Child Care Advisory, Assurance and Consulting
We work with you and your centre and provide knowledge and insight to navigate the complex and quickly changing sector of child care.
Over 10 years in the sector we have gained extensive understanding and developed best practice insights to guide you to the outcomes you want.
By using us you are supporting your own industry aims and pursuits as we work extensively with the state and national child care peak representative bodies providing expert advice in government consultation.
We understand how critically important the role of these peak bodies are and we are committed to supporting your profession.
|Peter Saccasan |
National Leader, Health Services
T: +61 2 8226 4500
How can we help you?
Child Care Centre FAQs
The prospect of buying a child care centre is an exciting opportunity, but it is also a long-term decision that presents many challenges you need to be prepared for. At RSM we often see where a failure to approach a buying opportunity from an objective standpoint has led to disappointment.
By working with RSM we will provide you with a number of steps to help you make a well-grounded buying decision. By following these steps, you lay the foundations for achieving a positive outcome that you can reflect positively for years to come. Many child care centres, or financial interests in centres, are sold to employees or associates who have been working in the business and are well-informed on the business' workings. Regardless of this, there are many challenges in moving from being an employee to a business owner, and, in these cases, RSM are also able to guide you through the process.
It may be time for new challenges for you personally or perhaps retirement is approaching. Alternatively, your child care centre may not be performing to expectations.
At RSM we work with child care business owners so that whatever the reasons are for electing to sell the child care centre the time is taken to plan an 'exit strategy' in order to maximize the return on investment. It is important to recognize that the process of selling a centre can take a lot longer than anticipated. The process can extend over several years when the child care centre is specialized or the pool of potential buyers limited. You are probably familiar with the saying 'you get what you pay for' - in selling a child care business it is 'you receive the value for what you create'. This means that as a vendor, to get a good price you must stay engaged on the business and maintain its profit while it is being marketed. This requires patience but will increase your probability of achieving a sound price for the business.
At RSM we have developed some sector special tools to help you on the path of improving your child care centre.
Below are just some of these tools:
- Child care business health check
- You may have been operating your centre for some time, and would like to ensure that you are "on track". Our business health check is a simple questionnaire that you can complete yourself to assess whether all the key elements of your business are being taken care of effectively. Child care financial benchmarking Have you ever wondered how your centre's performance compares to your peers, and whether you are missing an opportunity to improve your centre's financial performance?
- At RSM, we have developed detailed analytic tools to benchmark centres of all sizes to assess their financial performance, and how the key performance drivers need to be managed in the future.
Did you know businesses can go under by growing too fast?
The key is to have a sustainable business - that means running the centre at profit margins and volumes sufficient to cover costs and overheads. That also means having a cash flow that will enable you to pay your bills when they need to be paid. Most owners understand sales but don't always fully understand the cash flow cycle and the impact of having too much debt on the balance sheet. At RSM we can help you understand and better manage your cash flow.
At RSM, we take our clients on a journey to ensure that:
- You understand the cash that flows from your business each year
- You understand the impact of your debt load and the need to repay capital
- You know what your income tax obligations are and when they are due
- You are aware of how much you should take out of the business for yourself and how much you need to leave in
- You understand the drivers that improve or detract from cashflow
Before choosing an appropriate business structure for operating a child care business, you need to carefully analyse the commercial and taxation considerations that will affect your personal situation.
You need to consider, not only the immediate issues, but more importantly prospective commercial and family issues that may arise.
The types of entity structures (or combinations of) that may be considered include:
- sole trader
- limited liability partnership
- discretionary trust
- unit trust
- hybrid trust
- service trust
- superannuation fund
Each of these business entities has different legal, tax and commercial characteristics. The choice of business structure is a complex process and specialist advice should be sought prior to making a decision.
Have you thought what would happen if you or your business partner(s) retires, passes away, there is an irreconcilable difference, or serious illness prevents you working for an extended period of time?
Unfortunately, we see a number of businesses who fail to consider these scenarios. Significant added financial stress affecting all partners and their families, invariably follows. There are also those businesses who consider these possibilities and arrange their affairs to ensure their practices can continue to run smoothly, their personal financial situation is under control, and their capital value is maintained.
With an ever-changing sector, it is essential to be mindful of your business and personal goals and to have viable and innovative strategies in place to achieve these goals.
RSM has the expertise and knowledge needed to set you the on the right path.
Implementing an effective strategy has several key components. Firstly, you must understand what needs to be done to implement your strategy; the key to this is understanding your product and its lifecycle. How can you plan for the future if you do not understand the future of what you offer at your centre?
Once you understand where your centre is today and where it needs to be tomorrow then you must choose an appropriate and effective strategy to make it happen. For example, how do you propose to compete in the market? Will you compete on price, and quality, or maybe even create a new niche for yourself?
Not only can RSM help you through these steps but we will also join you on this journey to help you to implement and monitor your business strategy.
Services we provide at RSM