Childcare Market & Operators In Australia

  • As at December 2018 there were 7,574 Long Day Care (LDC) centres in Australia, growing by 4.7% for CY18
  • Supply of new centres exceeded child demand growth for most of 2018 by an estimated 75 centres or 1.0%. The growth in new centres reduced in the last few months
  • New supply is absorbing closures of older inefficient centres. 73 centres closed in CY18 (27 centres closed in CY17)
  • In CY18 VIC and NSW had the greatest number of new centre openings (accounting for a combined 60% of the total new supply)
  • Supply is expected to moderate in 2019 and beyond with higher barriers to entry becoming increasingly more difficult:
    – Bank lending criteria has tightened further
    – Councils approval processes are becoming more challenging
    – Operators continue to remain cautious in regards to location and centre selection and have decreased funding capacity
  • Analysis indicates that ~60% of new centres are located in areas where the child-to-place ratio sits above 3:1

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