Start a Preschool in India – The Business Plan

Pre School in IndiaEvery locality now houses more than one Pre School and with every vacation going by you see the number increasing. A small concept of creche has taken shape of a formidable business called Preschool. There are players who have done brisk business like Zeekids, Roots2Wings, Little Millenium, Bachpan, Treehouse, Hello Kids, Shemrock Feathers, Kangaroo Kids, Birla, Euro Kids, Little Fingers, Globe Toters, Eager Beavers, Jumbo Kids, Makoons, Wonderkids, Blossoms etc. The list in endless and growing.

There has been an incredible adoption of the concept at both the levels

  1. Seekers – People wanting to start this business
  2. Users – People wanting to send their kids to PreSchools

The sector can operate as a private enterprise thus clearing it from the issue of starting a Not for profit trust or a society. The business itself comes with very light baggage in terms of investment – Low Franchise fee and Low infrastructure cost encouraging lot of entrepreneurs to start. one doesn’t require people too qualified to operate this business thus make it easy to recruit and run such enterprise. Obviously the catch becomes scalability, customer business life and low cost of entry for rivals.

Now coming to the business plan (sort of Project Report) for such an enterprise, below are my inputs

Project Requirement:

  •  2500 – 3000 sq. ft. of built-up area, preferably on the ground floor in a residential locality.
  • Some open space for play area becomes an added advantage

Project Cost:

  • Franchisee Fee: Rs 2.5 lacs ~ Rs 5 Lacs depending upon the franchise
  • Teaching aids and materials: Rs 3.5 lacs ~ Rs 5 Lacs  for all  4 classes(Play group, Nersury, KG 1 and KG 2).
  • Teachers Training:  Rs 5618 ~ Rs 10,000 (some brands charge it some don’t; most of the established players do)

Support from the company / franchise / Brand:

There are two aspects which really helps inexperienced in this business pick up the ropes one is Content & Curriculum and the other is Designs and Promotion Materials. Because these are the two things which really costs money and for a Small entrepreneur it is difficult to invest in content research and professional designing.

Besides that this is what Company’s representative shall tell you in the sales pitch –

  1. Content and Curriculum
  2. Teaching Aids
  3. Facilitators (Teachers) Training & Orientation
  4. Commercial Training & Counseling Tips
  5. Competitors Analysis & Data
  6. Regular Visits by Academic experts
  7. Branding & Positioning
  8. Providing Operational Inputs & Product Up-gradation
  9. ERP for managing day to day operations of the school
  10. Digitized and license based curriculum and manual
  11. Guidelines -Traffic Building, Marketing and Promotional Material
  12. Required guidelines & assistance in maintaining Hygiene & Safety
  13. Nutritional Inputs
  14. Continuous Value Addition

Revenue Sharing : 15% royalty will be charged by the company on the fees collection rest 85% will be the franchisee share.

SCHOOL FEE COLLECTION@1st Year2nd Year3rd Year4th Year5th Year
No. of Students60100150200250
Student Fee (a)350002100000350000052500007000000 87,50,000
Operational Expenditure (Opex) :
Salary (Chief Learning Officer)8000 96,000 1,05,600 1,16,160 1,27,776 1,40,554
Salary ( 3 Teachers)6000 2,16,000 3,60,000 6,00,000 7,20,000 9,00,000
Salary (3 Aaya)3000 1,08,000 1,44,000 1,80,000 1,80,000 2,16,000
Office Boy3000 36,000 39,600 43,560 72,000 79,200
Rent25000 3,00,000 3,15,000 3,30,750 3,47,288 3,64,652
Utility5000 60,000 1,00,000 1,50,000 2,00,000 2,50,000
Stationery 10,000 20,000 30,000 40,000 50,000
Marketing(as per requirement) 2,00,000 1,00,000 1,00,000 1,00,000 1,00,000
Royalty 3,15,000 5,25,000 7,87,500 10,50,000 13,12,500
Student Kit & Uniform
Total Expenditure (b) 13,41,000 17,09,200 23,37,970 28,37,064 34,12,905
Net Profitability (a-b) 7,59,000 17,90,800 29,12,030 41,62,937 53,37,095
Day care - 12 to 4 pm
DAY CARE@1st Year2nd Year3rd Year4th Year5th Year
Day Care Kids2030405060
Fee Collection (c)20000 4,00,000 6,00,000 8,00,000 10,00,000 12,00,000
Salary (Teacher-2)5000 1,20,000 1,20,000 1,20,000 1,80,000 1,80,000
Salary (aya-2)2000 48,000 48,000 72,000 72,000 96,000
Food and Milk-----
Total Expenditure (d) 1,68,000 1,68,000 1,92,000 2,52,000 2,76,000
Total Income (c-d) 2,32,000 4,32,000 6,08,000 7,48,000 9,24,000
Activity / Hobby Classes ( 5 - 8 PM)
ACTIVITY CENTRE(Yoga/Music/Dance etc)@1st Year2nd Year3rd Year4th Year5th Year
Evening Activity Kids3040506070
Fee Collection Û monthly1000 3,00,000 4,00,000 5,00,000 6,00,000 7,00,000
50 % to Partner (f)-total expense50% 1,50,000 2,00,000 2,50,000 3,00,000 3,50,000
Total Income (e-f) 1,50,000 2,00,000 2,50,000 3,00,000 3,50,000
Total Income (a+c+e) 28,00,000 45,00,000 65,50,000 86,00,000 1,06,50,000
Total Expenditure (b+d+f) 16,59,000 20,77,200 27,79,970 33,89,064 40,38,905
EBITDA 11,41,000 24,22,800 37,70,030 52,10,937 66,11,095
EBITDA Margin41%54%58%61%62%
Franchisee Fee250000
Teaching Aids Materials (TAM)350000
Interior - Exterior and marketing200000
Total Capex-800000

Doesn’t matter what business you start, till the time you can manage your expectation from it, you will stay happy. For this business also, one has to realise their are issues with scalability, sharing of royalty, low shelf life of customer, low intellect workforce requirement, costs always under stress due to low entry barrier by the competition  etc.

If you can make peace with all the above, this business is here to stay and growing.

Abhiney Singh

Abhiney Singh

I run a school called Brighton International School ( I am also now a partner with a School consulting company which helps budding educators or investors start school or gain access to help related to school. The help could be in the form of Turnkey School Consultation, Detailed Project report, Project Finance, Business Plan consulting, Recruitment planning, Infrastructure consultation, Affiliation Consultation, Teacher’s Training, Academic and Curriculum Planning. I now have a decade of work experience. I strongly believe in improving every day and I have tremendous respect for people who pursue their dreams with undying passion and enthusiasm. I have worked in Mumbai for about 6 years as a Marketing-Media professional which has helped me in shaping what I am today. I am Chemical Engineer with an MBA in Marketing. You can know more about me at You can mail me on or call me on +91 70002 40006. This number is also on whatsapp.

16 thoughts on “Start a Preschool in India – The Business Plan

  • March 16, 2020 at 7:08 pm

    Hi Abhiney,
    How should I go about selecting a location in a city. Is there any framework or check points one should keep in mind while selecting a location? To be specific how can I be sure that there is a market/need for a school here in this locality?

    • March 21, 2020 at 2:08 am

      Hi Tina,
      I am going to write a separate post on this question, kindly keep checking my blog.

  • March 5, 2020 at 11:12 am

    Hi Abhishek,
    Happy to see you with your experience in school and marketing.I have just one important query that I should go with Franchisee model or self brand to open a pre school.Which will be better in long term.

  • February 2, 2020 at 3:55 pm

    Dear Mr. Singh,

    Thanks for your valuable brief about pre-schools. I am interested in a franchise pre-school in Nashik. I am currently looking for options, I have gone through Little Millenium and SHEMROCK’s proposals. But not able to decide which one to go for. It would be great if you could help me in this journey. Looking for your support and guidance. Thanks again!


    • February 14, 2020 at 1:59 am

      Dear Bhushan,
      Though I am not a Pre-School specialist, since you have asked I shall give you my feedback. Pre School as a business in small bungalow/ Flat doesn’t make much sense since the competition is high and the establishment is always reeling under the admission pressure. If you have a land more than 5-10 thousand square feet, go for customised infra, that should work. Franchise doesn’t really matter.

  • November 14, 2019 at 11:42 am

    Can it be run as a pvt. Ltd initiative. What are registration requirements for Madhya Pradesh

    • November 26, 2019 at 7:12 am

      You mean to ask ‘Can schools be run as Pvt. Ltd initiative” – The answer is ‘NO’. They have to work as a Not-For-Profit entity under a Section -8 Company / Society or a trust.

  • November 29, 2018 at 3:43 pm

    Hello Mr. SIngh

    I am a certified ECCed teacher and now relocated from mumbai to Nashik Maharastra.
    I wish to start my own preschool and activity centre in a prime location of nahsik. Need your suggestion on wheather i should buy a property outright or take it on lease intially.
    Also how well will a preschool and activity centre run on a 1st floor of a commercial building with an area of 2000sqft.
    Thank you

    • December 6, 2018 at 10:43 am

      All depends on your risk appetite. I cant comment on the location since I haven’t seen it myself. The entire Pre School sector works where the the residential areas are nearby.

  • April 16, 2018 at 12:41 pm

    Hi Abhishek,
    I wanted to open a private primary school and i want the sectors like kidzee to help me how am I suppose to proceed.. please reply.

    Bhawana Rai

    • July 19, 2018 at 8:34 am

      Dear Bhawana, Kidzee does extensive online marketing — just go their website and express your interest. They will come chasing you.

  • September 20, 2016 at 2:53 pm


  • June 29, 2016 at 8:15 pm

    Hi Abhiney,

    I need your help to start a school in Singrauli.

    Please share your contact details

    Abhishek Singh

    • July 19, 2016 at 9:31 am

      Dear Abhishek,
      I believe we have spoken. Let me know if you need help.


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