Financing your children’s nursery will require careful planning and money management. Anyone embarking on setting up a new children’s nursery business will have to do their due diligence and make sure the capital required to start the venture is achievable and the ongoing costs of running the operation have been accounted for.
This should not be a deterrent though. There are plenty of viable children’s nurseries who have financed their business correctly from the start and now have a successful business model. Following some guidance on getting your finances in order will be essential before starting a children’s nursery.
Write a Business Plan
This can be the first hurdle that stops people from progressing with their nursery business. But with some time and effort and covering the key areas within a business plan they provide a solid platform for you to start financing your children’s nursery from.
A business plan will enable you to gain a better understanding of what will be required to make sure your nursery is a profitable business. It will include areas such as what will your prices need to be in order to make a profit after calculating all of your overheads and operating costs.
Knowing how many children you will need in your nursery to meet these costs will also be essential. It is your opportunity to really get down to the detail and be really clear on what financials will be involved before even having to reach for a cheque book or apply for a grant.
Having clarity around your future finances within a business plan will give you the tools you need so you are fully prepared and aware of what is involved.
Grants and Start-Up Help
Support for financing your children’s nursery could be available but this is an area that is always under review so you would need to check with your local council to find out what support might be available for you. Financial support is often based on the location of your nursery and the age group of the children you will be caring for.
In order to make an application for any childcare grant you will need to make sure you are registered with the Early Years Childcare and Extended Schools Service (EYCESS).
Raising finance to set up your nursery can be done in a variety of ways. You may have your own money that you have saved towards the venture, or have family, friends, or perhaps potential business partners who are going to provide some financial support.
Other options might be to consider financing your project through online peer to peer lending or crowd funding. If these types of finance seem like a viable option to you then research the pros and cons of them so you are clear on what is involved.
However whatever method you are considering for financing your children’s nursery will need to be properly accounted for and if you are paying back such finance then you need to make sure you are in a position to pay it back and still make a profit.
Be super clear on your numbers, how much will you have to raise? Are you prepared to secure any borrowing against your home for example?
Managing Daily Finances
Managing finances is not everyone’s area of expertise or comfort. If you are someone who dreads managing the books then ensure that you outsource this to someone who is suitably qualified. There is nothing worse that attempting to manage the finances amongst all of the other activities you will be responsible for and failing to do it properly. Just don’t take the risk and always seek help with your finances if you know it is an area of the business that you will struggle with.
The typical daily financial activity you can expect to cover are:
- Recruitment fees for staff
- Maintenance of premises
- Purchasing of Toys, food and other essential items
Renting and Leasing
When purchasing items such as play equipment, you can arrange to make payments for these in instalments rather than one large lump sum. These are usually set up through a leasing, higher purchase or some other form of rental agreement. You will need to speak with the company providing such arrangements and be clear on the length of the payment plan and that you are comfortable with the costs.
The area of finance is large and when financing your children’s nursery it is a vital component of making sure you have a viable nursery that is financially strong and making a profit.
I hope this blog has helped give some initial guidance on this subject and you have found it useful.
If you have any comments or feedback then I would be delighted to hear from you.
The Nursery HR People
Less HR More Learning!