Planning to start a Pre-school facility? Follow these 5 vital steps

Aman Inder Sohi
Aman Inder Sohi Sep 29 2017 - 5 min read
Planning to start a Pre-school facility? Follow these 5 vital steps
Are you an edupreneur? Are you planning to start a preschool facility in your city? This article is an attempt to familiarize you with the steps involved.

A famous quote by Benjamin Franklin ‘An investment in knowledge pays the best interest’ has a correlation with this article. Today, it is clearly evident to witness that education has not only transformed lives, but has also offered profitable business opportunities for multiple edupreneurs. There can be no other noble profession other than imparting knowledge to young minds of the future. A toddler’s first day at school is memorable, where he/she is exposed to the first lesson of what we call ‘Learning’.

As per a market research complied by Technavio, the preschool market in India is predicted to grow immaculately during the forecast period and will also achieve a CAGR of around 22% by 2020. As per researchers, one of the primary growth factors of this industry is the low regulatory requirements in India. The sudden rise in competition among students to get admission in prestigious schools will encourage parents to focus on providing education to their children from early childhood days. This will automatically increase the percentage of students enrolling themselves in preschools. As the market today has a huge potential for growth, it will attract several international schools and kindergartens to penetrate in the market.

Expert Speak
To give a global indication, Vandana Gandhi, Founder and CEO, British Orchard Nurseries, UAE says” UAE preschool industry has grown due to the effort of the UAE government to raise benchmarks by introducing reforms and inspections. This is in line with international practices.”

She further shared, “Over the years, the British Orchard Nursery has continuously adopted the best practices and the most effective learning practices aimed towards a holistic physical and mental growth of children. Our award winning and well researched Early Years Curriculum modelled on the U.K EYFS curriculum focuses on a 3 year rolling plan and personal assessments for every child covering 680 objectives which is measured mainly to ensure that the individual needs are met. It’s unique and we aim to bring this concept to India through joint ventures and franchising.”

Further talking about importance of preschool, Dr Shradha Kanwar, National Head - Learning and Development, iNurture Education Solutions shares," It is important to infuse fun and humour in a child’s life to restore the joy of discovery. It is here that preschool education plays an important role as children are in their formative years and are most impressionable. Investing in preschool education is a smart investment as preschools that create a conducive learning environment have a fantastic future."

Related: 5 Preschools Setting a Benchmark in Franchising

Way to do it

As an edupreneur, this might be the best time to invest in the education sector. If you plan to start a preschool in your city or district, there are couple of things that you need to keep in mind.

Have a business plan ready – While chalking out an outline of starting a preschool, you should ideally have a business plan prepared. Below are the details which should be included in the business plan:

  • Location and space
  • Indoor and outdoor area
  • Infrastructure
  • Funds required for renting, leasing, vehicles, salaries, equipment etc
  • If the business will be full time or part time
  • How many teaching, admin, support staff you need to hire
  • Business mode, Daycare, preschool with afterschool activities etc
  • How many children will you cater to.

Licenses and Registrations
All states Government have their own enacted laws like ‘Private School Education Act’ which regulates the overall operations of the school. Keeping this in mind, before starting a preschool business, it is vital for the promoters to know about the State Education Act and pay to attain related registrations. Preschool can be started as a for-profit and not-for profit enterprise. It all depends on the discretion of the promoter. If the promoter decides to operate the preschool as a for profit enterprise, it is advisable to incorporate a private limited company or a Limited Liability Partnership. On the other hand if the promoter decides to operate as a not-for profile enterprise, a Section 8 Company or a Trust can be registered.

Related: Preschool Activities

Arranging Capital|
For setting up any business, accumulating required funds is a stepping stone. Same goes for setting up a preschool business. You have to arrange funds according to the size of preschool which you want to start. Many banks are proactive enough to lend capital under special discounted schemes. But, it is important to know that apart from providing financial aid for building, interior, furniture or equipment, bank are not liable to pay for staff salary, maintenance, rental and utility bill.

Choosing the Location and infrastructure
Hunting and finalising on an ideal location is very important, as you need adequate place to start a preschool business. A preschool needs to be started at a location, which is child friendly and which has ample space for infrastructure. As for schools, hygiene and cleanliness are very important, one should make sure that the location is well maintained and does not possess any health hazards.

Keep Service Tax Applicability in MindCompliance with tax regulations must be maintained once the school begins operations. Each year, income tax on profits of the preschool may be applicable based on the type of entry established by the promoters (for profit and not-for profit).

Once you take care of all the above points in a structured manner, the process of starting and maintaining a preschool business will be a smooth one.

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