opening a nursery FINANCES

opening a nursery FINANCES

by: vicki118 - 20-07-08 18:43

Hi

just a quick question. I would really appreciate it if anyone who has started there own nurser could give me a very rough ball park figure of the total costs it cost you to start up your own nursery business (for renting a property rather than buying). I know this is quite a rude/personal question but you really would be helping me out if you could answer, thankyou in advance to anyone who does.

It's just that i am looking into opening a nursery but tbh am very doubtful if i could afford it as i am still quite young (24) and would have to borrow, i have done a business plan, but i don't see the point in throwing myself into anymore research until i know if it would at leasr be a feasible idea

thanks :)

by: newsetting

How long is a piece of string? Rents will vary wildly from place to place and depend on location, size of building, who you are renting it off etc etc the list is endless. If you are looking at renting rather than buying, you will have to have about six months rent in advance (and commercial rents arent cheap!) to cover deposit and bond money, plus money to convert the building to a nursery(this can be as cheap as you like, but if you are setting up new can go skyhigh!), plus legal costs to cover the arranging of the lease (ballpark-mine last nursery cost me £3000 in legal fees to arrange the lease)

My first nursery ,I spent 200k on building and groundwork, 60k on equipment and 5k on legal fees (very very rough figures.

Last nursery was leasehold-I spent 85k on equipment, fixtures, fittings and refurb plus 3k on legal fees, plus 10k on landscaping the outside area. (again very very rough figures!)

 Its not cheap!

by: newsetting

PS-age isnt a factor-I was 24 when I opened my first nursery. Three years on, Im on course for nurseries three and four within the next 12 months! Age is nothing-determination is EVERYTHING!

by: vicki118

thanks so much for replying!

 did you borrow or was it your own money? i don't own my own house ( i rent)and i have no idea how much any provider would be prepared to loan me? but i doubt it would be anything like that amount, do you think i have any chance of raising the finances?

by: vicki118

oh, and your nurseries must be fab for them to be doing so well!

by: newsetting

Long story with the finance! Basically I went to all the high street banks and got turned down pretty much straight away. I had no previous childcare experience BUT i was a qualified accountant and worked as a Financial Analyst for a global company! They didnt really think this was good enough to run my own business!

So, in the end I remortgaged my flat and my parents (bless them) remortgaged their house so I could raise the money.

Also nowdays, the credit crunch means that its even harder to raise cash especially from high st banks and finance companies. It may be worth looking at other forms of finance such as Business Angels, grants (Princes Trust) or going into partnership with someone who does have funds (or access to them)

Wish I could be more positive, but it is so hard to get finance now, even if you do the best business plan in the world. Banks just arent willing to take risk

by: newsetting

Sorry to PS again! But the good thing about taking personal loans out rather than business loans was that it meant that on paper, the business has no debt. This made it REALLY easy to get a loan to start nurseries three and four, as banks love that!

by: kaz

We are in a rented hall (Scouts) and we pay them a donation of £5 an hour, this includes all utilities such as electric, phone (we don't run the bill up!) and water. Our hall is well maintained and cleaned by them. WE have just paid for the car park to be fenced but did not ask the scouts for any money to sweeten them!

This is more expensive than our last hall that was £8 a session but change in hall committee put the rent up by 500% to £40 a session so we left!