Franchise Spotlight: Care Franchise

Recession-proof, benefiting from an inexorably expanding customer base and innovating in a market hamstrung by a lack of original thinking – the Home Instead care franchise has a lot to offer.

Just don’t expect running one to be easy.

I talked to the founder, Paul Hogan, about how he was inspired to start the company, and UK master franchisor Trevor Brocklebank about this care franchise opportunity.

FS Blog: Paul, tell me about how you started the business?

Paul Hogan: We didn’t want to put my 88-year-old grandmother in a nursing home, so we had her stay with my mother for her final year – which turned into 11 years. She regained the will to live, so I realised you don’t need to be a doctor or a nurse to make a big impact.

We organised a group of caregivers in Omaha and provided for other families what we provided for my grandmother.

And that’s how the concept was born. Now we’re in 15 countries with 811 franchise offices.

FS Blog: What do you look for in a franchisee?

Trevor: In this business you’re dealing with very vulnerable people and you need a real passion for what we do as well as having a great business head. It’s no good finding someone immensely caring who can’t run their own business, but you don’t want someone in it purely to make money.

Industry experience isn’t important because we can teach them all that. They need to have good people skills, whether with your clients, caregivers or out in the community with the people who refer business to us.

We’re also looking for people who can run a multi-million pound business.

FS Blog: What sets the Home Instead care franchise apart?

Trevor: The IFA also has an Entrepreneur of the Year award, which Paul won last year.

We won the International Business Expansion award earlier this year. In the same month we won the NHS Dignity in Care award, which, as far as I’m aware, we’re the first private company to have won.

We’d love a bit more competition, because there’s a huge market out there and huge demand for our services. We’re confident, given the quality of what we’ve got, that if other people came along and created more noise, it would be very good not only for the clients we serve – but us as a business too.

FS Blog: What’s your assessment of the current marketplace?

Trevor: The domiciliary market is currently worth about £12bn, which will rise to at least £30bn by 2025.

The market needs to change. The US model is based on getting referrals and clients, whereas most UK care companies are on social-service contracts.

We have a proven business generation model, which makes the phone ring and the business grow, that other UK care franchises don’t operate.

FS Blog: How much can a franchisee earn?

Trevor: They will be breaking even by the end of the first year.

In the US, owners are turning over multi-million pound revenues, with about a 15% margin. So you can extrapolate out to see that substantial earnings possible.

But there’s a big caveat: if people come into this business solely to make money and don’t work, they’re not going to earn a penny.

FS Blog: How many hours are franchisees likely to work?

Trevor: It’s a 24/7 business, so it’s not for the workshy.

But if they follow our model, we can get franchisees out of working in the business to working on the business, so over time you’ll be appointing general managers to run the business on a day-to-day basis. But that will be a couple of years in.

FS Blog: How much of an advantage is the support of an experienced franchisor in such a legislation-heavy sector?

Trevor: Franchising takes a huge amount of luck out of it because you’re buying an established model, particularly in the care industry. We’ve got a whole team just looking at the legislation, ensuring all our policies and procedures are compliant, leaving the owner to focus on running their business.

FS Blog: How difficult is it raising funds in this climate?

Trevor: Banks like lending for a Home Instead franchise as it’s less risky. They’ve vetted our model, they know who we are and what we do.

No business is recession-proof, but if you need care, you need care. You might stop going out on a Friday night for a meal, you might not go for a holiday or change your car – but the last thing most people would lose is care for a family member.

Find out more about the Home Instead Franchise Opportunity >>