Help With Starting A New Business!

[clipclop1]

Never even considered owning my own business before, I'm totally ignorant of the logistics of financing etc so I was hoping some of you might be able to shed some light on this for me?!

I want to run my own childcare nursery, I have years of experience, that side of things isn't a problem.

I have been looking at established business' that are up for sale (on the internet obviously, not in person) and think that this is possibly the best option for me (or at least the first one I'm going to give proper consideration to before possibly deciding its not for me)

Here are my stats... they're not good! Haha
I have no savings,
I don't have anyone to give me any financial help
My credit score is 'good',
I don't think I'll be able to apply for grants to fund this option as it'll require a serious amount of money as business' are going for around £250,000,

So with all that in mind, I think my best option is to get a bank loan to put towards a deposit for a commercial mortgage as most commercial mortgages I've looked at want at least 20% deposit... but I'm not 100% sure this is the correct way to go about things...

Can ANYONE shed some form of light as to what/where and how to go about things?!

Many thanks!

[Buenchico]

Well, while I know very little about such things, I think that you're trying to run before you can walk.

However I'll still offer you a couple of links which might be useful:
https://www.gov.uk/browse/business/setting-up

http://www.ofsted.gov.uk/sites/default/files/documents/registration-forms-and-guides/r/Requirements%20for%20the%20Childcare%20Register%20childcare%20providers%20on%20non-domestic%20or%20domestic%20premises.pdf

Chris

[clipclop1]

Thanks but I've read through those sites about 10 times each, especially Ofstead, as I mentioned above, experience in the profession is NOT what I am lacking!!

I don't agree, I don't think I am running before I walk, again as I said above I am purely LOOKING into things and also invite people who have experience of such matters to comment. Thank you.

[honeydip]

Where abouts do you live? We are looking for a joint venture involving children.

[chrissa1]

We all have to start somewhere Chris. Child Care is a growing concern and is not a "risk" industry. Buying a proven business is a sound business proposition.

[sherrardk]

I would look into why these owners are selling their businesses.

[clipclop1]

Hi Honeydip, Preferably in the North East or North Yorkshire area... why are you guys looking for a joint venture?

[Mosaic]

Just a thought - why not plan a phased expansion.
Phase 1 - the max no. of children you can have without altering your present premises
phase 2 - use profit from phase 1 to part-fund building rental, business purchase or similar expansion
phase 3 - the big one as described in your post
Don't forget to write in staff ongoing costs, training costs, insurance and contingency.

[chrissa1]

Retirement?

[DTCwordfan]

You need to line up your candidates and enter into a Non-Disclosure Agreement to get at their financials and business plans and then shape your own plan up (that ought to be grounded in reality).

This then tees up the potential financials, the key thing being your cashflows over the next three years and then start to factor in costs. I would also be looking at all sources to potential cost reduction - assistance with rates from councils etc, grants available in developing regions such as down here.

Get yourself a cracking good accountant and a lawyer would be my starting place as well.

[bednobs]

hi mosaic, i thnk clipclop does not have her own business now. When she says "i have years of experience" i don't think she means as the owner of a nursery

[sherrardk]

PS - don't think you are supposed to get a loan to provide a deposit as you are then not actually risking any of your own money (ie, if it all went wrong you wouldn't personally loose anything, the bank that provided the loan would).

[honeydip]

Well because of the start up costs that is all. If you like you could email me at [removed]
My wife is a primary school teacher at the moment but does not have nursery experience apart from our 2 kids and one on the way. We have a house in W. Yorks but want to move

[bednobs]

if it works the same way as house mortgages, you can't borrow for a deposit

[clipclop1]

Hi Mosaic,

Thanks for your answer. I'm currently not in a position of running my own at the moment but I like your thinking! Some of these places are being advertised with planning permission granted which I have lots of ideas for and that is the kind of strategy I would employ.

Reasons for selling are to enjoy retirement mainly.

[ubasses]

Even when things are good the bank will require you to put in money from your own resources. The deposit coming from another loan would be a big no no.

[magsmay]

Firstly people rarely (but sometimes) put profitable businesses up for sale -the profitable ones are often snapped up before ever being advertised. Secondly - why not start small as a registered childminder, get a few clients do a really good job for a couple of years then expand? Do a business course on line so when you are ready to expand you will have the knowledge base to do it properly.

[Mosaic]

Bednobs - i understand clipclop has no nusiness at present.
But an initial income could come from using own home as the business premisses, which may require minor modification to meet required standards.

[buildersmate]

Well for starters, with none of your own money as risk capital, the only way a bank is going to lend you money would be by securing the loan gainst your personal property (house). Is that something you'd be happy to do?

Most businesses starting up don't buy their own property - they lease it.

[bednobs]

ok got you, sorry mosaic. I have a feeling from previous posts that cc rents (but that may not be true) and i would guess you can't run a business from a rented house? Or maybe you can?

[clipclop1]

Thank You for all of these answers guys, very helpful!

Ah yeah, leasing is probably the way forward but I'll have to look into exactly how much it would be and the logistics of it as the monthly payments would probably be hefty!