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buying a day nursery

(10 Posts)
MadameJ Thu 23-Oct-14 16:40:17

Our local nursery has recently come up for sale and I am seriously considering it. I'm currently a sahm but have plenty of childcare experience.
Can anyone offer advice about things I need to consider or should be asking the current owner.

Tia

Petallic Thu 23-Oct-14 16:44:04

Ask to meet with the early years business support team at your local authority. They will be able to tell you where the demand is on your area and for what type of places, what projected future child numbers are for the next couple of years and if there are any other businesses in the pipeline who will be opening in your area. I would ask a lot of questions as to why the business is currently for sale - My experience of nurseries is it is hard to turn a profit unless you are part of a chain or are relying on a lot of trainee (and low paid) staff - your main outgoing will be staff costs.

MadameJ Thu 23-Oct-14 16:48:51

Thank you, that's really helpful.
The current owner wants to retire and move abroad but she hasn't really being hands on for a while now, she is currently paying a full time manager so there arr definite savings to be made there!

KatyMac Thu 23-Oct-14 16:56:56

Do you have the right qualifications

Will the existing staff be TUPE'd across & therefore need redundancy if you were to replace them

Does it take LA funding for 2, 3 & 4 year olds

MadameJ Thu 23-Oct-14 18:30:44

Yes I have actually managed the nursery in the past.

Not sure about the 2nd question??

Yes it accepts funding.

Artandco Thu 23-Oct-14 18:37:42

I would consider. However I would look at making big changes if currently not a great success.

Look closely at area/ type if people using it etc.

Ie here in Central London, a nursery offering smaller places but care 7am-7pm is much more successful than one doing 9-5pm. People also happy to pay more for smaller numbers/ better quality of food/ space/ toys etc

KatyMac Thu 23-Oct-14 19:39:52

When you buy a business you buy the staff and their rights to redundancy (TUPE - here?)

So if you manager has been there more than 2 years & is over (I think) 40 she gets a fair amount of statutory redundancy plus any written in to her contract

MadameJ Thu 23-Oct-14 20:43:40

Thank you everyone, you have given me plenty to think about which is a good starting point smile

KatyMac Thu 23-Oct-14 21:29:25

Good luck with it

I know you will sort out audits of the accounts and all that sort of stuff - but you may need to re-DBS everyone if there is a change of ownership (I'm not sure)

You will need new quotes for PLI/Employer's insurance & I'm sure your accountant will look at things like savings accounts to cover maternity/sick cover as the insurance for that is very high now

Plus a lot of local authorities require Nurseries to hold cash reserves for redundancies - so it might be worth checking that out.

The building might be leasehold or freehold or even just rented and that will affect the price too

broodylicious Tue 04-Nov-14 21:20:57

Defo worth considering!! And as a former PR manager for a very well known nursery chain and PR and events manger for a smaller but known brand, pls let me know if you need help in marketing smile

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