brightwheel automatically generates invoices for your families that are set up with a recurring payment plan, and you choose when those get sent to families. Keep in mind that automated invoices differ from automated payments, in that automated invoices notify families that their bill is due, and automated payments make a withdrawal automatically.

7. Automate payments

Autopay is not just convenient for families, it's also a great tool for lightening your administrative load. With automatic payments, families can set up their card or bank account to be charged on a certain day of every month to cover the cost of child care.

This can help you get in more payments on time every month, which makes your life easier. Knowing every payment will be automatically made at the end of your billing period means you can get down to balancing your books, and spend less time following up on outstanding payments.

A digital billing system can also improve your internal business practices by allowing you to track and manage payments in one centralized system, giving you visibility into completed or outstanding payments.

8. Prioritize security

When evaluating payment processing software for your business, it's important to choose a vendor that prioritizes security to ensure your families' information is always safe.  Then, you can emphasize these safety and security features to families when they sign up for your digital payment system. When you send out reminders or notifications for payments, reiterate that your system is safe with a statement like, "You can make a payment with our secure online system.”

If a family is worried about the safety of your payments, they may waffle between checks and cards, and put off logging into your online portal. By helping families trust your billing system and feel comfortable with their digital safety, you're removing a barrier to speedy, regular payments.

9. Consider offering partial payments

Giving families flexibility to make partial payments can reduce amounts owed at the end of billing periods. Every family's budgeting and finances are different, and allowing partial payments can help families stay in good standing with your center each month. Some families will appreciate being allowed to pay when they can over the course of your billing period, rather than waiting to hand over a lump sum.

10. Take attendance digitally

If you calculate payments based on the number of hours or days a child was at your center, taking attendance digitally significantly reduces how much time you spend calculating who owes what.

Not only can you automatically see hour and day tallies for children in a digital attendance system, but when you use a digital system that can handle both attendance and billing, you centralize your pertinent information in one place. You can effortlessly go from seeing how many days a child attended to pushing out an invoice without touching a calculator or a calendar.

Optimize your business

Your mission as a childcare provider is to give children the best place to play, explore, and develop. In order to do this, you need the financial side of your business to be in order, and that means creating an efficient billing system. By investing in digital solutions, making payments easy, and prioritizing consistent, early communication with families, you are setting your program up for success.

Brightwheel is the complete solution for early education providers, enabling you to streamline your center’s operations and build a stand-out reputation. Brightwheel connects the most critical aspects of running your center—including sign in and out, parent communications, tuition billing, and licensing and compliance—in one easy-to-use tool, along with providing best-in-class customer support and coaching. Brightwheel is trusted by thousands of early education centers and millions of parents. Learn more at mybrightwheel.com.