How Indonesia Daycare Market is positioned?
Indonesia is an island nation with a population size of ~ million in the year 2016. The overall Java region (West Java, Central Java and East Java) has majorly contributed to the demand of daycare centers in the country.
Daycare centers provide services that can be opted for monthly basis, daily basis or hour based subscriptions for full day or half day programs charged against a nominal fee which varies on the basis of type of daycare and program selected. Both organized and unorganized market provides daycare services which fulfill the demand for urban and rural areas of the country.
Growing awareness among parents regarding the early childhood education of their children coupled with increasing working population of the country have driven the demand for daycare centers in Indonesia.
Indonesia daycare market generated revenues worth USD ~ million in the year 2011. The revenue generation increased to USD ~ million in 2012 which were evident from a massive growth rate of ~% in 2012 owning to high employment growth in daycare centers.
The number of day care centers in Indonesia was witnessed to increase from ~ in 2011 to ~ in 2013. The increasing proportion of children in daycare also reflects large gains in the number of mothers who are working due to rising education levels and middle class aspirations, thus making daycare essential for their children. Indonesia daycare market attained its highest revenues in the year 2016 accounting to USD ~ million majorly due to daycare services provided by high schools for teen parents.
Indonesia Daycare Market Segmentation
Based on region, daycare market in Indonesia is classified into Java, Sumatra and other regions. Java region dominated the Indonesia daycare market by capturing ~% of total revenues in 2016. It has been witnessed that both parents in the workforce is an economic necessity for many families living in Java region owning to growing number of households and urban population in the country. Approximately 57.5% of total Indonesian population resides in urban areas of Java region, constituting 32,220.6 thousand households in the year 2016. Sumatra region followed overall Java in Indonesia daycare market in 2016. Easy availability of daycare centers along with rising living costs and changing lifestyles make childcare necessity in Sumatra region. Tutor Time, La Petite Academy, ABC 123 Daycare, Kountry Kare, Lyman Exteriors LLC and Farmers Union Insurance – Steve Plaggemeyre are some of the major daycare centers in Sumatra region.
By Java Region
Based on overall Java region, daycare market in Indonesia is classified into West Java, Central Java and East Java. West Java region dominated the overall Java daycare market by capturing ~% of total revenues in 2016. The daycare centers in West Java region were evaluated at ~ centers and charge an average price of USD ~ per day.
On the other hand, Central Java and East Java accounted for ~% and ~% respectively of total revenues earned through daycare centers in overall Java region in 2016.
By Type of Daycare Memberships
Based on type of daycare, Indonesia daycare market is classified into monthly, daily and others. The package type also differs on the basis of age group. It has been witnessed that average price to handle babies is more in comparison with toddlers. Monthly daycare segment dominated the overall Java daycare market by capturing ~% of total revenues in 2016. Monthly membership plans are preferred by parents who work full-time and can opt for full/half daycare services. The monthly package provided by daycare centers includes a well defined curriculum where a certain schedule of activities are followed from morning to evening, On the other hand, daily and other daycare types accounted for the remaining share in 2016.
By Type of Program
Based on type of program, daycare market in Indonesia is classified into full day, half day and other types. Full day segment dominated the Indonesia daycare market in 2016. Growing awareness about early childhood education development among parents and provision for government subsidy on daycare programs has led majority of the parents to opt for full day daycare programs/services in Indonesia. On the other hand, half day and others such flexi programs and emergency daycare services for the remaining ~% of total revenues in 2016.
Trends and Developments in Indonesia daycare Market
Increasing number of women working for pay has made it harder for parents to raise their children. Improving women’s access to employment and removing workplace discriminations is driving the demand for daycare centers in Indonesia. Furthermore, it has also been witnessed that working mothers are increasingly opting for freelance consultant in the corporate world where they can manage work and their children both at the same time.
Various hotels situated in Bali and others offer their own on-site childcare services for visitors on the premises. They not only arrange outside babysitting or nanny services through their concierge, but offer a variety of other special amenities and services that specifically cater to the needs of children.
Subsidized day care basically refers to providing on site / near site company child care which is one of the Work Life Balance (WLB) policies that is provided by various organizations in Indonesia. Providing Child care facilities for employees is intended to help employees with children, so that they can manage their office work or adopt for flexible working options
Various daycare centers also provide the option of flexible child care services to fit individually family needs. Drop-in, flexible care allows parents to get the quality they seek in their child care during the hours they need it.
Issues and Challenges in Indonesia Daycare Market
Daycare is not a common choice for some parents in Indonesia majorly due to their personalized choice for keeping a nanny or child care provider in the home. Easy availability of nanny coupled with low cost is posing a major threat to the growth of daycare centers in Indonesia.
In Indonesia, it is very common to have co-residence with one’s parents or in-laws or even extended families that could provide assistance in doing household work and taking care of the children. In accordance with the collectivistic culture followed in the country, it is both a duty and a pleasure for grandparents to take care of their grandchildren, thus affecting the daycare market in the country.
Various attempts made by parents to register their infant child for daycare centers carry a long lasting period to find a daycare center within the vicinity of their corporate offices. The waiting list often extends up to five to six months which leaves them helpless and creates a fuss for parents during that period.
Comparative Landscapre in Indonesia Daycare Market
Indonesia daycare market is highly fragmented with the presence of several players such as Baby Kangaroo Indonesia, Paradise Baby, Little Elephant, High Reach, Little Sunshine, Little March Daycare, Tsabitha Daycare, Pondac Bocan Daycare, Qarnain Daycare, Dandelion Daycare, Cler Merby Daycare, Love and Care Baby Daycare; Puste Blume Daycare, Daycare Lil Illr, Arjuna Daycare and Nisreen Daycare. Growing importance of early childhood education coupled with increasing number of working parents in Indonesia have led to rise in demand for daycare centers in Indonesia. The services provided by daycare centers are differentiated in terms of a good reputation, a stimulating curriculum, flexible ground rules, staff qualifications, safe and clean environment; and other benefits. The Indonesian parents have showcased positive attitude towards investing in their children at an early age, thus paying for social, educational and economic dividends over the course of their child’s lifetime.
Future Outlook and Projections in Indonesia Daycare Market
In Indonesia, early childhood education comes in a variety of forms. It can be a daycare center, a playgroup, an early childhood education center integrated with a health post, a program for families with children, a Quran learning center or an Islamic kindergarten, catering to the need of different age groups.
The Indonesian government is continuing its efforts to provide an early childhood education for children from poor families. The governments challenge is to ensure that they too receive proper childcare services in future.
Over the forecast period, Indonesia daycare market is expected to generate revenue of USD ~ million in the year 2019, thus growing by ~% in comparison with previous year.
In Indonesia, majority of households have young children which do not include an elderly family member, so there is likely a demand for childcare services among women in these households.
Developing policies and programs that facilitate access to childcare has the potential to increase women’s labor force participation in near future. The blue print of the Early Childhood Education (ECE) 2025 was and initiative launched in 2011 by the Ministry of Education which mentions the poor quality and competency of teachers. Moreover, to improve teachers’ quality, the government plans to provide scholarships, training, and internships, by investing a significant amount of funds.
Daycare market in Indonesia is expected to generate revenue of USD ~ million by the year 2021, thus growing at a five year CAGR of ~% for the estimated period 2017-2021.
Companies Cited in the Report
List of Companies Companies Covered in the Report
Little Elephant Daycare
Umalas Kids Club Major Players
Little March Daycare
Club Merby Daycare
Key Factors Considered in the Report
Comprehensive analysis of Indonesia daycare market and its segments
Listed major players and their positioning in the market
Identified major industry developments in last few years and assessed the future growth of the industry.
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Ankur Gupta, Head Marketing & Communications