A quick guide on the types of daycare in the UK

/ Posted By - Bradleys Accountants / Categories - Advice for Small Businesses

In the UK, all children must compulsorily attend school from age five. Preschool is not compulsory, but most working parents enrol their children in a preschool, nursery or daycare setting anyway when they are at work.

Most of these are privately run, with the UK government spending on pre-primary education from 3 years to the start of primary school at just 0.4% of GDP. Childcare is indeed exciting. However, it is equally demanding and challenging to do business in. If you are thinking of starting your daycare, kudos to you!

But even with undeterred focus and dedication, you require a sustainable business model to grow your daycare in the long run. Therefore, it is a good idea to research your options and see what best suits you. Adding to that, let us dive deeper into each of the three daycare options and see what they entail:

1. Day nurseries

These provide childcare for children up to the age of five, although the exact age range may differ from centre to centre – for instance, some places do not accept babies under one.

Local authorities may fund day nurseries like those operating from churches, community centres, or privately owned ones. Besides, most day nurseries have limited seats, so it might be worth checking what is the maximum capacity you can accommodate.

The timings are important to note too. Day nurseries typically start as early as 7 AM and wind up by 6 PM to coincide with the typical work day. Children at day nurseries experience a mix of playtime and developmental learning activities and also get meals and snacks, which are included in the cost of the day nursery fees. Among the activities day nurseries are likely to organise include:

  • Storytelling
  • Outdoor playtime
  • Playing with toys
  • Art and craft sessions
  • Listening and dancing along to music
  • Sensory play involving sand, water or other such elements
  • Elementary number and language skills, such as learning the alphabet

Day nurseries can have as few as 20 children and as many as 200 children. Many tend to serve only a local population, especially the ones funded by a local church or organisation.

In general, staff members are hired to ensure adequate attention to and supervision of each child. For instance, for children under two, there will be one staff member for every three children. That means you must consider the hiring expenses accordingly.

Day nurseries in the UK are required to be registered officially. And most offer introductory periods where the child attends for a week or two, and parents can monitor their progress. This also allows the day nursery to see whether the child will be a good fit.

2. Preschools

In many ways, preschools are similar to day nurseries. However, they are more academically oriented in that children learn more maths, language and cognitive skills during their day.

For that reason, preschools help children transition to regular school later on, which is why many parents opt to transfer their two or three-year-old children from day nurseries to preschools.

For this daycare option as well, there are some pretty strict regulations when it comes to staffing. Not only you must hire qualified staff to look after the children but also there should be one staff member for every four preschoolers.

3. Crèches and playgroups

These are more informal daycare options and tend to run only for 2-4 hours a day. Fees vary depending on whether they are run by a local organisation (such as the church) or privately. Some crèches are owned independently and allow parents to leave their children for a set number of hours while they run errands or complete other tasks. Some crèches will also enable parents to participate in play sessions, providing bonding opportunities.

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    Starting a daycare: Get your accounts and licences in order

    Once you have completed your market research and chosen one of the three daycare options, here are 4 factors you must take into account:

    1. Are you qualified for the job?

    If you only want to run your daycare business and leave the teaching to experts, you do not need any qualifications. However, if that is not the case, the rules may differ. For instance, a daycare manager must have a nursery-related qualification, about 1-2 years of supervisory experience and at least two years of nursery experience. So check on the qualification requirements before you make a decision.

    2. How are you managing expenses?

    The cost of setting up a daycare depends on the location and size of your premises, in addition to the operational decisions you make. For example, you can keep expenditure lower by purchasing high-quality secondhand equipment instead of brand-new equipment.

    When hiring staff, we recommend getting the best professionals on board – even if that is expensive – because young children are involved. Assess all potential expenditure and identify those where you can manage with lower than planned; for example,, you can save costs by initially branding and marketing your centre on your own.

    3. Do you have licences and regulations in place?

    While individual regulations vary in England, Scotland, Northern Ireland, and Wales, you must meet the Early Years Foundation Stage (EYFS) standards and register your daycare with your country’s regulator. In addition, get DBS and health checks done for all employees.

    You must have daycare nursery insurance, including employer’s liability insurance, commercial property insurance, public liability insurance, and professional indemnity insurance.

    There are also food regulations to abide by – for instance, the Food Standards Agency (FSA) has defined hygiene regulations for cooking and storing foods designed specifically for childcare providers. Lastly, have an apparent health and safety policy in place, including evacuation plans, risk assessments, injury reporting, and so on.

    4. Do you have a simple fee structure?

    Different fee structures and policies for multiple reasons are not advisable. Instead, offer a percentage discount, calculate straightforwardly and communicate clearly. Save time and effort by having just one price for your service.

    Get help from Bradleys Accountants

    You are not getting into the daycare business because you love numbers. You want to provide the best possible education and care for the children, which is why it is essential to hire an accountant you can count on when it comes to managing books or doing payroll.

    You must set up adequate accounting procedures for daycare. Lucky for you, we specialise in accounting for daycare nurseries and can help you stay on top of bookkeeping and tax deadlines. Get in touch!

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