Cost per child — total operating cost over enrolled children — is the break-even benchmark for tuition. Tuition below cost per child means the center loses money on every seat.
The example
$96,000/month, 80 children.
| A | B | |
|---|---|---|
| 1 | Item | Value |
| 2 | 96000 / 80 | — |
| 3 | Per child | → $1,200/mo |
The formula
The formula:
How it works
How it works:
- Sum operating costs — payroll (the big one), rent, food, supplies, insurance.
- Divide by enrolled children for the per-child cost.
- Compare to average tuition: tuition must exceed cost per child to profit.
- Fixed cost per child falls as enrollment rises — empty seats raise everyone’s cost.
Empty seats raise the cost of every filled one. Most childcare cost is fixed (staff and rent), so spreading it over 80 children versus 60 is the difference between profit and loss at the same tuition. Cost per child at full enrollment is your true break-even; at partial enrollment it’s higher. That math is why enrollment and ratio efficiency — not tuition hikes alone — usually drive a center’s bottom line.
Try it: interactive demo
Operating cost, children, average tuition.
Variations
Margin per child
Tuition − cost:
Break-even enrollment
Children to cover cost:
Cost per child at full
At capacity:
Pitfalls & errors
All operating costs. Payroll, rent, food, supplies, insurance.
Same period. Cost and enrollment over the same month.
Zero children. No enrollment gives #DIV/0!.
Practice workbook
Frequently asked questions
How do I calculate cost per child in Excel?
What's my break-even enrollment?
Why does enrollment affect cost per child?
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