There are approximately 1,650 supervised and registered day care centers and approximately 2,300 family care centers holding the “Kindergarten Seal”. There is no exact data regarding unregistered and unsupervised care centers. During the 2001/2002 school year, 385,076 children aged 0-6 were cared for at 13,481 kindergartens. Of them, 298,273 children at 11,210 Ministry of Education kindergartens, 69,058 children at 1,500 Ministry of Labor and Welfare day care centers, and 17,745 children at 672 private kindergartens.
Day care center (with or without the “Kindergarten Seal”)
A day care center is an educational care facility providing for 20 or more children aged 0-3 (some day care centers have a kindergarten class intended for 4-year-old children.
Family care centers (registered or unregistered)
A family care center is an educational care facility providing for 5 children aged 0-3. A family care center is operated at the caretaker’s home with guidance and supervision of the Family Care Coordinator.
Private kindergartens (registered or unregistered)
AN EDUCATIONAL CARE FACILITY PROVIDING FOR 15-35 CHILDREN AGED 3-5. It is also called a nursery school.
Kibbutz operated kindergartens (registered or unregistered)
The kibbutz provides educational care for relatively small groups of children AGED 0-5.
Private kindergartens are divided to 9 levels according to Ministry of Education criteria, in proportion to the kindergarten teacher's experience and certification and types of equipment at the facility. This criterion also serves to determine suitable tuition fees. These criteria can be viewed at the Ministry of Industry, trade, and Labor website:
Only private kindergartens will be discussed in this profile.
- Private kindergartens usually operate throughout the year apart from a two week hiatus in August. Some private kindergartens are operated as summer camps during the summer, and some kibbutz kindergartens activity is conducted with no vacations apart from holidays.
- Kindergartens with 10 or more children aged two or more are subject to the School Supervision Law. This supervision includes, in part, supervision over facility and health conditions, curriculum, and tuition fees. Kindergartens operating during late afternoon hours are not subject to tuition supervision for late afternoon.
Customers: Defining the Target Market and Its Size, Market Segmenting
Potential customers are parents of children aged 0-6. The market can be segmented as follows:
- Geographically- kindergarten goers usually reside within a few minutes of driving distance from the facility.
- Socio-economic- as income level increases, parents will prefer to send their children to private kindergartens.
- Parents’ occupation- If both parents hold full-time jobs, children will be sent to a kindergarten active throughout late hours of the afternoon.
- Educational stance- according to educational, religious, or other stances.
- Workplace- A growing number of large organizations are establishing kindergartens in or around the workplace. Tuition is subsidized and is considered an employment benefit.
There is a wide variety of competition which includes other private kindergartens, municipal kindergartens, family care centers, day care centers, and private nannies.
- Creating a relative advantage by specializing in a field- natural, vegetarian, special curriculum, etc.
- Reputation- many children are enrolled following recommendations or as a second child from the same family if parents were satisfied with the education of the first child.
- Active marketing: pamphlet distribution and advertising in local print.
- Approaching organized groups.
- Establishing an internet site for the kindergarten and displaying hours of operation and special activities.
Many kindergartens are based on continual enrollment of children for a period longer than one year. This is possible when there is more than one age group, or when the kindergarten skips to the next age group with its students.
Factors Affecting Success
Reputation is the main parameter for success and primarily includes the kindergarten teacher’s professional and personal reputation. A good reputation ensures referral of new generations and the facility’s future success.
Regulations specify required HR according to the number of children and their age:
- A kindergarten with children aged 15 months to 2 years (up to 24 children) is required to employ one certified kindergarten teacher and two nannies (in essence, at least one certified kindergarten teacher is required and one caretaker or assistant for every 8 children)
- At private kindergartens, the customary ratio (due to competition) is one caretaker for every 5 or 6 children.
- A kindergarten with children aged 3-4 (up to 35 children) is required to employ one certified kindergarten teacher and one caretaker (if more children are present, another worker is required for every 12 children) A kindergarten teacher’s certification is received after successful completion of training and studies at a kindergarten teacher's seminary or certification studies. Seminary studies may count towards the completion of a bachelor's degree in education.
Kindergarten equipment can be divided according to mandatory equipment and supplementary equipment according to a detailed list assembled by the Department of Education at the Ministry of Education and Culture.
Industry Revenue and Profitability
Tuition at full day private kindergartens may reach a maximum of 2,200-3,000 NIS per month per child.
Average expenditure per child for a full day in 2003 (including food and materials but not including staff wages and curriculum) was approximately 21 NIS.
Kindergarten profitability depends on many variables such as location and cost of rent, type of population in the area, number of children, age groups, investment in equipment, competition in the area, etc. It is estimated that profitability is approximately 35-45% of revenue.
Typical Terms of Payment
Monthly payment conducted through the bank or checks.
Payment terms vary according to business relationship and acquisition amount– up to EOM+60.
Licensing and Certification:
No local authority licensing is required, however if the kindergarten is established within a residential area, a permit is required for deviant usage.
Licensing is required by the Preschool Supervision Department at the Ministry of Health and the Ministry of Education.
Israeli Private Kindergarten Organization, Dizengoff 125, Tel-Aviv. Phone: 03-5225929
Ministry of Education, Culture, and Sport- Preschool Supervision Department, Dvora Ha'Nevia 2, Jerusalem. Phone: 02-5602934
A new kindergarten’s success greatly depends on supply and demand in the area. Therefore, a kindergarten should be established where there is a shortage of kindergartens and day care centers, and must try to avoid competition in the public sector and with well-established kindergartens.
Parents usually visit the kindergarten prior to enrollment in order to check its suitability. Parents are interested in the staff's professionalism, treatment, hygiene, equipment level, and variety of toys. Parent involvement continues throughout the school year. This should be accepted and even taken advantage of.
It is recommended to carefully assess any increases in tuition that are higher than prices customary in the area. Tuition has a strong effect on choice of kindergartens.
The Ministry of Industry, Trade, and Labor's website:http://www.tamas.gov.il/NR/exeres/1C3AB132-3A1E-43EC-B1BD-D522B4E36C7F.htm
Kindergarten website: http://www.ganeyyeladim.co.il/default.asp
It is recommended to utilize the aid of your local Business Development Center branch in establishing and operating the business.
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