Starting a crèche is challenging for a number of reasons, not least the wide range of regulations and laws you’ll have to comply with because of your close working relationship with children. Financially, running a crèche can also be tough, as profit margins are low and overheads high. However, it can be a very rewarding business.

Starting a crèche is challenging for a number of reasons, not least the wide range of regulations and laws you’ll have to comply with because of your close working relationship with children. Financially, running a crèche can also be tough, as profit margins are low and overheads high. However, it can be a very rewarding business.

Why start a crèche?

Families with two working parents are getting more common, creating a substantial potential market for childcare providers. The different types of crèche also allow you to specialise, so you may wish to run a traditional daycare crèche or one close to a popular location, such as shopping centre. This then allows you to look after peoples’ children when they go shopping.

As well as the large potential marketplace, running a crèche can also be incredibly rewarding, particularly for those who enjoy working with children.

What skills will I need?

Your patience will certainly be tested, dealing with a range of different children with totally different needs. You’ll also need to be a superb judge of character when it comes to hiring staff – hire the wrong person and your reputation can disappear for good. Time-management is essential, as you’ll have to juggle many different tasks (feeding, school pick-ups, etc) and also ensure you have time to conduct the standard business-related jobs, such as book-keeping.

Bear in mind that crèches and nurseries are not big profit-makers. In fact, many crèches struggle to turn a profit as overheads are high and there’s a lot of competition. If you want to grow the business, you’ll need to expand because fixed costs and a limited capacity mean you’ll soon reach the turnover ceiling for one premises, so business nous will also be helpful.

Qualifications

Parents are obviously protective of their offspring and qualifications can go a long way to allaying these natural concerns. As part of the Ofsted registration (see below), the care centre manager must have a relevant qualification, between one and two years’ experience in a supervisory role, and two years’ experience as a qualified nursery nurse.

There are a number of qualifications to choose from. The Children's Workforce Development Council (CWDC) provides a wide range of useful information on the types of qualifications available and the accompanying levels of proficiency.


Regulations and legal issues

If your crèche provides more than two hours of day care for children under eight each day, it must be registered with the Office for Standards in Education (Ofsted). This process involves checking if the facility provides child care that conforms with the 14 national standards for day care provision. These include:
  • The amount of space required per child
  • The ratio of children to staff
  • Minimum provision of toilets and washing facilities
  • Premises safety
  • Adequate parking
  • Promotion of childrens’ emotional, social and physical welfare
You should make sure you are also compliant with all regulations set out by the Health and Safety Executive (HSE) as food safety and hygiene will be assessed by Ofsted. If successful with Ofsted registration you will be inspected every three years. Ofsted will also tell the local fire authority of your success; they may wish to visit to carry out the necessary checks of your premises.

Aside from Ofsted, anyone working closely with children will require a CRB check, in many cases an enhanced CRB check. Some parents will want to see evidence of your check so make sure you keep this close at hand. All staff will need a CRB check as well.

Anyone working with children will need to become knowledgeable about the legal difficulties that can arise. Parents have different levels of comfort with regard to what you can do with their children e.g. some may not want you to hug them when crying. Unfortunately this can make life difficult for crèche owners so it’s important to manage expectations with parents.

Insurance

When you first start, make sure you have public liability insurance and professional indemnity insurance as standard. Once you start hiring employees you’ll need employers’ liability insurance. You may wish to approach a specialist crèche insurance provider which deals specifically with your industry. Always check the policy carefully so you’re aware of any situations that aren’t covered.


Start-up costs

Start-up costs can be substantial, but it will be hard to get a rough figure until you answer some key questions, such as how many children you’ll cater for, if you’ll convert an existing premises or start from scratch, and where you’ll buy toys from (you can buy second hand but all products must be clean and bear the Kitemark symbol).

Modular nurseries are an option if you don’t want to go the traditional construction route; these are re-locatable buildings with a variety of customisable options. Prices start at around £500 per square metre, or around £14,000 for a 15-child nursery.

On-going costs will include food, supplies (such as cleaning products), advertising, and the costs involved in keeping compliant with legislation.