How To Open a Nursery On a Budget

So to start off with,

Tip No. 1 is to – Negotiate a rent-free/mortgage-free period with your landlord or mortgage provider.

This is underused by most people as it can be daunting to ask for something for free.

However, from experience, a lot of landlords and mortgage providers are open to the suggestion, and there is no harm in asking.

A rent-free period or rent abatement is the suspension of rent that you, as the tenant, would otherwise pay at the start of the lease. Here, the landlord does not require you to pay rent for the premises until your business is up and running.

When negotiating the lease/ mortgage for the building you can ask the landlord or mortgage provider for a rent/mortgage-free period at the beginning of the contract to help you to undertake necessary building works.  Before you start getting an income.

This becomes easier to negotiate if you are planning on a long lease.

The abatement period is usually between one and three months, though can be anywhere up to 6 months.

This gives a potential savings of around £15,000

Step no. 2 is to Buy resources second-hand

When buying equipment for your nursery, you don’t need to open up your nearest nursery catalogue and spend tens of thousands.

As mentioned in my last video ‘the essential equipment and resources you need for a nursery’ a lot of resources can be brought cheaply from local schools or nurseries.  It’s advisable to check some out.

I managed to get a lot of good quality robust chairs, tables, and outdoor equipment from my local school who was just doing a remodelling.  All for free.

You can also find some good resources from sellers on eBay, Amazon or Facebook selling groups.

Top tip – find out if any nurseries have recently closed down and buy some of their resources in bulk.

Potential Savings: £5,000

No. 3 – Register with Ofsted as soon as you have your building

Usually, it is advised to wait until all your building work is done and you have secured all your equipment before registering with Ofsted.  This is because when Ofsted visits you, your building and nursery have to be completely ready – as if you were to open the next day.

Though, Ofsted can take up to six months to register a nursery once the application is complete.  This could lead to a situation where you have to wait a whole six months, paying rent, gas and electricity on a building just waiting for Ofsted.

Therefore, I advise registering with Ofsted as soon as you get your building.

This gives you the chance to do all the building works etc whilst your application is being reviewed.  If Ofsted does wish to visit early and the works are not ready, you can delay them by up to 16 weeks.

Also, if there is anything that needs changing in your application it gives you a chance to do this without causing an extra delay.

Potential Savings: £15, 000

No. 4 – Pay nothing for your recruitment, human resources, accounting and marketing

A lot of nursery owners spend thousands per quarter managing their recruitment, human resources, accounting and marketing.

This is because many lack the confidence to do it themselves.  You may also be in this position; I was too when I first opened my nursery.

However, once I learned how to do it myself, I realised how simple it was.  If you take the time (which isn’t that long) to learn these systems you can save so much money, not just on opening, but for as long as you run your business.

I teach all of this in the full course ‘Open Your Own Nursery In Just 6 Months Without A Massive Budget‘.  It covers how to hire staff, how to pay HMRC, pay pensions, register your business & pay tax and how to create your website.  Plus, lots more.

So, if you want to learn all of that I suggest enrolling on the course.

Potential Savings: £10, 000 per year

No. 5 – stagger your recruitment

This one is more obvious, but can be overlooked due to the task of planning your opening.

So I must remind you – don’t hire all your staff straight away.

When you first open you are unlikely to have sold out all your nursery places (you aren’t expected to be full until at least 9 months after opening).  This means you do not need to hire all the staff needed as if you were full.

You can stagger your recruitment as you grow.

Hire just a few staff at the beginning and as you get more children in hire some more to cover the increased demand.  Planning your recruitment correctly in stages can save you loads in the long run.

It also gives you extra time to mould the staff into your ethos as there will be less to manage.

Potential Savings: £5,000

Before we get onto my bonus tip, I wanted to let you know that you can continue your learning after the video by enrolling on the course ‘How to open a nursery – the starter guide’. For just £4.49 using discount code youtube2 you can:

1. Learn how to save over 70% opening a nursery
2. Create a survival budget
3. Work out how much it will cost to set-up
4. Create your business plan
5. Learn more about the seven steps to open