“Now, we know.”
The phrase might be appearing on T-shirts worn by the staff at Itty Bitty City LLC.
Fawn Rechkemmer, owner and creator of the children’s play center, says those three words sum up the first year in business.
“There have been lots of surprises, really,” she says.
Rechkemmer and the Itty Bitty City managers have found themselves saying, “Now, we know,” so much that she’s joked about printing the shirts.
They completed year one in mid-October. Though centered on the creative play concepts with a kid-size firehouse, interactive water table and a theater stage, it’s been a year of learning what works and what doesn’t work in the market, she says, speaking like the young entrepreneur she is.
“There isn’t a guide or model for this type of business,” Rechkemmer says.
For instance, she says the Itty Bitty 500 baby crawling race took off really well, and they’re planning a second, but themed workshops didn’t gain traction with members.
“How has nobody in Springfield ever done a diaper derby before?” she remembers thinking.
Rechkemmer seems to welcome trying just about anything once – all for the sake of learning – and this inaugural race had four fast crawlers. The Itty Bitty team plans to build on that through social media promotions.
The membership numbers, on the other hand, have met expectations, and there’s currently 130 people paying the annual membership fee, which starts at $200 per child. But there are still adjustments expected.
“Those are just now starting to turn over,” Rechkemmer. “We still have lots of big question marks.”
Rechkemmer and her husband, Dr. Craig Rechkemmer of Little Grins Dental LLC, invested less than $1 million turning a vacant unit in Kickapoo Corners into a kid-size community. Toddlers can hold classes in a schoolhouse, serve diners in a cafe, and dabble in an art and science studio.
They bought the itty-bitty buildings from Pennsylvania-based Lilliput Play Homes, after lengthy research.
Those infrastructure-type items don’t come cheap – upwards of $30,000 for custom playhouses or the elaborate water table. Handwashing stations, much appreciated by the parents, cost $3,000 apiece, she says.
Startup capital was secured through OakStar Bank’s U.S. Small Business Administration loan program.
“Those funds were used for infill and startup. Now we’re running with our own budget,” Rechkemmer says.
The steadiest sales, about 60 percent, come from general admission day passes – $9 for kids 1-12 years old and $3 for the accompanying adult. She says birthday party bookings, about 35 a month, are a solid second revenue source, and after that, memberships, classes and field trips are lumped together.
She considers the first six to eight months in business the honeymoon phase.
“We don’t have our trends nailed down yet,” she says.
Acknowledging Itty Bitty City has a conservative business plan, the owner says it’s met expectations.
They’re planning 10-15 percent revenue growth in the second year, she notes, declining to disclose annual figures.
“The cash flow game is another thing in year two we’ve got to figure out and see where we can tweak. The flow is so roller coaster, we’re trying to find strategies and ways to even that out,” Rechkemmer says, pointing to admission fluctuations due to weather and school schedules.
Education and experience
One first-year pivot that may add to the bottom line is the addition of classes for the youngsters.
“Our main goal is to provide educational and valuable experience,” Rechkemmer says.
The teaching stars aligned for sign language instructor Bethany Hornbeck. She already frequented Itty Bitty City as a nanny for young children, so when Hornbeck started Signing Time Academy in October, she approached Rechkemmer about classes.
“At that time, behind the scenes, they were interested in adding more classes,” says Hornbeck, a Missouri State University graduate in psychology and deaf education studies.
Itty Bitty City already offered a music therapy class by Leslie Jones of Musical Bridges, and Rechkemmer welcomed the signing class addition. Both classes are offered two days a week, for $5 per child.
Hornbeck has six years of experience working with those with disabilities, at Camp Barnabas, The Arc of the Ozarks and Preferred Family Healthcare.
For Rechkemmer, the classes are an added value to Itty Bitty City customers but not a direct revenue source. The teachers receive the full class fees. But Hornbeck sees students and parents opting to pay for general admission, too.
“A lot of the kiddos want to play afterward or before,” she says.
The Itty Bitty City staff comprises mostly part-timers with an interest in early childhood education. Two full-time managers, Hayley Budd and Jessica Dahlheimer, oversee the “playologists” who work on the floor.
“They have that interest in working with kids already engrained in them,” Rechkemmer says of the team. “It’s definitely a different setting than a classroom or internship. They get to learn about interacting with kids and their parents.”
She stresses the city is not a babysitting service, a common misconception, and acknowledges the challenges running a children-centered business are worth the rewards.
“They know when they come here, they’re going to have fun but it’s also an educational opportunity,” she says. “Kids are learning as they’re playing.”
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