The childcare sector is grappling with significant financial challenges. Rising costs, coupled with fluctuating demand due to changing work patterns and economic uncertainty, are pushing many providers to the brink. The closure of over 2,500 providers since 2021 underscores the growing financial strain.

Alongside the noted decrease in occupancy rates, there are additional challenges. These include rising operational costs, such as staff wages, rent, and utilities, which continue to escalate without a corresponding increase in revenue. Furthermore, the sector is navigating stringent regulatory requirements, which, while crucial for maintaining high standards of care, impose additional financial and administrative burdens on providers.

The combination of reduced income due to lower enrolment and increased expenses is placing immense financial strain on nurseries and childcare facilities, compelling many to reconsider their viability and future operations

Here at Company Debt, we have significant experience in both closing and restructuring childcare businesses. Get in touch for a free, no-obligation discussion about your situation with one of our licensed insolvency practitioners.

Childcare Pressure Points

Insolvency & Rescue Solutions for the Childcare Sector

What are the Reasons for Insolvency in the Childcare Sctor?

Childcare facilities are struggling financially due to several factors:

  1. Labour Costs: The increase in the national living wage, now including younger workers, places significant financial pressure on childcare facilities by raising payroll expenses.
  2. Staffing Decisions Post-COVID: As government support like the furlough scheme concludes, childcare providers face difficult choices regarding staff retention or redundancies, directly impacting their financial stability.
  3. Operational Pressures: Keeping doors open during lockdowns for essential services added to the sector’s financial strain. Facilities that acquired government loans during this time are now dealing with increased debt levels, including obligations to HMRC.
  4. Demand Fluctuations: The changing needs of families, influenced by shifts in working patterns, have led to unpredictable demand. In some regions, this results in an oversupply of childcare services, heightening the risk of closures or the need for strategic consolidations.
Insolvency & Rescue Solutions for the Childcare Sector

Rescue, Recovery, and Closure Options for Childcare Businesses

We are fully licensed and accredited insolvency practitioners based in north London, and with decades of combined partner experience in helping directors find positive solutions to business challenges.

Our goal is first to understand your situation as fully as we can, and then to explain the range of options available to you.

We focus on practical advice, without jargon. We practice total transparency around costs and fee structures. Our wish is to support you as fully as possible so that you can emerge from this situation in the best possible situation.

As a first step, simply book in a call with one of our team to learn more about our approach, and to take advantage of a fee consultation that carries no obligation.

Book My Consultation

If you need an experienced insolvency practitioner or business rescue specialist, seek advice now.

  • Your free consultation will be led by one of our experienced London insolvency practitioners
  • You can speak via phone, online meeting or in person so that we can listen carefully to the facts about your situation
  • The team will provide a preliminary view of the likely best outcome, proposed strategy, and the likely cost
  • We specialise in helping limited company directors needing immediate professional debt advice


  • This field is for validation purposes and should be left unchanged.