Buying an existing day care center is often the easiest day care investment to make. This type of investment can be made relatively quickly and there should be a return on your investment from the day of purchase.

There are many elements to this type of project an investor should be aware of:

Cost: Costs to purchase day care centers vary greatly with their market, their size, and their current profitability. I am familiar with centers priced at less than $100,000 and I've seen a single center priced at just under $7,000,000.

Time: While it may seem simple and fast to purchase an existing business, the process of evaluating the business and securing funding can easily take two months or more.

Location: Even though you are buying an existing business, never forget that day care is a location driven business. Demographic analysis can demonstrate the center's potential to continue to do well, or it can fully explain a slow decline that has no potential to be reversed.

Funding: The process of obtaining funding for an existing business can be short or long depending upon the net worth and credit worthiness of the buyer and the strength and the assets of the business. Funding for day care centers is obtainable through conventional banking and also through the Small Business Administration. For the purchase of businesses without real estate assets, investors should plan to make a cash investment of 30% of the total cost. For the purchase of a business that includes real estate, investors should plan to make a cash investment of at least 10% to 15% of the total cost.