EXPERT HELP
It pays to take professional advice and read widely before you start up a nursery.
Consultancies
* Sandra Brouet, a childcare development consultant, runs Childcare Plus, Unit 11, First Floor West, Universal House, 88-94 Wentworth Street, London E1 7SA, tel: 020 7247 6338, info@starting upchildcare.co.uk, www.startingupchildcare.co.uk.
* Busy Bees, as well as owning a network of nurseries, can help develop facilities either in partnership or on behalf of large companies: The ROM Building, Easter Avenue, Litchfield, Staffs WS13 6RN, tel: 0870 380 6614.
* Childcare Partners has expertise in helping employers decide on childcare strategy, particularly in the area of partnership schemes with local communities: Buffer Bears, Head Office, The Hospitium, Valpy Street, Reading RG1 1AR, tel: 0118 950 3200.
* Mark Dudek is a specialist advisor on all aspects of the early years environment: 4 Westbourne Grove Mews, London W11 2RU, tel: 020 7792 1984, www.educationdesign.co.uk.
* POPITS can provide assistance with nursery Ofsted procedures and standards: 25 Rockington Way, Crowborough, East Sussex TM6 2NJ, tel: 01892 664526.
* Trio Childcare Connections can help with getting a nursery started, Ofsted problems etc: Newburn Centre, Newburn Crescent, Swindon SN1 5ES, tel: 01793 514422.
Childcare and professional organisations
* Kids' Club Network, Bellerive House, 3 Muirfield Crescent, London E14 9SZ, tel: 020 7512 2112, www.kidsclubs.co.uk.
* National Day Nurseries Association, Oak House, Woodvale Road, Brighouse, West Yorkshire, tel: 0870 774 4244, www.ndna.org.uk.
* The Pre-school Learning Alliance, 69 Kings Cross Road, London WC1X 9LL, tel: 020 7833 0991, www.pre-school.org.uk.
* Scottish Independent Nurseries Association, 60 Mollins Burn Street, Hyde Park Business Centre, Springburn, Glasgow G21 7SF, tel: 0141 557 3040.
Publications
* Nursery World, priced 1.30 a week, includes news, regular management features and curriculum guidance (subscription hotline, tel: 01454 642480).
* Starting a Nursery - A practical guide for early years professionals by Martin Pace (Nursery World, 8.99, tel: 01454 617370).
* Starting a Day Nursery resource pack (National Day Nurseries Association, 15, tel: 0870 774 4244).
* Starting a Pre-school factsheet, included in the group membership pack (Pre-school Learning Alliance, tel: 020 7833 0991).
* Starting and Running a Nursery - the business of early years care by Helen Jameson and Madelaine Watson (Nelson Thornes, 18, tel: 01242 267268).
* Building for Young Children by Mark Dudek (Education Design, 10, tel: 020 7792 1984).
MARKET RESEARCH
You will need to demonstrate that you have conducted market research if you are to gain funding to set up your nursery. Market research is to show that the area you have chosen has enough children to support your nursery, will enable you to charge a high enough fee and will enable you to fill your nursery quickly enough and stay full so you can make a profit. Research will also help define the service you are to offer.
* Look around the area for evidence of young families - primary schools, children's shops.
* Your local Early Years Development and Childcare Partnership (EYDCP)/Children's Information Service (CIS) are a good source of information.
* Contact major employers to establish whether they have a need to provide childcare for their employees.
* Prepare a questionnaire and conduct a survey of what age of children people have, where they live and what childcare they use. This helps gauge demand and publicise your nursery.
* Research your competition to establish whether the nurseries are full and what services they offer.
Contacts
* CACI is a market research company: Kensington Village, Avonmore Road, London W14 8TS, tel: 020 7602 6000.
* Childcare Link can provide details of your local CIS, tel: 08000 960 296, www.childcarelink.gov. uk.
* Experian is a market research company: Garden Floor, Bain House, 16 Connaught Place, London W2 2EP, tel: 020 7664 1157.
BUSINESS PLAN
Your business plan should include:
* Executive summary - include key objectives, financial objectives, level of funding needed.
* Sector analysis - a brief explanation of the nursery marketplace.
* Market analysis - your market research.
* Operational plan - your business objectives and how you expect to achieve them, ethos, opening hours, age groups etc.
* Management team - outline staff identified and recruitment plans.
* Implementation plan - what you will do during start-up including securing premises, recruitment, marketing.
* Financial information - predictions about how your nursery will develop financially.
* Appendices - the back-up for your financial data, any relevant press cuttings, management CVs, market size data.
* Banks can often provide you with business plan formats for reference.
FUNDING
Types of funding There are two types of funding:
* Debt (or loan capital), which you borrow from a lender such as a high street bank, and
* Equity, which means selling a share of your business to a business partner, even though it has not yet begun trading.
Most businesses usually operate with a mix of debt and equity.
Sources of funding Debt: The easiest and quickest source is through family and friends. If you know someone with enough capital, do not be afraid to discuss your proposal.
They may expect a share in the business, in which case it will become equity funding.
A bank may be able to consider a loan if you already have some capital or assets of your own, or if you have taken on an equity partner.
Even if you have no capital, it is useful to see your bank manager for advice on loan schemes available to business start-ups such as the Government Loan Guarantee Scheme.
Grants are another source of business funding, but the sources are very few. If you are aged under 30, the Prince's Youth Business Trust is a good place to start enquiring and your local Learning and Skills Council may also offer advice on how to source low-cost or free money.
Equity: A new business is unlikely to attract venture capital, so the best source of equity finance is a 'business angel'. This may be someone with business experience and money to invest who is keen to get involved in a profitable business. They may want to work with the business on a part-time basis, bringing valuable skills with them.
Business angels listen out for potential investments through a network of contacts and, for a fee, you should be able to access that network through either the local Learning Skills Council, Business Link, or through a number of private agencies called financial intermediaries (fees range from around Pounds 500 upwards). You can access these organisations through your local authority, local chamber of commerce or your accountant.
Business angels who have worked in similar sectors to childcare, such as healthcare or hotels, may be the most easily persuaded to see the benefits of investing in a nursery, as profit margins are likely to be similar.
Pros and cons
Debt:
* The lender weighs up possible return against risk. You will be expected to put up some of the capital (for example by offering a charge on your home).
* Once you have entered into a loan agreement, you must meet repayments, irrespective of whether the nursery is making a profit.
* You retain ownership of the nursery and therefore the value of the business when you come to sell it, rather than sharing this with a partner.
You will also have a greater say in decision making.
* Debt is quicker to implement as a lender's decision is based on financial criteria, not on building up a working relationship.
Equity:
* You will only be required to pay back your funder out of profits, giving your business greater security.
* Your partner is likely to get involved in the business, which may bring new skills. If you have a mix of equity and debt, your lender may feel more comfortable with your partner's skills on board.
* You will be surrendering some of the eventual profits of the business.
* You will also be giving up some control of the running of the company and will need to work with your partner for the benefit of the business.
* Having equity funds from a partner can sometimes be a help in securing further finance from other partners or lenders.
Contacts
* Abbey National business provides commercial mortgages and loans, tel: 0800 3280210, www.anbusiness.com.
* Armada Finance provides asset funding, tel: 01392 431171.
* BDO Stoy Hayward is a financial advisor for growing businesses, 8 Baker Street, London W1U 3LL, tel: 020 7486 5888, www.bdo.co.uk.
* First National Commercial Banking provides funding for acquisition, refinance or business expansion, tel: 020 8909 4529.
* G R Patrick & Co (Finance), is a nursery finance specialist, tel: 020 8336 0030.
* The Royal Bank of Scotland has a team specialising in the nursery sector, tel: 020 7615 7072.
BUYING A NURSERY
Whether you are buying land or a building, converting a building or erecting a modular construction, you must acquire planning consent from the local authority. Ofsted will not agree to registration until provided with evidence that planning permission is in place or that planning permission is not required.
Sales agents
Companies specialising in the sale of nurseries and schools include:
* AH Lansley, 111 Oxford Road, Reading, Berkshire RG1 7UH, tel: 0118 959 0271.
* Christie and Co, 50 Victoria Street, London SW1H 0NW, tel: 020 7227 0700, www.christie.com.
* Dowling Kerr, 98 Huddersfield Road, Holmfirth, West Yorkshire HD9 3AX, tel: 01484 681314, www.dk-business.com.
* National School Transfer, Tilshead House, Tilshead, Salisbury, Wiltshire SP3 4RX, tel: 01980 621251, www.national schooltransfer.com.
* School Transfer Consultants, Haydon Cross, Dale Road, Southfleet, Kent DA13 9NX, tel: 01474 534 151, www.school transfer.co.uk.
Independent valuers
The following understand the childcare sector and are recognised by most institutions:
* FPD Savills, 25 Finsbury Circus, London EC2M 7EE, tel: 020 7499 8644, www.fpdsavills.co.uk.
* Matthews and Goodman, Dorland House, 14-16 Regent Street, London SW1Y 4PH, tel: 020 7747 8847, www.matthews-goodman.co.uk.
* Pinders, Pinders House, Milton Keynes, Bucks MK9 1DS, tel: 01908 350500, www.pinders.co.uk.
* Taylors, Court House, Mill Court, Featherstone Road, Wolverton Mill, Milton Keynes, Bucks MK12 5QS tel: 01908 226611, www.tbsv.co.uk.
Modular building suppliers
* Blackburn Barton provides a design and construction service for timber-framed buildings, tel: 020 7350 2345, www.deckhouse.com.
* Elliott Group, tel: 01543 404040, www.elliott-group.co.uk.
* Globalmobile, tel: 01892 722733.
* Homelodge Buildings, tel: 01962 881480, www.homelodge.co.uk.
* Portakabin, tel: 01904 611655, www.portakabin.co.uk.
* Rovacabin, tel: 01865 337200, www.sgb.co.uk.
* Securaccom, tel: 01285 850011, www.securaccom.co.uk.
* Speaks Building Systems, tel: 01422 353022.
* Terrapin, tel: 01908 270900, www.terrapin-ltd.co.uk.
* Tingdene Homes, tel: 01933 225157, www.tingdene.co.uk.
* Wernick Group, tel: 01792 321222, www.wernick.co.uk.
* Wraith Accommodation, tel: 01427 711238, www.wraith accommodation.co.uk.
Architects
Architects experienced in designing nurseries include:
* Birds Portchmouth Russum Architects, 8-10 New North Place, London EC2A 4JA, tel: 020 7613 1777, www.BirdsPortchmouth Russum.com.
* Cottrell & Vermeulen Architecture, 1b Iliffe Street, London SE17 3LJ, tel: 020 7708 2567, www.CottrellandVermeulen. co.uk.
* Dominic Burns Associates (architects, planning supervisors and project managers), 544a Bearwood Road, Smethwick, Bearwood, West Midlands B66 4BT, tel: 0121 429 7711, www.db-assocs.co.uk.
* dsdha, 8 Iliffe Yard, London SE17 3QA, tel: 020 7703 3555, www.dsdha.co.uk.
* Education Design, 4 Westbourne Grove Mews, London W11 2RU, tel: 020 7792 1984, www.educationdesign.co.uk.
* Russell Clayton Panter Hudspith Architects, 235 Southwark Park Road, London SE1 6NP, tel: 020 7407 2786, www.panterhudspith. co.uk.
BUILDERS
The Federation of Master Builders can recommend builders:
* Gordon Fisher House, 14-15 Great James Street, London WC1N 3DP, tel: 020 7242 7583, www.fmb.org.uk.
LEGISLATION
Care Standards
There is now one set of national care standards in England, the Care Standards Act 2000, that are enforced by the Early Years Directorate, run by Ofsted. The Act makes requirements such as space per child, staff ratios and administration.
There are four aspects to the regulation of daycare for children under eight:
* Registration: The registration process involves checks on you, your premises, and any people who look after children with you or live or work on the premises.
* Inspection: After you are registered an Ofsted childcare inspector will check the quality of your daycare provision every year. The inspector will write a report and send a copy to you so that you can make it available to parents.
* Investigation: An Ofsted childcare inspector may carry out an investigation to check that you meet the national standards and other requirements.
* Enforcement: Ofsted can take action if you do not meet the national standards and other requirements.
Before you are registered you will have to demonstrate to Ofsted that:
* Every person looking after children on the premises is suitable to look after children under the age of eight.
* Every person living or working on the premises is suitable to be in regular contact with children under the age of eight.
* The premises are suitable, having regard to their condition and the appropriateness of any equipment and to any other factor connected with the situation, construction or size of the premises.
* You comply with the National Standards, regulations and any conditions imposed by Ofsted.
You can obtain copies of the National Standards and Guidance to the National Standards from your local authority, or from DfES Publications, tel: 0845 6022260 or www.dfes.gov.uk/daycare.
The Care Standards Act 2000 is available from the Stationery Office, tel: 0870 600 5522, www.hmso. gov.uk. For Scotland, contact the Care Commission, see below.
Contacts
* Care Commission, Compass House, 11 Riverside Drive, Dundee DD1 4NY, tel: 01382 207100, www.carecommission.com.
* Department for Education and Skills (DfES), Sanctuary Buildings, Smith Street, London SW1P 3BT, tel: 020 7925 5000, www.dfes. gov.uk.
* Management Advisory can provide advice for nurseries on policies and procedures: 5-8 Edward Centre, The Horsefair, Kinckley, Leicestershire LE10 0AN, tel: 01455 444222, www.management advisory.net.
* Ofsted, 90 Union Street, London SE1 0SS. Registration helpline, tel: 0845 601 4771 (your call will be directed to your local regional centre), www.ofsted.gov.uk.
* POPITS can offer assistance with nursery Ofsted procedures and standards: 25 Rockington Way, Crowborough, East Sussex TM6 2NJ, tel: 01892 664526.
Employers' responsibilities
Terms of employment
* Employment Act 2002.
* Employment Protection (Consolidation) Act 1978.
* Trade Union Reform & Employment Rights Act 1993.
* Working Time Regulations 1998.
Advertising/Recruitment
* Sex Discrimination Act 1975.
* Race Relations Act 1976.
* Disability Discrimination Act 1995.
Pay
* Equal Pay Act 1970.
* National Minimum Wage 1999.
Further advice
* The Arbitration, Conciliation and Advisory Service produces guides on employer responsibilities, tel: 0870 242 9090, www.acas.org.uk.
* www.businesslink.org, or phone its helpline on 0845 600 9006.
* The Chartered Institute of Personnel and Development has a legal advice line, for members, tel: 020 8263 3310, www.cipd.co.uk.
Premises Regulations
* Unitary Development Plan.
* The Fire Precautions Act 1971.
* Health and Safety at Work Act 1974.
* Management of Health and Safety at Work Regulations 1992.
* Health and Safety (First Aid) Regulations 1981.
* The Reporting of Injuries, Death, Diseases and Dangerous Occurrences Regulations 1981.
* The Electricity at Work Act 1989.
* The Food Safety Act 1990.
Further advice Take advice from your local planning authority, Ofsted officer, fire officer, environmental health officer and EYDCP.
Policies To meet the National Standards these should include: Organisation
* An operational plan.
* Procedure for lost or uncollected children.
* Registration system for children and staff.
Care, learning and play
* Children's activities to develop emotional, physical, social and intellectual capabilities.
Safety
* Risk assessment.
* Record of visitors.
* Fire and emergency procedures.
* Fire safety records and certificates.
* Operational procedures for outings.
* Vehicle records including insurance and a list of approved drivers.
Health
* Administration of medication.
* Prior parental consent to administer medicines and for emergency treatment.
* Accidents and first aid.
* Health and hygiene statement.
* Sick children policy.
Food and drink
* Diet - records for individual children's dietary needs.
Equal opportunities
* Equal opportunities and anti-discriminatory policy.
Special needs
* Written policy on special needs.
Behaviour
* Policy on behaviour management.
* Incident record.
Working in partnership with parents and carers
* Admissions policy.
* Complaints procedure.
* Activities provided for children.
* Contract with parents.
Child protection
* Child protection policy.
Insurance
* Kiddicare/Pound & Gates, tel: 01473 216 406.
* Morton Michel, tel: 020 8768 6700.
* Spencer Meakin & Newbroad, tel: 01204 525279.
* Sweet William Nursery Insurance, tel: 01708 855141.
EQUIPMENT
It's advisable to make a list of the essentials you will need, using the reminders below, and set a budget - you'll need at least 10,000 - Pounds 15,000 for a 40-place nursery.
For more information see Nursery World's supplement Nursery Equipment, which is published three times a year.
Checklist
* Arts and crafts: paint, paper, glue, safety scissors.
* Modelling materials: craft tables, easels, overalls, drying racks for paintings.
* Book corner: books, seating, display shelving/storage.
* Construction: traditional wooden bricks, plastic blocks, Popoids and gear systems.
* Display: pinboard, display shelves, fabric calendar.
* Games and puzzles: shape sorters, play trays, jigsaws, simple board games, memory games.
* Music: tape recorders, rainstick, drum, maracas, xylophone.
* Outdoor play: climbing frames and swings, pop-up tent/den-making equipment, ride-on or push-along toys, safe surfacing.
* Role play: home corner furniture, smaller props, such as a cash till, telephones, dressing-up clothes.
* Sand and water: raised sandpit, water table, buckets, spades, boats, jugs, funnels.
* Small world: dolls and accessories, teddies and soft toys, miniature people sets, animals, building, vehicles.
* Toys for babies and toddlers: fabric books, ring stacker, push-along toys, rattles and teething rings, playmats, mobiles.
Equipment suppliers
General
* Asco, tel: 0113 2707070.
* Addguards, tel: 00353 128 00106.
* Early Learning Centre Direct, tel: 08705 352352.
* Eibe UK, tel: 01483 813834.
* Galt, tel: 08702 424477.
* Heron, tel: 0845 120 4525.
* Hope, tel: 08702 414400.
* M&S Mercantile, tel: 0161 236 4616.
* NES Arnold, tel: 0870 6000 192.
* Orchard Toys, tel: 0115 937 3547.
* Philip and Tacey, tel: 01264 332171.
* Step by Step, tel: 0845 300 1089.
* TP Activity Toys, tel: 01299 827728.
* Wesco, tel: 01376 503590.
Art and crafts
* Art2Go, tel: 01843 292333.
* Berol, tel: 01553 761221.
* The Consortium, tel: 01225 777333.
* Crayola, tel: 01234 360 201.
Children's books
* Letterbox Library specialises in positive image multicultural books, tel: 020 7503 4801.
* Milet publishes dual-language books, tel: 020 7603 5477.
* National Literacy Trust provides information on early years reading, tel: 020 7828 2435.
* Walker Books entitles members to discounts, tel: 020 7793 0909.
Professional books
* David Fulton, tel: 020 8996 3610.
* Heinemann, tel: 01865 888080.
* Hodder, tel: 020 7873 6000.
* Nelson Thornes, tel: 01242 267100.
* Open University Press, tel: 01280 823388.
* Paul Chapman, tel: 020 7330 1234.
* RoutledgeFalmer (Taylor & Francis) , tel: 01264 343071.
Management software
* BabyTech specialises in nursery management software, tel: 0870 4441330.
* Coldharbour Systems provides financial administration systems, tel: 01275 850500.
* Datamove, tel: 01162 375017.
* Parenta designs nursery websites, tel: 0870 747 9066.
* Rio Computers specialises in nursery management systems, tel: 0116 272 0742.
Music
* Kindescope, tel: 01623 861157.
* Music Education Supplies, tel: 020 8770 3866.
* Out of the Ark Music, tel: 01932 232250.
Play equipment/furniture
* Active Learning, tel: 0115 960 6111.
* Community Playthings, tel: 0800 387 457.
* Cost Cutters, tel: 0121 2447070.
* Little Tikes, tel: 01704 833123.
* Park Leisure, tel: 0115 937 4441.
* Plants Furniture for Education, tel: 01663 732100.
* Sherwood Industries, tel: 01623 792151.
* Sovereign Playground Equipment, tel: 01702 291129.
* Timberkids, tel: 01288 353527.
* Timberline, tel: 01246 454484.
* Wicksteed Leisure, tel: 01536 517028.
Play surfaces
* Charles Lawrence Surfaces, tel: 01636 610777.
* Happy Landings, tel: 01280 822949.
* Smith Brothers, tel: 023 9238 7198.
Role play
* Charlie Crow Costumes, tel: 01782 417133.
* J and M Toys, tel: 01274 599314.
* Let's Pretend, tel: 02890 438428.
* Multirole, tel: 01422 886589.
* Three Bears Playthings, tel: 01669 620315.
Uniforms
* Grahame Gardner, tel: 0116 255 6326.
STAFF
Preparing to recruit
Using your business plan, decide how many children you seek to enrol in the first months of the nursery's life.
Next, consulting the Care Standards Act 2000, decide how many people you will need to employ initially and what their qualifications should be.
Draw up job descriptions (duties and responsibilities to be undertaken) and person specifications (characteristics such as qualifications, experience and skills) and compose the advertisements.
Job advertisements can be placed in the sector's specialist publications, eg Nursery World, national and local press, local Jobcentres and circulated around local groups.
Appointing a manager
Appoint your manager first. Under the Care Standards Act 2000 the minimum experience is two years in a daycare setting plus a Level 3 qualification appropriate to the post. A manager needs proven managerial, communication and leadership skills.
Selecting your team
* Recruit downwards allowing your manager and senior staff to help select so you build a cohesive team.
* Pay attention to equal opportunities - treat every candidate equally without regard to gender, race, colour, national or ethnic origin or marital status. You must ensure no applicant is discriminated against because of physical disability, age, religion, sexual orientation, trade union, family or care commitments.
* Ask applicants the same questions so that when you compare candidates you are objective and can demonstrate that you treated everyone equally.
* Limit the interview panel to, at the most, three people to avoid intimidating applicants.
* Use the job description to determine the essential requirements and desirable attributes you seek. Some interviewers keep a score sheet, ticking off each applicant's possession of attributes so they can compare candidates.
* Invite candidates to spend time in the nursery to see how they interact with the children and other staff members.
* Trust your judgement.
Recruitment agencies include:
* Beresford Blake Thomas, tel: 0870 6000 892.
* Capita, tel: 0800 731 6873.
* CG Recruitment, tel: 01344 761 901.
* Firstpoint Healthcare, tel: 08457 23 24 25.
* Marylebone, tel: 020 7727 2743.
* Pertemps Solutions, tel: 020 8690 9010.
* TimePlan, tel: 0800 3588040.
Curriculum
* Learning and Teaching Scotland, 74 Victoria Crescent Road, Glasgow G12 9JN, 08700 100 297, www.ltscotland.com.
* Qualifications and Curriculum Authority, 83 Piccadilly, London W1J 8QA, tel: 020 7509 5556, www.qca.org.uk.
* Scottish Qualifications Authority, Hanover House, 24 Douglas Street, Glasgow G2 7NQ, tel: 0141 242 2214, www.sqa.org.uk.
Books
Managing Your Curriculum by Ruth Andreski and Sarah Nicholls (Nursery World, 8.99, 01454 617370).
Inclusion in this directory does not necessarily imply recommendation.
CASE STUDY
MARKET RESEARCH.
Carrie and Lee Johnson aim to open Kids in Bloom in West Derby, Liverpool next month: 'Expecting our first baby coincided with our plans to open a nursery. As prospective parents we visited 40 nurseries throughout Liverpool to find out what they had to offer, their fees and whether they were full. Every nursery had a three-to four-month waiting list.
'West Derby was particularly over-subscribed and demographics provided by our local Business Link showed a high birth rate in the area, allowing us to aim at the top end of the residential market and focus our property search.
'We approached banks for funding and needed to back up our business plan with further research so we took to the streets surveying people about their childcare arrangements and what fees they paid. We also spoke to local businesses and found many staff didn't return after having children, indicating there was a lack of childcare.
'It took about a year to find our ideal building - a Victorian coach house in extensive grounds. It is in a prominent location near Alder Hey Children's Hospital. A promotional advert in a local newspaper had no response but a sign outside the nursery has been a success. Potential staff and parents have inundated us with enquiries. Many parents have been eager to provide a deposit to secure a place for their child.
'We want parents to feel involved in the nursery and have been asking them what facilities they'd like us to provide. Requests have included highly qualified staff, a strong focus on security and safety, quality toys and learning aids, ICT facilities and organic food.
'We've printed glossy leaflets and posters promoting the nursery and are planning a leaflet drop in shops, schools and businesses within a mile radius.
'Our unique selling points are modern facilities, spacious outdoor areas and carefully planned curriculum. Although the conversion isn't complete the nursery building is also proving a great draw for us - it certainly has the "wow" factor.'
CASE STUDY
COMPILING A BUSINESS PLAN.
Chris Hodgson, business manager at Kingsclere Nurseries in Berkshire, has recently helped win a nursery tender: 'Kingsclere Nurseries owns six nurseries in Berkshire and this greatly worked in our favour when it came to applying for the tender for a workplace nursery at Arborfield Garrison in Wokingham. The first stage of the tendering process was to compile a detailed business plan -outlining financial predictions, market analysis and operational plan.
'I considered how many children the building would hold (showing the predicted income from nursery fees) and what staff we'd need (to indicate expenditure on salaries). The length of the building lease was not negotiable but I looked at the financial costs per month. Other expenditure detailed included equipment, heating and insurance bills. I produced a spreadsheet to show the predicted profit and loss over the nursery's first two years. With increased competition in the childcare market it's vital to ensure the figures tally to make a viable business proposition. From the analysis I estimate that the nursery will break even within 18 months of opening.
'We look at local nurseries each year to ensure we remain competitive, so I used this information for the market analysis. Our other nurseries in the area have waiting lists and we know there are housing estates planned. For the tender I kept our fees and salary scales the same as our other nurseries - we know it is vital to offer handsome salaries to attract qualified staff.
'To buy the nursery outright would require financial assistance but by leasing the building there are low set-up costs and we don't need to borrow money.
'Following submission of our business plan I got called in to give a presentation. I focused on the key elements of our proposal instead of regurgitating the facts and figures. Our main selling points were that we're a company of intermediate size, enabling us to have close contact with our staff and customers and deliver quality childcare. We have a pool of employees that can transfer to the new nursery and I stressed the company has 17 years of local childcare experience.
'Informally we heard we'd won the tender after a couple of weeks but it took two months before we received official confirmation. Our solicitors are now drawing up contracts and we aim to open in June or July.'
CASE STUDY
CONVERSION.
Brenda Burrows converted a former off-licence into her dream nursery, Willows Day Nursery in Kings Norton, Birmingham: 'After five years of running a nursery in hospital grounds the lease came up for renewal and I decided to search for my own property. I needed to stay in the area because I would be moving children from the original nursery. It is a heavily built-up area and I knew converting a building would be less expensive than buying land and building.
'I approached local estate agents and looked at anything - even garages! A staff member accompanied me to look at a former off-licence. She was horrified - it was incredibly run-down and the water tank had burst leaving green mould down the walls and an awful smell. But I was delighted with its potential.
'It was on the main route from Redditch to Birmingham city centre, so was visible and accessible for commuting parents. With alterations I knew it would be big enough for a 60-place nursery with all the children's rooms on the ground floor and the upstairs rooms could be converted into a computer studio. There was a big car park and land for outdoor play areas. An architect confirmed that I could extend the building. I had my offer accepted and submitted plans.
'It took around nine months to acquire planning permission with the plans sent back twice for alterations. I had to reduce the size of an extension which meant going back to the drawing board and moving a planned kitchen upstairs.
'I took great care in working out my room sizes - if there is a 3:1 ratio and a room can only fit five children there is one child's place wasted because there still needs to be two qualified staff to care for them. I wanted a lovely building but lost revenue meant I wouldn't have a viable business.
'Once we had approval the architect sent the plans to local builders for estimates. I chose a middle price range and was very happy with the builder. We were able to work together and he stuck to the budget - although I did build a contingency budget on top and the same with timing.
'From finding the building to opening the nursery took 22 months. I spent 100,000 on the conversion and have since been advised by a reputable estate agent that the overall value has trebled in price. It is a dream come true - I wanted to provide a luxury nursery where children could be happy and secure and I've achieved that.'
CASE STUDY
BUILDING A NURSERY.
Jeanette O'Dwyer, manager of Chard Pre-school in Somerset, is overseeing the assembly of their new timber building: 'We desperately needed a new building as the pre-school had been based in a pre-fabricated building since 1971. It was built in 1941 and only guaranteed for ten years so the upkeep was expensive - we had it re-roofed and had replaced all the windows but the building also had concrete cancer which we couldn't repair. We priced up a bricks and mortar building at 800,000 but that was not feasible as we couldn't fundraise the amount.
'Eighteen months later we became eligible to apply for Neighbourhood Nurseries Initiative funding. Our bid was successful. The building had deteriorated further so we needed something reasonably priced that was quicker to build than the estimated two years for bricks and mortar.
'Inspiration from a TV programme provided the answer - American timber-framed buildings. We e-mailed Jim Cram at Deck House in Acton, Massachusetts and he flew over for a meeting, joined by Simon Blackburn from Blackburn Barton in London who would design, import and construct the building. They priced it at 705,000, including shipping the materials, stamp duty and accommodation for Americans who would assemble the building. Not only did it work out cheaper but the building will be assembled in just 16 weeks.
'We worked together to design the pre-school to our specifications - with lift access to the first floor, a baby unit with its own kitchen, three major playrooms, low-level sinks and a disabled toilet and shower. It was great to have assistance to draw up plans and gain planning permission. The old building has been pulled down and ten men are now busy assembling the new pre-school.
'There's lots of glass to create a bright and welcoming environment, mahogany-framed windows and trim with cedar ceilings. Care has been taken to construct the building so that it will be energy saving.
'We're in rented accommodation while the building is constructed but the children have visited the site to see the building's progression. We're all excited to move in during early May.'
CASE STUDY
Recruiting staff.
Steps and Strides Day Nursery in Bedworth, Warwickshire re-opened in January after being closed for a year. New owner Jennifer Jay explains her recruitment strategy:
'I got off to a bad start with recruiting staff but, thankfully, once word spread that the nursery was re-opening it became much easier.
'An Ofsted guide to recruitment was helpful in detailing how to hire staff -what qualifications to look for, samples of employment contracts, employment law and how to discipline staff. My daughter-in-law previously managed a nursery so I got her on board to assist with recruitment.
'I started by advertising at the Jobcentre and was sent an horrendous mix of people, many lacking in qualifications and with poor attitudes. But through marketing the nursery I received ten unsolicited enquiries about jobs before I'd had a chance to advertise in Nursery World and the local newspaper.
'The nursery's previous baby room manager knocked on my door enquiring about work and she was a perfect candidate for manager. Her qualifications and experience were ideal and during her interview she impressed us with intelligent, common sense answers to questions and different scenarios she might face - such as how to deal with problem staff or complaining parents.
I deliberately wanted to employ a manager first so that I could register a suitable person with Ofsted and involve her in building a cohesive staff team.
'We then employed five people with a mix of ages and experience who we felt would gel, have a caring attitude and communicate well with parents. To help with team building I'm planning monthly meetings and training because I feel it is important for staff to up-date skills.
'I have increased each staff member's previous salary by ten per cent and have made it known that I will regularly review salaries. By looking after the staff and paying well I know they will work hard and want to stay - a high staff turnover is expensive, time-consuming and unsettling for the children. I believe by choosing the right team we have created a happy nursery environment.'