Well, I just have cats. But MY advice is have a room with NO distractions. No radio, TV, cell phones, internet. If they NEED to use the internet they should ask you, and the computer THEY use should be in your plain sight.
You should supply them with a snack and drink when they request it. (think of this as a office atmoshphere)
Supply them with the tools they need to finish their work. This is NOT a prision! But it is a work environment. YOU are the manager.
Take control. Be realistic, firm and helpful.
The room should be well lit, with comfortable chairs and have fairly decent desks.