Choosing the Right Daycare Ownership Model for Your Church

In today’s world, churches are reimagining how they serve their communities-and how they sustain their ministries. With more families than ever seeking reliable, values-aligned childcare, churches are uniquely positioned to meet this need. Opening a daycare on your church campus doesn’t just create a new outreach opportunity-it can also generate long-term financial stability and deepen your connection to young families.

But before you leap into launching a childcare center, you’ll need to answer one of the most important questions: What’s the best ownership model for your church?

 

There are three primary options:

1. Partnering with a childcare franchise
2. Leasing to or collaborating with an existing provider
3. Owning and operating your own church-run center

This guide unpacks each model, outlining the financial, operational, and spiritual implications to help your church make a confident, mission-aligned decision.

 

Model 1: The Franchise Route

Your church partners with a nationally recognized childcare brand, operating under their system and guidelines in exchange for fees and royalties.

Key Benefits:

• Turnkey Operations: Franchises offer comprehensive training, curriculum, branding, and administrative systems-reducing the burden of building from scratch.
• Brand Trust: A well-known name can attract families who value consistency and quality assurance.
• Faster Setup: Most franchise programs provide a launch timeline, guiding you through licensing, staffing, and marketing.

Consider the Trade-Offs:

• High Cost, Ongoing Fees: Start-up costs typically range from $200K to $500K. Ongoing royalties can be 7-11% of gross revenue. A center generating $2.3M per year might pay over $250K annually-money that could otherwise support your ministry.
• Faith Limitations: Most franchises do not permit faith-based curriculum or religious programming, meaning you may not be able to integrate prayer, scripture, or spiritual conversations.
• Restricted Identity: You’re joining their brand, not building your own. Church identity may be lost in the process.

 Real Example:
Initial Investment

• Franchise fees typically range from $50,000 to $135,000, depending on the brand.
• Total upfront costs-including build-out, licensing, equipment, and training-usually range from $600,000 to over $1 million, though smaller setups can cost around $300K-$800K .

Royalty & Marketing Fees

• Ongoing royalties typically fall between 5% and 10% of gross revenue.
• Many franchises also add a 1-3% marketing or brand development fee.

Example Impact- For a center generating $2.3 million annually:

• Royalties (7-10%) = $161K-$230K
• Marketing fees (1-3%) = additional $23K-$69K
• Total ongoing fees = $184K-$299K per year

 Best For:
Churches that want a quick launch, have funding available, and are okay with limited customization or spiritual integration.

 

Model 2: Provider Partnership

The church leases space to or co-creates a program with an experienced childcare provider, who handles operations in exchange for a percentage of revenue or rent.

Key Benefits:

• Low Risk, Low Effort: Your church provides space and support, but the provider takes on daily responsibilities.
• Faster Revenue Flow: This model often gets off the ground quickly with minimal church involvement.
• Shared Mission Possibilities: With the right partner, you might influence culture and curriculum-though usually to a limited degree.

 

Consider the Trade-Offs:

• Smaller Long-Term Returns: If your provider pays $6,000 per month in rent or revenue share, that’s $72,000/year. Meanwhile, a church-run center of similar size could net $400K-$600K/year after expenses.
• Less Control: You may have little say in how the children are cared for, what curriculum is used, or who is hired.
• Value Drift: If your provider doesn’t share your church’s core values, the culture may clash over time, leaving families confused about who’s in charge.

 

Real Example:

One church partnered with a local, non-franchise childcare provider and leased 6 unused classrooms during the week. The provider paid $6,000/month in rent, totaling $72,000/year. Over 7 years, the church earned $486,000 from the arrangement.

However, had the church operated the center themselves, based on similar-sized programs, they could have netted $500,000-$600,000 per year-meaning they missed out on $3 million+ in revenue during that same timeframe. Plus, they had no spiritual influence on daily activities.

 

Best For:

Churches seeking to activate unused space with minimal investment or that lack the leadership capacity to oversee full operations.

 

Model 3: Church-Owned and Operated Daycare

Your church launches and manages its own center-developing the brand, hiring staff, creating the curriculum, and overseeing daily operations.

Key Benefits:

• Total Mission Alignment: Every policy, classroom, staff member, and lesson plan reflects your church’s heart, beliefs, and calling.
• Deep Community Engagement: You build long-term relationships with young families, many of whom may not otherwise step inside your church
• Scalable Growth: Once your first center is running successfully, you can replicate the model at future campuses or partner churches.
• Strong Financial Potential: Churches operating their own centers often see net profits of $300K-$600K per year, which can be reinvested into ministries or used to fund church staff, building projects, or outreach.

 

Consider the Trade-Offs:

• Greater Complexity: Licensing, hiring, budgeting, and quality control all fall on your team.
• Upfront Investment: Expect $150K-$350K in startup costs for facility upgrades, licensing, staff recruitment, and curriculum materials.
• Leadership Load: Without experienced advisors or support, it’s easy to get overwhelmed by the operational demands.

 Best For:
Churches with a strong sense of calling to reach young families, a vision for growth, and a willingness to build something fully aligned with their ministry.

 

How to Choose the Right Model

Before you commit, spend time prayerfully and strategically evaluating these four dimensions:

1. Mission Fit

• Can faith be fully integrated into the curriculum?
• Will the model support discipleship, outreach, and community-building?
• Does it align with your church’s long-term vision?

2. Financial Picture

• What are the short- and long-term financial gains of each model?
• Can you fund the initial investment or partner with donors?
• Will ongoing costs be sustainable in lean seasons?

3. Operational Capacity

• Who on your team can lead or manage the center?
• Can you handle licensing, HR, and compliance internally?
• Will outside consultants or a management company be needed?

4. Community Demand

• Is there a childcare shortage in your neighborhood?
• Do families desire faith-based options?
• What ages, schedules, or programs are most needed?

 

 

Implementation Tips by Model

Model	First Steps	Pro Tip
Franchise	Research franchise options, review contracts, negotiate alignment terms	Choose a franchise with strong cultural compatibility-even if not faith-based, look for shared values like compassion and integrity
Partnership	Define roles, create a formal lease or operating agreement, clarify expectations	Vet the provider thoroughly and require quarterly check-ins for accountability
Church-Owned	Hire a project team or consultant, begin licensing process, design your brand	Start small with one or two classrooms and grow as enrollment increases

 

Final Thoughts: Building More Than a Business

A church-run daycare isn’t just about filling classrooms-it’s about forming lives, building bridges, and serving the community in one of the most meaningful ways possible.

When done right, your center becomes a ministry outpost, a financial engine, and a beacon of hope to young families seeking support. No matter which path you choose, let your decision reflect not only what’s easiest, but what’s most aligned with your calling.

 

💡 Does Your Church Have Empty Rooms During the Week?

What if those unused classrooms and hallways could become a powerful ministry AND a source of sustainable income?

At Child Care Biz Help, we specialize in helping churches like yours transform unused space into a thriving, faith-based childcare center that blesses your community and fuels your mission. Here’s how we help:

✅ FREE Facility Evaluation – We’ll assess your current space and show you exactly how it can be reimagined for licensed childcare.
✅ Earning Potential Breakdown – We’ll forecast how much your church could earn each year based on your layout, demographics, and program options.
✅ Mission-Aligned Strategy – We’ll help you design a program that reflects your church’s values, reaching young families and planting seeds of faith in the next generation.
✅ Turnkey Support – From licensing to hiring, curriculum to compliance, we walk with you every step of the way.
✅ Sustain Long-Term Growth – Beginning six months after launch, we offer optional consulting services through our Sustainability Phase. These ongoing Childcare Management & Marketing Services support continued enrollment growth, operational excellence, and a faith-filled environment where the love of Jesus continues to touch families’ lives.

Let us help you become better stewards of the space God has entrusted to you-

Turning square footage into transformed lives, kingdom impact, and long-term sustainability.

👉 Call us TODAY to schedule your FREE church space assessment today!