Get Your Childcare Centre Sale-Ready and Ensure a Good Price For It
Ask any operator and they will tell you that owning a child care centre is hard work. So when you make that final decision to sell, you want to ensure that you get top dollar for all that invested time!Industry expert, Broker and Centre owner himself, Phillip Malek, has helped hundreds of owners/operators achieve their business goals and this month has come up with 3 simple steps to get your child care centre sale-ready for the new financial year!
Step 1 – Establish Your Unique Selling Point
What does your service do that sets it apart from the others?
Identify an element that you feel contributes to the intrinsic value of your service. In the industry, we call this your ‘competitive edge’, otherwise known as your unique selling point.
It’s not just a matter of ‘assessment and rating’; there are other elements at play.
Does your service: provide meals? Have animals? Cater for children with additional needs? Offer a safe but challenging playground? Provide adequate parking? Do you engage with the local community for excursions and events? Is your service recognised for excellence in awards programs such as Australian Child Care Week?
There’s a reason why a special feature is referred to as a ‘selling point’; make the most of it when putting your service up for sale.
This is something which we specialise in here at Childcare Concepts, so if in doubt, simply ask us and we can set you on the right path!
Step 2 – Get The Right Legal Advice
Make sure the person handling your investment has well-established experience in the early childhood education sector.
Ensure you as the client are not using a first-time solicitor as purchasing a centre is completely different to the purchasing of a house. This is a trap that we see clients fall into time and time again.
For example, an application for a grant of approval of a transfer of license generally takes a minimum of six weeks to come through. Don’t find out the hard way that, having settled, you can’t start operating the service you’ve just purchased because approval of transfer hasn’t been granted as yet! Completion of a sale should always be conditional upon the purchaser obtaining a licence.
There will almost certainly be adjustments to take into account as part of the transaction: bonds to be held in trust; rent; fees; credit; staff entitlements… Choose someone who has the experience to know that all of these items must be considered.
Having the right solicitor with the right experience will ensure a smooth and timely settlement period.
Don’t have a solicitor? That’s ok. We have wonderful relationships with a selection of very experienced and capable solicitors who specialise in this sector.
Step 3 – Mums The Word
Keep the sale on the down low!
The fact that your service is for sale, and has been sold, should also be kept in the strictest of confidence right up until the week immediately prior to the completion of the sale.
This will ensure that your staff and parents are not left feeling anxious, unsure and most importantly don’t jump ship!
As a seller, you have the right to your private information to be treated in confidence by parties looking to acquire this service. Therefore all potential buyers should be required to sign a Confidentiality Agreement before receiving any information about the business or information that may reveal the identity of the service being offered for sale.
ALSO… Always remember: Take care of the staff and they will take care of you!
In addition to taking account of staff entitlements, don’t overlook the staff itself. In most – indeed, virtually all – scenarios, staff retention is in the best interest of both the buyer and seller. It will ensure a smooth transition of ownership and it is critical to goodwill. Staff familiarity provides stability for the children entrusted to your service and this maintains the families’ confidence in the service during the transition period. Take care of the staff, and they’ll take care of the business.
Want to take the next step and find out more? Contact us directly – we are only too happy to chat!