Nursery owners come together at Nursery World's Business Dinner in partnership with Redwoods Dowling Kerr

Held at the Ivy Club in London, the evening began with a welcome from NW editor Karen Faux and was followed by a presentation from RDK managing director, Andrew Steen.

Steen (pictured below) highlighted the trends underpinning a changing private day nursery market. According to RDK’s data, large nurseries of 60-plus places are continuing to steadily increase their market share, with this standing at 36.3 per cent in 2023. While medium sized nurseries of 40 to 59 places have remained static at around 28.5 per cent of the market, those with 20 to 39 places have reduced market share to 33.8 in the last three years.

Steen reported that growth in mid-sized groups is curtailed by corporate acquisitions. ‘There is a clear strategy for many operators to build scale and sell,’ he said. ‘There is a very clear route to exit.’

He added that on average, the market share of corporate operators is nearly doubling every three years.

Despite the growth in large groups, they are still a long way from dominating the market overall, which remains frangmented.

RDK’s data shows that groups with 15 sites or more accounted for nearly 19 per cent of the market, while those with five to 14 accounted for nearly 14 per cent.  

Clearly it is becoming more challenging for single site settings to be sustainable with the data showing a drop from 60 per cent in 2018 to 2023’s 38 per cent.

Interestingly more than 24 per cent of childcare owners are aged 60 years or over and more than 29 per cent are aged 50 to 59.

Conversation around the table started with an exchange of experiences around mergers and acquisitions. Dominic Harrison of ICP Edu Care, who has worked with RDK, talked about how the company supported him though a recent acquisition while others around the table touched on the importance of keeping all staff in the loop to maintain trust.

Later discussions focused on recruitment with James Howlett of Nunthorpe Nurseries underlining the current challenges but reporting that the situation had recently eased in his area.

The evening underlined that the current climate remains positive for mergers and acquisitions. With continuing appetite for personal equity operators to acquire quality settings, there will undoubtedly be further consolidation in the months to come.

Contact RDK for more information