Senior Care Franchises Among the Fastest-Growing Systems
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Our list of the 100 fastest-growing franchises is a diverse lot--everything from a floor refinishing company to tax preparation firms to pizza places and even doggie day care franchises are represented. Despite the assortment of concepts, the list, culled from Entrepreneur's 2011 Franchise 500® rankings, still lets us read the tea leaves of the economy and franchise sector.
Most notable this time around is the rise of senior home care, which seems to be reaching critical mass, with eight senior care concepts making our top 100. After a few years of kicking the tires and cautiously watching to see whether senior care franchises would catch on, franchisees are beginning to invest in proven senior care systems.
"According to the U.S. Census, there are roughly 40 million seniors in the United States right now, and that number is expected to double over the next 20 years or so," says Eric Stites, president and CEO of Franchise Business Review, which recently released a detailed assessment of the franchised senior care sector. "From both a short-term and long-term perspective, it's a market where there's a clear need that isn't going to go away. In-home care isn't something that can be replaced by technology. There's a strong need for the services today, and that need is continuing to grow."
BrightStar Care debuted at number 41 after adding 51 new units in the last year. Chuck Bailey, BrightStar's president, says several factors converged to prime the growth of in-home care companies, and BrightStar plans to open 90 locations this year, including units in England, Ireland and Australia.
Baby boomers, who are reaching the age of 65 at the rate of 7,000 a day, have lots of pent-up wealth, he notes, and are used to paying for services. They also have seen and rejected the nursing home model used by their grandparents and parents and want to stay independent as long as possible. "Baby boomers are using whatever means they can to stay in their home and live a meaningful life," Bailey says.
Michael Newman, who launched Always Best Care Senior Services--which made its debut on our list at position 30 this year--predicts senior care will grow even more as institutions see the value and cost savings provided by the sector.
"Legislators are aging and becoming more in tune with the situation. From a financial perspective, it costs a lot to put someone in a nursing home, it costs less to put them in assisted living, and it costs even less to let them stay at home," he says.
"Governments, insurance companies and PPOs are all looking at this as a less expensive option. We simply don't have enough nursing homes to deal with all these seniors. In-home care makes sense."
Despite the meteoric growth of many home-care franchises, the segment is still highly fragmented and dominated by mom-and-pop businesses of varying quality. Bailey says his company and others set higher standards for care, and as consumer expectations rise, home care will go even more mainstream.
"What you have now is an industry that is like the Oklahoma land rush. There are thousands of companies at the border, ready to rush out and take their space. Because of that, the consumer is confused, and there's no expected standard of service," he says. "But people, as they begin to trust us, will start to spend more money. They're going to Google 'home healthcare' and find a national company like ours and know we do it right."
Newman of Always Best Care agrees. "Now that folks see who we are and how long we've been around, we're gaining traction. People are becoming aware of the opportunity in home healthcare."