What costs come on top of the price when buying a daycare centre?

The price is discussed first, but it is not the whole cheque. A buyer who budgets only for the price can be short in the first weeks, when payroll runs before fees arrive and small repairs appear. Build a second list, the acquisition budget, so the cash you need at closing and just after is on paper before you commit.

Fees and closing costs

Expect to pay your lawyer and your accountant, and possibly an inspector or other specialists for the due diligence. If you borrow, the lender may charge fees and ask for its own legal work and appraisals. Ask each professional for an estimate of the whole job before you start, and ask which costs are paid at closing and which come later.

Working capital and the handover

A centre pays its staff before some of the money comes in, so you need a cushion. Ask your accountant how much to hold through the handover. Ask whether the seller will stay on for a time, and whether you must cover wages for that period. A lender may count working capital as part of what it will finance, so raise it early.

Deposits, prepaid fees and what the building needs

Parents may have paid deposits or fees in advance. Ask how these are held, and who owes families what after closing. See what happens to parent deposits and prepaid fees. Allow for equipment, play structures and repairs an inspection turns up, and for staff training in your own procedures.

• Professional fees for the legal, accounting and inspection work.
• Lender and closing costs.
• Working capital for payroll and supplies.
• Deposits and prepaid fees you take on.
• Equipment, repairs and training.

Monthly costs are a separate question, covered in what goes into a daycare’s monthly running costs.