Windermere Family Day Care Case Study 2015


IMPACT SNAPSHOT

Jobs created: 6.3 FTE managing family day care, 74 educator contractors

Proportion of revenue that comes from trade: 30-35%.

Stage of the enterprise:  Partially sustainable

Geographical reach: City of Port Phillip, City of Bayside and Shire of Cardinia


ABOUT WINDERMERE FAMILY DAY CARE

Providing affordable and flexible childcare to meet community needs

Windermere Family Day Care is a social enterprise operated by Windermere Child & Family Services, the largest independent community service organisation in South East Victoria. Broadly, Windermere provides counselling, housing and family support services, disability services and child care to the disadvantaged and vulnerable in its communities.

To enhance its financial independence and respond to a changing funding environment and community needs, Windermere took over the Shire of Cardinia’s family day care scheme in 2004.  Since then it has operated as Windermere Family Day Care (WFDC), a fee for service enterprise where child care is provided by a qualified educator within their home. This form of childcare is flexible, less expensive and enables the needs of the family to be matched to the right educator. They also offer care for children with additional needs that is provided in the family home.

“10 years ago the number of early learning centres in the south-east region was low, and accessing good quality child care was an issue for many families. Family day care is an accessible, flexible, and less expensive model than an early learning centre, and since its inception, it has fitted in really well with Windermere’s existing services,” says CEO Dr Lynette Buoy.

Business model

Windermere’s Family Day Care runs under the National Quality Framework, and until recently, was supported through the Commonwealth Department of Social Services in the form of operational subsidies.

Like all other providers, WFDC has had to reconsider its funding model in response to changes in operational subsidies for family day care services from June 2015. In Windermere’s case equates to the loss of approximately $400,000 of funding p.a. They are adapting capably to the new operational landscape, and with the support of Social Traders, the Family Day Care program is currently transitioning to become a fully sustainable market-based business.

“We have elected to take on this business offering,” says Dr Buoy. “We are doing it on the basis that we can make Family Day Care a viable business offering that enables us to use any profits to provide other services into the community.”

There are currently 6.3 (FTE) Windermere employees managing the program. It employs over 74 child educators to provide home based care. These educators work as contractors with a capacity to earn up to $70,000 p.a.  At present, around 35% of WFDC’s revenue comes from fees for its services.

Making a difference

WFDC’s educators provide 1,400 hours of quality home based childcare per fortnight to around 470 children aged from birth to 12 years. It is harder to quantify the benefits provided to the educators for whom out of home employment is impossible, and to families for whom centre based and within office hours care is unsuitable or not accessible.

A new outlook with Social Traders

Working with Social Traders, Windermere have been preparing for the significant changes they face in funding. The collaboration involves 8 senior staff including the CEO, General Manager, Marketing and Finance heads. “It has been a really significant part of our planned growth, development, and commercial understanding of Family Day Care as a business,” says Dr Buoy.

“Understanding the early childhood sector on its own is not enough,” observes Dr Buoy. “We have to understand the critical components of our business – not only now, but in 12 months’ time. When we were subsidised by government, we had a balanced cost centre. Now we have to ensure that the new income and expenditure models are balanced.”

Identifying profitability

Social Traders have helped Windermere identify how to use existing resources to their fullest capacity. At one stage we thought that the more educators we had, the better off we would be,” says Dr Buoy. “We found that it’s the utilisation of those educators that is the most important part of the equation.”

With the same overheads for each contractor, Windermere recognised that highly functional educators were those able to care for the mandated level of children on a daily basis, attracting more income to the program through fees. This provided solid utilization targets for their business plan.

With a pragmatic growth strategy WFDC is now working towards full sustainability. Operating with a deficit budget over the next 12 months, Windermere has developed a plan to build up a small surplus using a minimum of 80 educators, and make a reasonable contribution to corporate overheads once the breakeven point has been reached.