Is the childcare market slowing your centre down? Here’s what I’d check first

When occupancy drops, it’s tempting to look for one explanation.

The market is quiet. Another centre has opened. Families are worried about fees. The marketing isn’t working.

Any of those could be contributing. The question is which ones are affecting your centre, and what you can actually do about them.

Recent national childcare figures give owners a reason to look closely. But before you change your fees or ask for more advertising, I’d start with what’s happening between a family needing care and a child starting at your centre.

What does the new childcare data tell us?

The Department of Education’s June quarter 2026 report shows that families using centre based day care fell by 2.6% compared with the same quarter last year, within the report’s analysis group. Over the same period, the number of centre based day care services increased by 2.9%.

The family figures relate to the report’s group with Customer Reference Numbers, rather than every family who attended an approved service. These are national figures, not a measure of your local occupancy. Service numbers also don’t tell us how many staffed places are available.

Source: Department of Education, Child Care Subsidy data report, June quarter 2026.

My takeaway? Check whether local demand and competition have changed. Then look at how well your centre is responding.

1. Are fewer families enquiring, or are fewer enrolling?

These need different responses.

Start with enquiries, tours booked, tours attended and enrolments. Then check how many children actually started and which days they booked.

Compare a consistent period with the same time last year where reliable records exist. Give recent enquiries time to progress, and follow the same families through the stages. Dividing this month’s enrolments by this month’s enquiries can mislead you if those enrolments came from earlier enquiries.

If enquiries have fallen, investigate local demand, visibility and whether your message reaches families needing the places you have.

If enquiries are steady but tours aren’t happening, look at the response, the conversation and availability. If families tour but don’t enrol, investigate what remains unresolved.

The numbers tell you where to ask questions. They don’t automatically tell you who is at fault.

2. Do your empty places match what families need?

“We have vacancies” isn’t specific enough to plan around.

Which rooms? Which days? From when? And can those places actually be offered with your current staffing?

For example, a centre could have Friday vacancies while most enquiries ask for Tuesday and Wednesday. That’s an illustrative scenario, but it shows why an overall occupancy percentage can hide the problem.

Record the care families request, including enquiries you cannot accommodate. Then make sure your advertising and website accurately describe the availability you can offer.

More enquiries won’t necessarily solve a mismatch between the places available and the care families need.

3. Do you know why families choose another centre?

This can be uncomfortable, particularly when you’re proud of your team.

But if families keep choosing elsewhere, you need to understand their decision.

Ask without trying to argue them out of it:

“Thanks for letting us know. If you’re comfortable sharing, what made the other centre feel like the better fit?”

Record what families actually say. Look for patterns around location, available days, fees, relationships or how comfortable they felt during the visit.

Review nearby centres’ public information too. A new building tells you competition has arrived. Feedback tells you more about why families are choosing it.

4. Are you explaining value in a way that matters to that family?

One family wants their child to build confidence. Another is thinking about starting school. Another needs reassurance about settling into care.

You won’t discover that by talking through the same list of inclusions on every tour.

Ask:

• “Why are you looking for care at the moment?”
• “What are you hoping your child will get from being here?”
• “Is there anything you’re worried about?”

Then show how your everyday practice responds to their priorities. If settling is their concern, explain the actual transition process and how educators communicate with families.

Explain fees clearly as well. Affordability can be a real constraint; a better conversation won’t make every place affordable. The aim is to understand the concern, not assume every hesitation is about price.

5. Is your team equipped to follow through?

Before deciding you have a centre manager problem, check what the manager has to work with.

Is someone responsible for each enquiry? Is the conversation recorded? Is there a clear next step? Does the team have the time and training to follow up properly?

A CRM helps make this visible, provided people use it consistently.

After a tour, a useful follow-up acknowledges what mattered to the family, answers outstanding questions and explains the next step. It should respect their timing and contact preferences.

Also check departures and reductions in booked days. New enrolments can arrive while occupancy stays flat because existing families are leaving or using less care.

What I’d do this week

Sit down with your director and bring three things: your room-by-day availability, your enquiry records and your recent departures or booking reductions.

Agree on the clearest problem, one action to address it, who owns it and a review date. Check that the action happened promptly; allow enough time for families to move through the enrolment process before judging its effect.

The national picture matters. Your next decision still needs to reflect what is happening inside your centre and among the families you serve.

If you’d like help working out where to focus, get in touch about an occupancy review. We can look at the whole process together and identify what deserves attention first.