Increasing capacity in the current market can make good commercial sense for established nurseries which want to build on the free entitlement for threeand four-year-olds and attract more two-year-olds under the funded offer.
Another spur to growth is the UK's well-documented baby boom, as Jacqui Johnson, manager of GP Surveyors, points out. She advises nurseries that when it comes to expansion there could be more options for increasing capacity than they may realise.
'We are encouraging nurseries to reassess their internal space and think of it as a blank canvas,' she says. 'Could they switch rooms to allow for more two-year-olds? Could they reposition walls or make an under-utilised entrance hall smaller? Could they make better use of loft space or build an additional floor?'
She outlines how acquiring an adjacent building could more than double available space. 'In fact, this can also be one of the least disruptive methods of increasing capacity.'
Ms Johnson adds that she finds many nursery owners unaware of the tax relief that may be available on premises refurbishments, developments or acquisitions. 'This can amount to tens of thousands of pounds and can sometimes be applied retrospectively if work has already been carried out,' she says.
'WRIGGLE ROOM'
Acquiring a nearby building, as GP Surveyors has suggested, was the answer for Sarah Steel, managing director of the ten-strong Old Station Nursery group. One of her settings at Newark College, Lincolnshire, was abruptly given notice to vacate the premises in July 2012 when the lease would end.
'This left us with the option of closing the nursery altogether, letting down the 25 families who used it and making our staff team of ten redundant,' says Ms Steel. 'The much better option was to look for a new building which was close enough to the old one so that the families would still use us.'
Extensive local research found her a vacant office building less than half a mile away (pictured), which only needed some alterations to convert. The biggest hurdle came at having to get planning consent for change of use. The planning officer in charge stalled over a decision and the highways office objected to the plans because of the car park with a narrow entrance.
'They seemed to think a nursery needs as big a car park as Tesco,' says Ms Steel. She hired a firm of planning consultants, which recommended getting a transport survey done, adding another £2,000 to the costs. The planning application had to go to committee - but with the hoped-for time for completing the lease in August, the committee was on holiday. Permission was not granted until September.
Ms Steel enlisted a local builder, who had done lots of work for the group before. 'He knew what we needed to achieve and worked incredibly hard to meet our tight timescales. We were lucky our builder was happy to work weekends and long days to help us get in. We installed a kitchen, children's toilets and secure fencing, as well as other minor alterations.'
The nursery moved in October. It managed to do it without closing, having gained permission to keep using the old building until the new one was ready, and staggered the children in over the half term.
As unforeseen circumstances tend to come up in the way of timing and costs, Ms Steel's advice to other nurseries expanding is: expect the unexpected. Or a more scientific way of looking at it is using Critical Path Analysis for project management. 'Decide what you want to achieve by a certain time and then work backwards. Have builders and everyone else who's involved booked in by a certain time,' she says. 'You need wriggle room, and a contingency fund.'
GO FOR QUALITY
A bigger leap was taken by Kate Peach, who opened her first nursery in January this year. Having been managing director of Early Years Childcare she had plenty of experience with architects, conversions and new builds.
To create her own Each Peach Childcare, Mrs Peach remodelled two large Victorian offices in Hove near Brighton with the aid of the 'creative, visionary eye' of her business partner/operations director Julie Smith. 'This enabled Julie to look at a set of design plans and, armed with Ofsted measurements per child, go around the building and create the size and layout of rooms we would like,' she says.
'The architect pointed out any walls we wanted down that couldn't be moved. It didn't take a lot of input from architects - they only changed a few things, and liaised with us on which building firm to use.'
Mrs Peach drew on her local trade connections and relationships with the Chamber of Commerce. This is the bottom line advice she would give other nursery owners embarking on expansion: 'Know your local community, network via your community.'
But she admits it was a struggle to raise funds at a time when banks are reluctant to lend. 'The first project will always be the most costly, and it's the one the banks will look at,' says Mrs Peach. However, she warns it's a mistake to choose architects and builders based on costs alone. 'Appoint a quality architect who understands you and your vision,' she emphasises. 'Then the architect should be able to guide you to a good building firm. They will advise you not to go for the cheapest.
'You will get given very detailed building plans. That's when variations in costs will come in. Look the plans over carefully and query things. Find somebody to support you in this, who understands your vision.'
Over the course of 18 weeks' work on the new nursery, Mrs Peach made visits to the site twice a week.
At this stage, she would urge other owners: 'Go around the whole building and see what's new since the last time you came. Find some people you know and trust, to go through the Schedule of Works with you. Identify what work the builders are doing so you're not charged for anything you didn't request.'
Again, she emphasises that the community of other childcare providers is a good source of recommendations for companies or products they have used. Builders and suppliers should be open to negotiation for finding cost effective ways to achieve what a nursery owner wants.
The building firm in this case gave 15 weeks' guarantee on its work, during which Mrs Peach ticked several items on a 'snagging' list of imperfections, such as door handles that were broken or a gate that could fall off. 'You really have to keep on top of it,' she stresses.
Even with a close level of monitoring, the project took 50 per cent longer than she had been quoted. 'This left the builders very behind, and then came Christmas and snow.'
Agreeing on the timetable for the work was one thing Mrs Peach says she wishes she'd handled differently. 'Builders always begin to run over the time, I'm told - in fact it ran over by six weeks, and they didn't leave my building until three days before I opened my nursery. When they quoted 12 weeks, I wish I'd queried that and made it longer. By that time I had a full marketing campaign in flow. So prepare for the inevitable delay. That is something that will have a direct impact on your income.
'It didn't prevent me opening, but the stress levels ran high. We were showing prospective customers around in January and it was still a building site. So, don't announce when you're opening - just say "early 2013", for instance.'
APPROACHING AN EXPANSION
- Think creatively about how you could extend or re-use features of your existing premises, and look for other buildings you could acquire nearby
- Network with the community and other local providers for their advice and experiences
- Ensure your architects and builders understand what you ultimately want
- Don't let cheapness be your priority
- Query charges and quality as the work progresses
- Have a contingency fund for unexpected costs
- Have a contingency plan for late running.
