To buy or build an ECE Centre - What's right for you?

Posted on 05/09/2018

If you’ve decided that the early childhood sector is something you’d like to get into, and that running an ECE centre is the type of service that best suits you, the next decision is whether to build one from scratch or see what’s already out there for sale. To help you choose, here’s what you need to consider about both.

If you’ve decided that the early childhood sector is something you’d like to get into, and that running an ECE centre is the type of service that best suits you, the next decision is whether to build one from scratch or see what’s already out there for sale. To help you choose, here’s what you need to consider about both.


The benefits of buying an already existing ECE centre 

Ease and speed

Overall, it’s a much simpler process to get into your ECE business. In comparison, aside from the construction phase, building new can take quite a bit of time and energy, not to mention money. When building from scratch, not only do you have to find the right site you also need to obtain permission to build and run an early childhood education centre on it. There’s building consent and resource consent to apply for through your council as well as submitting an application to the Ministry of Education for a licence to operate. All these things have different requirements to meet, most of which are on the complex side with many variables to be considered simultaneously; eg. site location and size, legal space per child requirements, parking spaces, storage, sleeping and play areas for different age groups, food preparation areas, cleaning and changing facilities, and accessibility. On top of these more tangible factors, don’t forget about things like noise, traffic and civil engineering! With an existing centre, there’s none of that – it will be easier and faster to get started.

Lower set up costs and less risk

After reading the above, it almost goes without saying that in most instances, overall set up costs are relatively low when buying an existing ECE centre. If you build and the applications for consent don’t go smoothly, the costs can escalate based on the time it takes to obtain them. Take resource consent for example; if your local council feels your plan might cause disruption or not fit into the surrounding area they may choose to notify the public who can then make submissions on it. You have to pay for any public hearings. Even if your application is accepted on a non-notified basis (this means the public do not get to make submissions) it doesn’t mean approval is a given; the council may still require further expert input to determine an outcome; a cost worn by you.

Certainty

There are no guarantees in life but one of the key benefits of acquiring an existing centre is that it provides you with some certainty over the financials. With an existing roll of children and historical records to guide you, costs and income are known. This makes budgeting straightforward and less stressful. Providing even more certainty, an existing centre comes with staff who already know the business. And because the premises exists you can see it, inspect it and get a feel for what it would be like to run. 

Sounds like the way to go, right? Hold on, here are a few more thoughts:

 

Things to consider about buying an already existing ECE Centre

Doubt

Why is the centre for sale in the first place? Is the business failing? If so, is it due to the current management or other factors that may be outside of your control?

Baggage

Just because an existing centre comes with staff doesn’t guarantee they’ll be right for you and your business model. Sometimes there are pre-existing tensions between staff and parents or staff and management that have seen it not work out. Buying an existing centre means you inherit these issues.

It’s also possible your staff may be resistant to change when it comes time to apply your own philosophy to the centre.

Building upgrades

An existing ECE centre will have undergone some wear and tear so there may be building maintenance issues (or deferred-maintenance issues) to address.

Limited growth

The centre may also be operating under limitations that don’t meet your requirements. When you build new you can future proof your business by factoring growth potential into your design. However, it is possible to get as existing centre assessed by an expert to determine whether there are any opportunities to increase the license size and allow additional service hours.

 

So what makes building new the better option? 

Better learning and working environments

There are plenty of excellent existing ECE centres out there. But there’s no denying that with each new piece of research on learning, or advancement in knowledge and building materials, comes the opportunity to provide the absolute best quality environment for children and staff. Spaces are warm in winter, cool in summer and provide good amounts of natural light. Modern eco-friendly materials and energy efficient designs can be specified. The site layout, and the configuration and orientation of the building can be designed to achieve optimal child numbers, maximum play space, achieve an efficient parking layout, control and contain noise, and get the best solar and ventilation control.

Plus – it’s YOUR vision for what you want YOUR early childhood education centre to be.

Purpose designed to meet regulations

Despite what you read earlier, applying for resource consent doesn’t actually have to be that difficult (unless you attempt to DIY). With the right advice, being able to design a centre from the ground up can actually make the process simpler and as cost effective as possible by accommodating council planning controls, Building Code requirements and licensing criteria from the outset.

Purpose designed to maximise your site

With a new build, your early childhood education centre can be specifically designed for your chosen site’s individual characteristics – both its constraints and opportunities. With an existing centre, it is what it is and trying to alter or add on to it comes with even more resource and building consent complexities than a new build!

The ability to future-proof

While nobody knows what’s coming, building new comes with the option of including buffers (eg. space allowances) that will give you wiggle room in the future should change happen or you want to grow the centre.

 

So, what's right for you?

Ultimately, it boils down to whether you want to get in and get started right away or you have a specific vision you’re committed to. Our Need-to-Know Guide to Starting Your Own Early Childhood Centre (ECE) provides you with all of the essential information you need to set you up for a great journey.

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