Building a preschool franchise might be a lucrative business opportunity for business owners who desire to pursue the education industry with a known reputation, curriculum, and operating structure. However, one of the initial questions asked by every potential franchisee is, “How expensive is it to open a preschool?”
The answer is not as simple as the ad put in the paper for a franchise fee.
The actual cost of your preschool franchise may include the franchise fees, interior, furniture, learning area, play equipment, branding, employees, marketing, rent deposit, registrations and working capital. The total investment will vary according to the brand, location, size of property and facilities.
For instance, Makoons' overall investment for the preschool setup is currently priced at ₹12 lakh to ₹25 lakh, and it mentions that the actual amount of investment for your preschool would depend on the tier of the city, property size, and whether the property is owned or rented.
Therefore, instead of reading one headline number, prospective investors should know where their investment dollars are going.
This guide tells you what the biggest pieces of the franchise investment puzzle are, how the costs are divided between franchise fees and total startup costs, and offers some key questions to ask before you enter an agreement.
What Is A Preschool Franchise Cost?
Preschool franchise cost is the sum of all the costs that are required to open and set up a franchised preschool to run.
It can include:
Franchise fee
Property-related expenses
Interiors and renovation
Furniture
Materials and resources for learning and teaching
Play and Toys equipment.
Branding and signage
Technology
Safety equipment
Proper staffing and training of staff.
Marketing
Professional fees and licenses paid
Rent/security deposit
Initial working capital
The crucial point to remember is:
Franchisee fees do not equate with total preschool investment.
The franchisee may have to pay a franchise fee for the opportunity to market a brand and use the brand's systems, but they also may need to invest a great deal more to get the centre ready and running until admissions are established.
How Much Does A Preschool Franchise Cost In India?
There is no fixed model of the price of preschool franchises in India. This variation is illustrated by the examples of current markets. Currently Makoons is offering an overall investment range of ₹10 lakh to ₹25 lakh for its preschool education. Its website also says that it is built in the minimum space of about 1,500 square feet, along with 500 square feet of play space.
Other franchise offers and business models may tout significantly lower or higher amounts, depending on the format.
A recent article on Makoons also mentions a wider indicative price range between ₹12 and ₹25 lakh for a regular preschool, with a lower cost for smaller, low-investment preschools.
1. Franchise Fee
Typically, the sum is paid to the franchisor for their trademark, business system, curriculum, intellectual property, and other assistance.
The fee can give you access to any of the following, depending on the company:
The naming and identity of a brand.
Curriculum
Training
Operational systems
Marketing resources
Technology platforms
Business processes
Pre-opening support
Franchise agreements can vary widely, though.
The franchise fee may be packaged with the other investment expenses by some brands.
For instance, Makoons now says its franchise fee is part of its investment ranges.
Before paying, ask:
What is the amount of the franchise fee?
Is it refundable?
For how long will the contract be in effect?
What's covered in the fee?
Does renewal have to be paid separately?
Do they have annual or recurring fees?
2.Preschool Setup Cost: Interiors And Renovation
One of the highest cost elements of preschool startup is the physical environment.
A preschool isn't just about pretty walls. The area should be planned to accommodate children's safety, mobility, play, and learning.
Expenses may include:
Flooring
Painting
Child-friendly furniture
Classroom partitions
Storage units
Reception area
Activity spaces
Lighting
Electrical work
Washroom improvements
Safety modifications
Outdoor play area
A franchisor can offer specifications of design or guidelines for infrastructure.
For instance, it offers advice on infrastructure design, and it needs a clear built up and play area layout, Makoons explains.
Avoid excessive spending on decorating.
While a colourful preschool may be attractive, not all fancy decors will make children learn better.
Prioritize:
Safety + Functionality + hygiene + age appropriate learning environment
before decorative features.
3. Furniture And Classroom Equipment
Each classroom needs adequate furniture and storage.
Typical requirements include:
Child-sized tables
Chairs
Shelving
Teacher furniture
Storage cabinets
Book racks
Activity tables
Mats
Display boards
Learning corners
This will vary based on the number of classrooms and children.
The more children in a preschool, the more furniture the school needs.
4. Curriculum And Learning Materials
This is an important component that shouldn't be overlooked.
The features a quality preschool might include:
Curriculum resources
Storybooks
Flashcards
Art materials
Manipulatives
Puzzles
Blocks
Sensory-learning resources
Worksheets
Teacher guides
Activity materials
Children aged 3-8 years are categorized into the Foundational Stage of the National Education Policy 2020 with focus on flexible learning that is play and activity-based.
When you're looking at education franchise costs, you shouldn't just inquire about the number of books or worksheets included. Evaluate the quality and educational approach behind the curriculum.
5. Play Area And Equipment
Play is a key component of any child's early education.
The setup will depend on the preschool model and may include:
Slides
Swings
Climbing equipment
Soft-play equipment
Balance equipment
Aggregate or sensory play materials
Outdoor activity materials
Equipment must be age appropriate, and safely installed.
The cost of setting up a play area for preschoolers might be less if you rent a property that already has a play area.
6. Branding And Signage
Parents must easily find your preschool.
The costs of branded items can include:
Exterior signage
Reception branding
Classroom signage
Direction boards
Wall graphics
Admission brochures
Printed materials
Uniform branding
Promotional materials
Some franchisors have branding as part of the package.
For example, Makoons presently claims that brand and signage are included in its franchise investment package.
Always ask the meaning of "branding included.
7. Technology And Security
Today, technology may be necessary for the function and safety of preschools.
Potential expenses include:
CCTV cameras
Computer/laptop
Internet connection
Attendance systems
Parent communication software
School management software
Where appropriate, use biometric systems.
Digital marketing tools
Don't forget about software subscription fees; they can be an ongoing expense, too.
8. Staff Recruitment And Training
The teachers and support staff are one of the biggest investments that you will make.
Some of the costs you might face initially are:
Recruitment
Background verification
Teacher training
Orientation
Uniforms
Teaching resources
Initial salaries
While a franchise may offer recruitment and training assistance, salaries typically do not constitute part of the assistance of the franchise.
For instance, Makoons says it assists in hiring, trains the staff in curriculum, classroom management, and daily issues.
9. Marketing & Pre-Lauch Promotion
The trick to opening a beautiful preschool is not enough, if the families do not know that it exists.
These are some of the first marketing expenses you might pay from your initial marketing budget:
Digital advertising
Local SEO
Social media
Brochures
Banners
Open-house events
Launch campaigns
Residential community outreach
Admission campaigns
There are some franchisors that offer pre launch marketing support.
At this time Makoons claims that the franchise package it offers includes the pre-launch marketing campaign and serves as admission support for the first academic year.
But then ask if this represents the franchisor's marketing services, or merely templates and guidance.
Those things are quite different.
10. Rent And Security Deposit
Rental costs can be one of the largest expenses if you don't own the property.
Some of the first properties you invest in may be:
Security deposit
Advance rent
Brokerage
Lease documentation
Renovation permissions
Utility deposits
The economics of the preschool can vary greatly depending on its location.
Occupancy costs at a centre in a high-quality suburb can be very different from those in a lesser known city.
That's why it is misinformed to compare prices for preschools without taking into account location.
11. Licenses, Registrations And Compliance
Depending on your city, state, premises and business structure, you may be required to obtain various registrations, permissions or safety compliances.
Possible needs include:
Business/entity registration
Local municipal requirements
Fire-safety requirements
Building-related permissions
Requirements and facilities for shops and establishments
Labour-related compliance
Tax Registrations (where applicable),
Child-safety procedures
Conditions are likely to be different in each state and local authority, so don't just take a generic franchise brochure.
Before signing a lease agreement, verify it with local requirements.
12. Working Capital: The Cost Many Investors Forget
This is likely the most critical investment in your preschool franchise.
It may take some time for your preschool to meet its target enrollment.
Funds may be required for the first several months of:
Salaries
Rent
Electricity
Internet
Marketing
Maintenance
Cleaning
Learning materials
Administrative expenses
So, don't spend all your money on the physical set up.
A better approach:
Break your money into two general categories:
Opening capital
Franchise
Interiors
Furniture
Equipment
Branding
Operating reserve
Salaries
Rent
Marketing
Utilities
Maintenance
Unexpected expenses
The amount of the reserve will vary according to your geographical location and business plan, but having a respectable cash cushion in place will help to keep unnecessary pressure off of your finances during the first few months.
Franchise Fees India: What Recurring Costs Should You Check?
The initial payment isn't necessarily the end of your financial commitment.
You can find a wide range of things depending on the franchisor:
Royalty
Marketing fees
Technology fees
Annual renewal charges
Training fees
Curriculum/material charges
Mandatory purchases
Software subscriptions
Not all of these are included in all of these brands.
Currently, Makoons advertises a zero-royalty business model, for instance.
This is an example of why it is important to compare franchise fees in India by considering the entire business dealership, rather than just the initial franchise fee only.
Final Thoughts
Before you get into the preschool business, it's important to know how much a preschool franchise business costs. The cost that a franchisor advertises is just a base cost—the actual cost of your preschool franchise could cover the franchise fee, interiors, staff salaries, marketing, property, safety equipment, working capital, and much more.
If you want to work out the cost of a good play school franchise, you should not just consider the start-up fee. Analyze the full costs, ongoing fees, curriculum effectiveness, training, support, requirements for places and anticipated ongoing costs.
In Makoons, the total investment required for a preschool setup is estimated to be between ₹12 lakh to ₹25 lakh, and they outline support services such as infrastructure guidance, curriculum, branding, and support with pre-launch marketing, staff training, and admission assistance. It also promises a no-royalty option. Here are some examples of the type of information a potential franchisee should look for in every brand out there before he/she chooses.
Ultimately, the right franchise isn't necessarily the one with the lowest preschool franchise pricing. It is the one that your market can sustain, both in the long term and in its investment, support system, educational model, location and the long term operating economics.
Make sure you do your financial projections carefully, get an itemized quotation, read the franchise agreement carefully and have adequate working capital in place to allow your preschool to get going. A good investment plan for a preschool is based on realistic numbers, not an appealing franchise fee.
Frequently Asked Questions
1. What is the average preschool franchise cost in India?
There is no overall average for the industry. There are variations in costs based on the brand, location, property size, infrastructure, and franchise model. For instance, Makoons now offers an investment of ₹12 lakh to ₹25 lakh for its preschool facilities. The other models are lower or higher; investors should ask for the latest location-specific quote.
2. What does a preschool franchise fee usually include?
The fee can vary, depending on the franchisor, and may include access to the franchise brand, curriculum, training, operating systems, marketing, and other franchise support. But inclusions have been found to range widely. Before paying for an itemized list of what is and isn't covered should be requested.
3. Are the investments to open a franchise the same as the franchise fees?
NO. Franchise fees are typically just a piece of the total preschool franchise investment. Interiors, furniture and equipment, branding, rent deposits, staff recruitment, marketing, registrations, working capital can also be part of the total investment.
4. What are the differences between the start up cost of preschool and play school franchise?
Preschool startup cost is a generic term that encompasses the expenses needed to start up and operate a preschool. Play School Franchise Cost is the amount of money invested in opening a play school that is franchised. The latter can be accompanied with a franchise fee and brand-specific setup requirements, aside from normal startup costs.
5. Are there recurring fees after paying the initial franchise fee?
It is at the discretion of the franchisor. Examples of possible recurring charges include fees for royalties, marketing contributions, technology, renewal, and required purchases of learning materials. Other brands promote no-royalty models, such as Makoons today claims to be no-royalty.
6. What are the benefits of investing in a preschool franchise?
Take a number of years' costs, not just the initial franchise fee. Assess the curriculum, brand, franchise agreement, royalty, terms of renewal, property, teacher training, marketing support, admission assistance, ongoing costs, and working capital requirements. It's also wise to get the commercial contract checked by an independent legal or monetary advisor before signing.
Topics to Explore:
How To Increase Preschool Admissions After Opening
How to Start a Preschool Franchise in India
