Hi,Childcare centre business command large $$$...and there are...

Hi,

Childcare centre business command large $$$...and there are still heaps of people out who want to jump on the bandwagon of owning a childcare centre..

Someone recently expressed interest in buying my parents home to converting downstairs into childcare centre...car park requirements could not be met for my council.

My home (in same council) I commenced plans to get approval to build a centre but gave up given the council requirements...My council is difficult.

These business typically seek over 500,000 when it is licenced to 55 or more kids, with the large 70/80+ kids asking up to 1mil+...(business only).

In recent years DOCS and Councils have tightened the requirements for new centres, and so that means existing centres have advantages and better value...i.e Number of kids per sqm, parking etc...these days a new centre is an expensive project...but existing centres are great buys.

They won't have to firesale these, they may not get top $$ due to the number of them out there, but all the individual operators with 3,4,5,6 centres, would be keen on the opportunity to take it 2,3,4,5 more.

ABC in their expansion pursued mostly centres of 55+ kids, which works in their favour, as <55 centres are less attractive as a business...

An 80 kid centres, $60 a kid, $4800 a day. = $24000 a week.
15 staff, at avg $1000/wk = 15k, 5k to cover everying else and 4k left in the profit pocket. (you will find I was generous on the staff wage estimate)
The 15 staff would be aroung current day requirements, but those centres from early days have better licence conditions.

see for example the prices on http://www.childcare4sale.com.au/

Now ABC has in Australia about ??? 1000 centres? ,
If firesale took them at 400,000 each, thats $400mil.

There is still UK, and there is still US 40% holding.

Is it really the end?