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I am in the process of opening a new preschool.

I am looking for some advice on whether I should be a profit making business or a non-profit making?

What are the pros, cons and differences?


Also, do I have to have a committee for the preschool or can I be the sole owner and make all decisions?



Sorry for all the questions!

Thanks x :o

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I'd have thought, if you're setting up from scratch and at this point in time no-one else is involved in your venture, that itwould be up to you to decide what kind of group you want to be.


Sorry, just re-read your post. I'm a sole trader and so everything is down to me. If you were to form as a community group and could attract a highly motivated and skilled committee you would have people to carry out various tasks associated with running the group - treasurer, secretary, chair, someone to co-ordinate the waiting list etc. However as the owner of my group I have much more autonomy and can decide on my own ethos, what to buy and for how much, whether to stay open or close when it snows without having to go to a committee for their approval.


As a private group I cannot take advantage of charity status, however I know many (but by no means all) community groups benefit from lower rent charges. They can also apply for grant funding more easily than private groups can.


I admire anyone who has the confidence to set up from scratch, especially at a time when there is so much uncertainty and change. Have you got as far as doing your business plan yet, or are you at the planning stage? If you haven't done your business plan, I'd look very carefully at how your Local Authority is going to administer the single funding formula and think about how that will affect your future profitability. Will the hourly fee for funded children cover your hourly fees, and will be there an annual uplift in funding to allow for inflation? If not, can you attract enough non-funded children to offset these losses.


Talk to your local authority, get advice from business link about the various models you have mentioned, and consider seeking advice from organisations such as the National Day Nurseries Association or the Pre-school Learning Alliance.


Good luck - keep us informed about your progress, and what you decide to do!

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