Manchester City Council (MCC) is shortly to issue application forms through The Chest for providers of childcare to get the opportunity to bid to lease one or more of 29 childcare centres across Manchester. Bidders will have to take on a full repairing and insuring lease, a significant risk, that providers will need to build into their business plans. In some of the centres part of the building will be leased back to MCC for the continuing provision of Surestart. Each of the bidders will be required to reserve 3 Child in Need places for use by MCC. In all but 7 of the centres existing childcare will have ceased. The application forms will assess both financial and quality issues and the top 7 applicants for each centre will then enter a second phase where they make offers both for the rental amount and length of the lease. No detail was given as to how the second phase of the process will work.
At a Market Warming Event held at the Etihad Stadium on Fri March 1st, Jenny Andrews, Deputy Director of Children Services, emphasised the commercial opportunities; a growing 0-4 population; growing number of funded 2 year olds; increasing levels of employment; and economic growth.
Applicants face a difficult task in deciding on the level of their offer. They will have to develop a business model based on an estimate of demand within the catchment area of each centre they wish to bid for. They will then need to assess the level of risk posed by the taking on of a lease and build this into their business model. New, well-maintained buildings in areas of high employment and high numbers of pre-school children are likely to attract lots of applications whereas areas of higher unemployment, where the building is in poor repair or has been subject to vandalism, may not be seen as viable. Larger providers, if successful in applying for a greater number of centres may be able to attract finance and spread risk whilst smaller suppliers may face unacceptable levels of risk. As in any business where there are not high levels of profit bidders may over-reach themselves and fail. Support for bidders is available through Blue Orchid and 1:1 briefings can be organised through contacting [email protected]. Support for voluntary and community organisations wishing to apply is available through the Capacity Building Team at Macc. Further documentation, including the application forms are only available through registering on The Chest, the North West's Local Authority Procurement Portal.