Dog Daycare Business Plan: The 2024 Getting Started Guide

Easy Busy Pets

June 4, 2024

Are you ready to embark on a journey of starting your own doggy daycare? Perhaps your love for canines is unparalleled, or maybe you have identified a gap in your community and are eager to turn it into a profitable venture. Whatever the motivation, the road to opening your doors to the furry friends is paved with several crucial steps.

This guide serves as a comprehensive roadmap, providing an in-depth look at the important factors to consider when drafting your dog daycare business plan. By the end of it, you'll have a clear understanding of the foundation required to turn your ideas into reality.

While this guide covers the essentials, there is still much to delve into. You can navigate to specific sections if you already have a good understanding of what you're searching for, or continue reading from start to finish to gain a better understanding.

Get ready to give your furry friends a safe and comfortable home away from home!

How to Start a Doggy Daycare Business?

Before starting your dog daycare business, it's essential to have a clear understanding of several tried and tested concepts as it applies to building a business case and plan. To ensure a solid foundation for your new pet care business, you should begin by creating a detailed financial business plan.

Profitability calculations will help you establish a path that best suits your situation and goals. To be able to make such calculations, you need to think about a few key questions:

1. What is my mission or goals?

2. What is my branding and marketing strategy?

3. What kind of competition am I up against?

4. What location should I build my dog daycare business?

5. What licenses, rules and regulations should I be aware of?

6. How much money can I earn running a doggy daycare?

To investigate steps 1-5 a little further, check out our article about starting doggy daycare business before reading on.

This article focuses on (the 6th step) the creation of your dog daycare business plan.

So how much can you earn running a doggy daycare? And is it worth it? Let's find out.

Will your dog daycare business be profitable?

Excitement and passion are key ingredients in customer relations and happy pets, but without the bread & butter of regular income, namely a net profit that will sustain you, there is no path forward for the long term. Realizing this sooner than later, at least theoretically, is a great thing - you can find out quickly if you should spend the next 7+ years of your life on this project.

Luckily it's an easy process to find out.

And we've made it even easier with a detailed calculator below. But first let's learn a little bit more about what we need to find out and plug into this tool.

To ensure profitability in your dog daycare business, it is crucial that the revenue generated from customer payments surpasses the costs associated with providing those services.

Expected Costs:

Rent
Marketing
Repair
Maintenance
Salaries & Commissions
Software
Dog food & Treats
Other

For example: to calculate total monthly staff salaries: (# of staff ) x ($ staff hourly wage) x (# of hours per week) x (4.345 Weeks Per Month) x (# of Doggy Daycare Locations)

Note: There are on average 4.345 weeks per month in a given year.

Expected Revenues:

Doggy Daycare
Boarding
Grooming
Pet Sitting
Products

For example: to calculate the Doggy Daycare Revenues: (Full-Day Daycare $ Rate) x (# Full-Day Services Completed Per Week) x (4.345 Weeks Per Month) x (# of Doggy Daycare Locations).

Managing the numerous variables involved in operating a profitable dog daycare can be a challenging task. However, by using the appropriate equations and considerations, you can better understand and manage these factors.

The Costs

A doggy daycare business incurs various costs as it operates and strives to generate income.

These costs can be categorized into two broad categories: Selling, General, and Administrative (SG&A) expenses and Cost of Goods Sold (COGS).

SG&A expenses are indirect costs that are not directly tied to the production of goods and services, such as salaries (facility workers like reception or cleaning staff, marketing and advertising expenses, legal and professional fees, rent and utilities, and other administrative expenses.

COGS, on the other hand, includes the direct costs associated with producing and selling goods, such as materials, labor, and overhead expenses directly tied to the production of services. More specifically, a professional groomer working out of your doggy daycare facility receives 70% commission for any revenue you make from their services. This would go into the COGS.

Both SG&A and COGS are important metrics for measuring a company's financial performance and profitability, as they provide insight into the efficiency and success of a company's operations.

Calculating Profit from Revenues

You have plans to start a doggy daycare business that includes the works: Dog Daycare, Boarding, Grooming and Overnight Sitting. Each of these categories will provide a share of your total revenue. Some categories, like the grooming or pet sitting, will require you to payout a commission to your professional groomers or to pet sitters that board some of the pets in their homes, and these folks are usually not on a salary.

Over a period of time, usually monthly:
Gross Profit = Total Revenue - Cost of Goods Sold (COGS)

Gross profit is a key financial metric that measures a dog daycare's profitability after accounting for the direct costs of producing and selling its goods or services. It is calculated as the difference between total revenue and the Cost of Goods Sold (COGS). Gross profit is expressed as a dollar amount and as a percentage of total revenue, and provides important information about the success of a doggy daycares core business operations.

Gross profit is calculated by subtracting COGS from total revenue. For example, if a business generates $100,000 in total revenue that month and its groomers and pet sitters take a commission of 70% which is $70,000, its gross profit would be $30,000 ($100,000 - $70,000).

Gross profit is an important metric for evaluating a company's financial performance and profitability because it provides insight into the efficiency of a company's operations.

Net Operating Profit

Net Operating Profit represents Gross Profit after accounting for all indirect costs associated with running the business, such as marketing expenses, salaries, rent, and utilities.

Over a period of time, usually monthly:

Net Operating Profit = Gross Profit - Indirect Costs (SG&A)

Net Operating Profit is a measure of a company's profitability that takes into account all operating expenses associated with running the business. It represents the amount of money a company earns after deducting all costs involved in producing and selling its products or services.

Net Profit

The net profit equation also known as income, is a simple formula that is used to calculate the profit or loss of a dog daycare business. It is a crucial tool for determining the overall financial health of a dog daycare business over time and helps owners make informed decisions about the future direction of the pet care business.

The net profit equation is calculated as follows:

Over a period of time, usually monthly:

Net Profit = Net Operating Profit - Non-Operating expenses

Listed below are the more common non-operating expenses that a doggy daycare business owner needs to consider:

Interest expenses: This includes interest on loans or other debts the company has taken on.
Taxes: This includes any taxes the business may have to pay, such as income tax, property tax, or sales tax.
Depreciation: This is an accounting expense that reflects the wear and tear of the company's assets, such as its building, equipment, and vehicles.
Losses from investments: This includes losses from investments the company may have made in other businesses or financial instruments.
Legal fees: This includes fees associated with any legal matters the company may be involved in.
Bad debts: This includes any debts that the company is unable to collect from customers.
Amortization of intangible assets: This includes the expense associated with the gradual reduction in value of intangible assets, such as patents or trademarks.

How To Price Your Doggy Daycare Business?

With many reasons to price high or price low we can at minimum find out what pricing you need to start with to get positive net profit.

When the net profit is positive, this means that the business is making more money than it is spending, but even then you need to consider whether the amount is worth your while.

If the net profit is negative, the business is losing money, and it is important to identify the reasons for this loss and take corrective action (maybe you overestimated a cost or underpriced a service or two).

Don't worry if all the above equations and factors seem complicated - Easy Busy Pets has taken care of everything for you. Our Doggy Daycare Profitability Calculator is here to help you analyze your approximate profits with ease.

Start your profit analysis now!

Key Factors For A Winning Dog Daycare Business Plan

A successful dog daycare relies on the following key factors to execute a winning dog daycare business plan:

✅Strong Branding

Having a good brand can help you stand out in a crowded market and attract new customers. It is important to create a consistent image and messaging that aligns with your dog daycare business's values and goals.

✅Understanding Competition

Knowing your competition is crucial in developing a successful strategy. You should conduct market research to understand the strengths and weaknesses of your competitors, as well as identify opportunities to differentiate your business and offer unique services.

✅Location, Location, Location

Choosing the right location for your facility is also crucial for a dog daycare business. You should consider factors such as accessibility, visibility, and parking availability when selecting a location. Additionally, it is important to ensure that the location is in a safe and secure area for both dogs and employees.

These concepts are further discussed in a sister article about starting a doggy daycare business.

✅Modern Doggy Daycare Software

One of the most important steps you can take early on to be successful is to chose the right software solutions to run your business efficiently and which has a proven model to help you and your Team engage with your pet owners seamlessly.

The pet care service industry is booming, and there's a lot of competition as a result of that. Businesses that surpass all their competition achieve this managing and streamlining their day-to-day operations thanks to pet centric software or a collection of multiple apps for their dog daycare, kennel, and dog / cat grooming services. For example, Easy Busy Pets is a comprehensive software solution that offers features such as appointment scheduling, client management, automated billing and a pet owner portal. Having the right software in place can help improve efficiency, increase customer satisfaction, and drive business growth.

Here at Easy Busy Pets, we are dedicated to delivering the ultimate dog daycare software experience for business owners like you. If you're looking for a top-notch solution to streamline your doggy daycare and grooming operations, don't hesitate to reach out to us. Our team is ready and eager to provide you with more information and help you take your business to the next level. Contact us today!

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