FREQUENTLY ASKED QUESTIONS
Q: What are the advantages of buying an existing childcare centre?
A: By taking over an existing childcare centre, the business has a history that makes your decision making easier. A start-up will have higher risks of failure. An existing operator or buyer does not have to go through the hassle of finding a suitable premise, applying for a change of use, getting all the necessary fire safety approvals (a nightmare!), licensing approvals, finding trained and qualified staff, and marketing the childcare centre.
Q: Why do I need to find a middleman?
A: Childcare operators cannot let anyone know that they are selling their business, as this might cause their enrolment to drop or their staff to leave. EduGrow is a professional childcare brokerage firm that assists operators to sell off their centre in a fast and confidential manner. We have been established in this childcare industry for a long time, and have the necessary experience and expertise in order to find you a suitable buyer at a good price. We are also able to give you a fair valuation of your business after looking at the numbers.
Q: How do you maintain confidentiality in selling my place?
A: We have in place Non-Disclosure Agreements that all prospective buyers must sign on, before we even bring them anywhere near your childcare. Rest assured that your confidentiality is our utmost priority.
Q: Can you just let me know what are the childcares available for sale in the market now?
A: We respect all our client's request for confidentiality, and as such are unable to provide exact address and details of all childcares available for sale. We would however disclose them upon meeting up and signing of the NDA. If you would like to see what childcares are available, do look at our childcare for sale page.
Q: How much do I need to pay to takeover a childcare centre?
A: It depends on how big the childcare centre is, and how much profits is it generating. Generally, you can find childcare centres being transacted at anywhere between 2 and 5 years of nett profits. However if the centre is at breakeven or at a loss, then the valuation depends on how much potential profits the centre could be making, or how much it would cost to setup the entire centre.
Q: What kind of childcare should I take over?
A: There is no real right answer to this. Some people prefer to takeover a childcare that is running at full capacity, which ensures that they get the maximum bang for their buck. However, some people choose to takeover a childcare that is running at low enrolment, which means there is room for improvement in terms of enrolment and profitability. With the right marketing strategy and branding, such a centre might eventually be able to run at a high enrolment rate.
Q: Do you take a flat fee or a cut of the takeover fee?
A: (For seller) Upon the successful transaction of each takeover, we will take a % of the takeover fee as our professional service fee, or you can let us know your nett price you wish to walk away with and we can work towards that. What we can guarantee is that the service and value we provide will far outweigh the fee. We have done numerous transactions so far and can definitely find you a buyer with our strong network of buyers.
A: (For buyer) If your pricing can match the seller's asking price, we do not take any fees from our buyers (although we will be glad to receive). However, if you offer a low price that the seller accepts but do not cover our fee, we may have to collect a fee from your end.
Q: How much is my childcare centre worth?
A: In order to answer that question, we would need to meet up with you and ask a few key questions. We will do a detailed financial review of your current business, and come up with a market valuation based on our analysis. You will know how much your business is worth, and why. This will be the basis and justification for the asking price for both potential buyers and investors.
Q: How long will the entire takeover process take?
A: The entire process can take anywhere from 1 month up to 3 months, depending on the method of takeover. There are certain steps that we will guide you through in order to complete the transaction smoothly.
Q: Who are your buyers?
A: Our buyers can range from large private operators, first time operators, local and foreign investors, or even private equity firms & fund houses. Rest assured that we screen through all our buyers very carefully to ensure that they have the financial means and expertise to run your centre.