How to Compete Against Unregulated Caregivers

6a0133f3fc5805970b01bb07a7ce8a970d-320wiIt’s not easy trying to attract new parents to enroll in your family child care program.

You are competing against other family child care providers, child care centers, school-age programs, Head Start, and unregulated caregivers.

When competing against unregulated caregivers, you have some special challenges.

I am defining unregulated caregivers (also called exempt care, kith and kin, relative care or informal providers) as those who are not in violation of state child care licensing rules. They don’t have to follow all of the regulations that a licensed family child care provider must follow.

I’m not talking about child care programs that operate illegally, in violation of licensing rules. I believe illegal providers should be convinced to become regulated or they should be forced to shut down. See my article, “A Plan to Eliminate Illegal Child Care.”

Parents use unregulated caregivers for many reasons: it’s usually cheaper, it may be provided by a relative, or they may know the caregiver from their community. Some parents don’t know the difference between regulated and unregulated care.

You should assume that when a parent looking for child care contacts you, she is also considering using an unregulated caregiver.

Here are some suggestions for how to compete against unregulated caregivers:

Safety – Parents’ number one concern about child care is safety. Therefore, when talking to prospective parents you should emphasize that being regulated means you and your home have passed a series of safety tests, including criminal background checks, first aid and CPR training, fire department inspections of your home, and adherence to safety standards, such as the proper storage of hazardous materials in your home.

Say to the parent, “If you are considering enrolling your child in another home, ask if that caregiver is licensed. If not, ask if they are trained in CPR and first aid? Do they have any history of criminal activity or sexual abuse? Do they have an emergency evacuation plan?”

Fees – Informal caregivers probably charge less, perhaps significantly less, than you. Do not try to compete on the basis of price. There will always be providers with lower rates than yours, and you can be successful even while charging higher rates.

Say to the parent, “If you are looking for the cheapest care in town, that’s not me. My rates are based on the quality of care I offer and the safe and healthy environment I provide for your child.”

Value – Stress the value of your services by promoting the benefits of your program. Tell the parent what advantages you offer to children that unregulated programs don’t offer.

Say to the parent:

“I offer a variety of planned learning and play activities that will help you child be ready to succeed in school.”

“I have specialized training in child development so I can respond quickly to meet your child’s needs.”

“I offer special services (piano lessons, second-language exposure, numerous field trips, computers, etc) that will enrich your child’s education.”


Parents who can see that you offer high-quality child care will pay for it. It’s your job to show them. See my podcast, “How to Identify the Benefits of Your Program.”

You can’t appeal to every parent. Some will always pick the cheapest care. Let those parents go. People usually get what they pay for. Parents who pay bargain-basement rates will get bargain-basement care.

What ideas have you used to compete against unregulated caregivers?

Tom Copeland –

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Marketing smallFor more marketing ideas, see my book Family Child Care Marketing Guide.

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10 replies

  1. Please don’t paint with such a broad brush. I am a big fan of yours and I am also an unregulated provider. I happen to have a Bachelor’s degree in Early Childhood Education and I would say my program is as safe and nurturing as someone else in my state who decided to become licensed to care for more children (and the families whose children I have cared for for years obviously agree). I am operating legally, I just don’t have an interest in caring for more children than the 6 that I could legally take (my group is usually about 3-4). I voluntarily take CPR, pay for my own background checks, attend continuing education classes and conferences, and am a member of NAEYC. I use your books to help me pay taxes. The parents in my program carefully research their options and although I am not cheap, they chose me and I am proud of that. I am curious as to why we should welcome people who knowingly break the law and operate illegally into the profession, but try to shame people who live in kith and kin states? Perhaps you are thinking of the relative who “babysits” and perhaps doesn’t have experience or training in child development. Other licensed providers tell me they regret going that route. If I lived in a state where it was required, I would get license. I just haven’t found enough evidence to justify doing it when I don’t have to.

  2. Thanks for your comments. I don’t believe I was shaming unregulated providers. I was giving advice to licensed providers on how to compete with unregulated providers. I do object strongly to illegal providers and my article linked to a previous article I had written about how to address illegal care. Also, there are excellent unregulated caregivers (and you sound like you are in that group). I tried not to downgraded unregulated care, but I apologize if my effort failed.

  3. a regulated facility is not always the safest way to go. Im not regulated and have provided excellent care for over 30 yrs. Now the young providers say a college thats such a load of crap. Nothing is better than experience and a love for children. u cant find Thatin ur books .I will be retiring in the next few months and writing a book about my Daycare. a comedy 0f course. In the meantime dont SCHOOL these children to death , let them be kids for small amount of time they get to!

  4. Eunice, your observation was not correct. I also am unregulated, but legal in my state. I follow most of the steps in licensing and also. Have gone to college for business and taking child education classes. Mr Copeland was not shaming unregulated providers at all. If your program is as good as you say it is, then this article shouldnt offend you and you should have nothing to worry about.

  5. Its not the unregulated providers that I have a problem with, it’s the illegal ones. In Nevada you can only watch one child unless licensed.

  6. Well I’m regulated provider in Iowa there is a lady across my house that just opened her UNREGULATED in home daycare and I don’t believe she even had papers to live or work in the United states it’s not fair I have to take all these classes pay insurance ect

  7. I know a lot of licensed childcare providers that do not put as much time and energy into their jobs as I do. I spend my free time reading articles about how to help each child with their individual needs. I’m a former preschool teacher that he frustrated with the academic push. I know what I’m doing. We never watch TV. We eat healthy. My home is safe and sanitary. I’m tired of the stigma of refusing to get licensed. I’m in several childcare provider groups andi listen to the other providers complain about all that comes with licensing and then look down on me for not doing it.
    I never will.

  8. Although I see the message here loud and clear on the legalities of child care provision I do not believe that regulated care means quality in the area of love, tenderness, understanding, and respect. The school system is a good example of regulated child care (under the guise of education) and we still have some teachers that follow the rules but their heart is far form the child. Same thing with nursing or doctors. When selecting child care…in addition to the facility being regulated, look for characteristics of love and respect for the child being cared for. It’s a heart thing.

  9. This is a very interesting topic. The information that you are providing Mr. Copeland is very useful. Knowing your competition enables you to compete. Recently some of us were discussing exempt/relative care using CACFP. Many questions came up and most of them people didn’t have answers for.
    The other interesting observation to me were the comments that you received, defintely a sensitive subject.
    For me, Its like the drivers that drive without a drivers license and/or car insurance. If a person has a drivers license or car insurance, it won’t necessarily make them a better driver. Its required, plain and simple, if its not required, so be it.
    There are reasons for regulations, not always sound but nevertheless rules and regulations that all people should follow if the rule or regualtion is going to work.
    Thank you for being the person that brings up important topics that need to be discussed.

  10. hey Tom I was asked the following: I am interested in the marketing materials. I wonder if there is a template we could use and make a brochure with why quality regulated care is important with an imbedded link to bright futures site where families can use the info to find all regulated childcares.

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