First Research US Industry Profile

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Child Care Services
SIC Codes: 8351
NAICS Codes: 6244
Last Quarterly Update: 4/8/2019
Companies in this industry provide supervision and educational programs for pre-school and school-age children. Major US companies include Bright Horizons Family Solutions, KinderCare Education, and Learning Care Group; major companies based outside the US include Smallsteps (The Netherlands), G8 Education (Australia), and Elbkinder (Germany).
Global demand for child care services and early childhood education is growing as a result of increases in the number of women in the workforce and the number of single-parent families, as well as reduced poverty and improved health services. Nearly 90% of 4-year-olds are enrolled in preschool in countries that belong to the Organization for Economic Co-operation and Development (OECD). Growth in demand for child care services may come from countries such as China, India, and Mexico, which have ambitious goals to increase preschool enrollments.
The US child care services industry includes about 54,000 commercial facilities with combined annual revenue of $27 billion, plus about 21,000 facilities run by nonprofit organizations with combined annual revenue of about $14 billion.
Competitive Landscape
Demand is driven primarily by growth in the youth population, and secondarily by employment and income. Recognition of the importance of early education is also driving demand for high-quality care. The profitability of individual child care facilities depends on good marketing, reputation, and efficient operations, as well as how saturated the local market is. Large companies have economies of scale in advertising and administration. Smaller companies can compete effectively in local markets by owning convenient locations. The US industry is highly fragmented: the top 50 companies generate less than 20% of revenue.
The number of families with two working parents is increasing. In 2016, 65% of mothers with children under the age of 6 participated in the workforce in the US, according to the Bureau of Labor Statistics. Child care centers compete directly with nannies, many of which are employed full-time and don't live on premises.
Products, Operations & Technology
Most commercial child care services companies operate centers that are open to the public, but some operate employer-sponsored centers for employees’ children. ... plus:
Sales & Marketing
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Finance & Regulation
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Regional & International Issues
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Human Resources
Also includes the following chapters:
Quarterly Industry Update
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Industry Indicators
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Business Challenges
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Trends and Opportunities
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Call Preparation Questions
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Financial Information
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Industry Forecast
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Industry Websites
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Glossary of Acronyms

Historical Profiles (PDF format)

01/07/2019
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