A study on the feasibility of setting up a child day care centre

Abstract

The need for quality Child Care Centres is a current issue in Malta, and quality child care is becoming an increasingly sought after service. This is primarily due to the fact that many families are finding it necessary for both parents to work and reliance on parental support is becoming more difficult as they are tending to retire later. The main objective of this dissertation is to determine whether the setting up of a child care centre, in the light of the recently published national standards, is financially feasibility. These standards are expected to be made legally binding in the near future. The proposed project will be a child care centre which caters for children under the age of three. The demand for such a service will be established through a questionnaire which will be sent out to all registered centres. A site for the school will be selected and floor plans obtained from an architect. The initial capital expenditure, revenue and operating expenditure will be estimated in order to produce a projected Income Statement, and a Cash Flow Forecast. Investment appraisal techniques will then be used to evaluate the feasibility of the proposed project. A sensitivity analysis will follow which brings out the projects volatility to a number of key factors.