How to start your own day nursery

How to start your own day nursery

How to open a day nursery UKToday we’ll be walking you through everything you need to know about starting your own day nursery, including key information on regulations, premises, staffing and possible required qualifications.

Lockdown and COVID-19 posed unprecedented challenges to the nursery sector, as they did to all of education. It was only permitted to look after the children of key workers during the height of the pandemic, for example, and a large number of employees were furloughed.

As a result, a number of nurseries temporarily closed or partially closed due to the requirement that staff and children isolate themselves if they tested positive or were in close contact with someone who tested positive.

In the longer term, prospects for the sector look bright, although many providers have had trouble keeping up with inflation because government funding has not kept up with inflation in recent years.

You could build a business that will flourish for years, perhaps even decades, if you understand what you are doing and are committed to delivering high quality early years education.

How to open a day nursery UK

A day nursery can be a great business opportunity, providing a much-needed service for working parents. But opening a day nursery is not a decision to be taken lightly – it requires careful planning and a considerable investment. If you’re thinking of starting a day nursery in the UK, here are some things to consider.

– What is the demand for day care in your area? Make sure there is enough interest to justify starting a business.

– What are the costs involved? You will need to purchase or lease premises, and fit them out with appropriate furniture and equipment. You will also need to employ qualified staff.

– Are you prepared to deal with Ofsted? All nurseries in the UK must be registered with Ofsted and inspected regularly. This process can be complex and time-consuming, but it is essential to ensuring the quality of your service.

Opening a day nursery can be a rewarding experience, but it is important to do your research and make sure you are prepared for the challenges involved. With careful planning and dedication, you can create a successful and thriving business.

From deciding on a location to putting together a business plan, establishing a brand, and training your staff, this article will walk you through every step.

Is it the right time to start a day nursery?

Working and raising children have changed attitudes. Research by the Institute of Fiscal Studies shows that 78% of mothers between the ages of 25 and 34 are employed, compared with just 50% in the 1970s.

Many government programs, such as free preschool and childcare for two-year-olds, 15 or 30 free childcare hours for three- and four-year-olds, aid parents in continuing to work throughout the early years of parenthood.

Also shown in the research are statistics that 69% of mothers believe reliable childcare is the key to getting back to work, and 40% believe good childcare is the key – making now an excellent time for a day nursery. In addition to launching one that will cause ripples in the community.

Changing healthcare demands go beyond high quality care. There are still a lot of laws, licenses, and qualification requirements associated with starting a nursery, but finding a premises has become easier.

As a result of Covid-19 causing havoc on struggling high streets, the government began an overhaul of the building use category system, allowing retailers, restaurants, and even office buildings to be converted into childcare centres without requesting changes in use.

So, are you capable of starting a nursery?

Having the right qualifications and experience

If you intend to manage it as your own business rather than take on teaching and day-to-day management duties, you do not need any qualifications or experience to start a nursery.

If you’re going to remain behind the scenes, it’s a good idea to learn all you can about the operation of a business. If you plan to teach the children directly, you’ll need some training and experience.

An experienced nursery manager, for example, should have worked as a nursery nurse for more than two years, held a supervisory role for at least one to two years, and possess a nursery qualification. Check out this early years career progression pathway from City and Guilds to discover how you can start and manage a childcare facility.

Different types of day nursery

A day nursery can be one of three types.

Private – owned and operated by a private enterprise

Not-for-profit – a day nursery usually associated with a community centre or religious institution

State-funded – associated with a school

In this article, we’ll discuss how to start a non-profit nursery and a private daycare facility.

How do private and independently owned nurseries differ from not-for-profit nurseries?

The same rules and regulations apply to nursery owners regardless of whether they are starting a business or giving back to the community.

The only difference is that a not-for-profit day nursery is run by an organization that absorbs all profits back into their community or religious community.

Just like any regular business, private day nurseries are run on a profit-based basis, with shareholders receiving dividends.

Going out on your own or franchising

A franchise may be right for you, or you can go out on your own. Both have advantages and disadvantages. Let’s look at them briefly:

Own business:

Build your own brand

Source your own funds

Keep all your profits, unless you’re a not-for-profit

Set your own targets and goals


Come off the back of an existing brand

Franchise group contributes to funding

Franchise group takes a percentage

Meet targets set by the franchise group

Starting a day nursery costs

If you choose to create a community run not-for-profit nursery, you know if it’ll be a private day-care. What’s the cost of setting up the nursery?

As far as price goes, it’s difficult to give you an exact figure because it’s dependent on so many factors, such as the number of children you’re planning on serving, the size of your premises, and the equipment you’ll need.

The cost of setting up a nursery may seem high; however you might be able to start one for much less. Consider, for instance, whether it’s necessary to outsource marketing, or whether brand-new equipment should be installed.

There are a number of commercial finance companies that offer business loans to children day care nursery to support growth and acquisition.

The listings on indicate that you can actually buy an operational day nursery with 54 places for around £50,000.

It is important to consider on-going costs as well as the setup costs. Among them are:

  • Premises rental cost – varies by square footage and area
  • Staffing costs – nurseries tend to pay around £21,000 in salaries
  • Utilities cost – research local council tax rates, water, and gas and electric rates
  • Insurance – be sure you have adequate coverage
  • Cleaning – costs for hiring cleaners to keep the nursery and food preparation area clean

Registrant costs should be considered as well. There may be differences based on which UK country the facilities are located in. A day nursery needs to pay OFSTED £220 to register on its Early Years Register in England.

Day nursery licenses and regulations

If you are going to be based in England, Wales, Scotland, or Northern Ireland, you will need different licenses, regulations, and legal protection than if you are going to be based in another country.

However, there are a few core regulations that do not change. These include:

Registering your day nursery 

You will need to register your day nursery with your country’s specific regulatory authority regardless of where you begin your day nursery in the UK. It is also important to check that your nursery complies with the Early Years Foundation Stage (EYFS) framework prior to applying to the authority.

If you want to register in your country, you should look at its registration process as early as possible, as there are usually some pre-registration boxes to fill out, such as DBS checks and health checks.

You can find the UK regulators here:

In England – this is Ofsted (Office for Standards in Education). Head over to the Ofsted nursery registration page for further details.

In Wales – this is CSSIW (Care and Social Services Inspectorate Wales). Take a look at the page on starting a nursery in Wales for further details.

In Scotland – this is the Care Inspectorate. Head over to the Care Inspectorate nursery registration page for further details.

In Northern Ireland – this is the Health and Social Services Board (HSSB). Head over to the page on day care registration in Northern Ireland for further details.

Taking out the relevant day nursery insurance cover

is also required, along with public liability insurance.

Here is the full list:

  • Public liability insurance– covers the cost of any injuries or illnesses that may occur to the public while on your premises
  • Employer’s liability insurance– to cover staff injuries and illnesses that occur on the premises
  • Professional indemnity insurance– protects you against giving the wrong advice to children or parents
  • Commercial property insurance – to protect your property against flooding, fire, and theft

If a nursery trip is planned, you should make sure that your insurance policies cover children and staff away from the nursery.

You may also want to look into business interruption insurance, which will provide coverage if you have to close your business for a while.

Food safety and hygiene

It is imperative to adhere to food safety and hygiene standards.

When you’re in charge of preparing and handling food at your day nursery, you’ll need to be qualified, according to the Food Standards Agency (FSA).

With its Safer food, better businesses pack for childminders, the FSA goes an extra mile to help you comply with the specific requirements. There you will learn all about the food hygiene requirements for storing, cooking, and chilling in a daycare environment.

Health and safety requirements

Additionally, you will need to adhere to strict health and safety requirements. Furthermore, you’ll need a health and safety policy that defines how you’ll handle things like:

  • Risk assessments
  • Fire safety and risk
  • Reporting injuries
  • Evacuation procedures
  • Maintenance
  • Storing and handling hazardous substances

Staffing regulations

When it comes to staffing, you need to follow some pretty strict rules. Staff with specific qualifications must be present as well as a certain number of staff per child. Here’s what we know:

0-2 years : One member of staff for every three children
2-3 years:  One member of staff for every four children
3-7 years:  One member of staff for every eight children

Important information

A minimum of half your staff should be qualified to work at a level two nursery. There is a handy tool to find out if a prospective employee has the right qualifications for the position.

You can find a lot more information about this complex but crucial subject matter in the Twinkl guide to EYFS ratios.

Finding a day nursery premises

Having a rough idea of how many places you plan to offer is helpful.

Next, decide where your day nursery will be located.

The rules regarding that are strict, as well. The following are the required square metres for each child according to their age.

0-2 years : 3.5 square metres per child
2-3 years : 2.5 square metres per child
3-7 years : 2.3 square metres per child

In addition to making it easier for prospective day nursery operators to convert existing buildings, the government has also provided a checklist for finding the right property.

Consider these factors when choosing a day nursery building:

  • Does it fit your target market (are there many family homes or schools nearby)?
  • Would another nursery be in demand? Are existing nurseries in the area full?
  • Is the nursery going to be attached to a community centre or religious community and will it be nearby?
  • Does the nursery offer parking?
  • What are the transport links like?
  • Does it offer reasonable outside space for a playground?
  • Is it in a safe neighbourhood?
  • Is there the potential to install all the necessary facilities, including toilets and changing rooms

Upon finding a building that fits the bill, consult an early year’s architect about the cost of converting it. Once you have this information, you’ll know how much you’ll need to borrow.

Coming up with a business plan

Now you know how much you have to think about before you can even begin thinking about starting your own daycare. Creating an in-depth business plan is the next step if you meet the requirement, or you’re ready to do what it takes to meet the requirement.

You will stay on track, stay within budget, and secure funding if you create a business plan.

Business plans need to be carefully crafted – a few notes on a piece of paper won’t do. To help instil confidence in your prospective lender, you may want to bring an entire folder of information to the meeting.

Building your day nursery brand

Logos and colour schemes are only one aspect of branding. Branding is about how a company wants to be perceived by its target market. Branding must encompass everything that you do, from how you communicate with parents to the way you teach.

It is difficult to build a brand from scratch. The best way to bring your vision to life is to meet with a branding consultant. Then, you can use your brand across communications, websites, buildings, uniforms, and policies.

Social media and websites are great for building brand awareness after you have established your brand. Images of children who attend your daycare facility online, however, are subject to rules and regulations.

These include:

  • You must get permission from the parent to take a picture of the child
  • You can’t name the child on your social media or website
  • You must communicate a clear policy with the parents – e.g. no tagging on Facebook

Marketers believe social media is essential to building communities. It’ll undoubtedly improve the demand for your day nursery if you can get people talking positively about it.

Creating a day nursery website

There are a number of website builders that offer attractive local business templates for as little as £15 per month, making the cost of developing a day nursery website almost as cheap or expensive as you like. Quality content and high-resolution images of your nursery are all you need.

Alternately, you can hire a web designer to create your daycare website for you. If you don’t have much spare time or don’t feel comfortable enough to create your own website, hiring a website designer is a good option.

Copywriting agencies work with website designers, so you won’t need to create your own content. You’ll also have your content optimised for search engines, which means you’ll rank higher on search engines.

Starting a day nursery: the checklist

This concludes our discussion. There is no doubting that buying an existing business or approaching a franchise group are two quick ways to get started with a day nursery.

In summary, here’s what you need to do when starting a day nursery:

  1. Make a decision whether you want to run a day nursery as a business or if you want to be involved in the day-to-day management. You must have nursery management experience and qualifications if you want to be involved in day-to-day management.
  2. Choose the type of day nursery you want to open. Do you want to start one to fund a local community centre or religious organisation? Are you interested in being an independent brand, or do you prefer to be a franchisee?
  3. If it’s financially feasible, you’ll also know what kind of loan to apply for, so consider all the costs involved. Moreover, you’ll need money in the bank for salaries in addition to setting up costs and building up your brand.
  4. Check out the regulations and rules. You’ll know what kind of building you’ll need and how much work you’ll have to do. Estimate the number of staff members you should have for each available spot.
  5. Plan your business plan so that it includes everything you’ve had to consider up to this point, such as why you need a nursery, your qualifications, how many spots you want to offer, costs of staff, and how you’ll make money.
  6. Consider looking at suitable buildings within the area of your choice once you have secured financial investment. The building should have the required square footage, as well as the ability to install essentials such as a kitchen, toilet, and changing area.
  7. Start creating a brand for your day nursery and start talking about it. Start a website, build a social media campaign, and spread the reasons why parents should entrust their children to you.