Trend Watch: Senior Care Franchises
For many seniors, the golden years represent a period of relaxation--a breath of fresh air after a lifetime of work and responsibility. For today's entrepreneurs, meanwhile, the golden years also mean a golden opportunity. Visible on the horizon is an unprecedented demand for senior care, as the first wave of baby boomers turns 65 in 2010. Born between 1946 and 1964, this unique market will soon push the number of Americans ages 65 and older to 39 million. And as America grays, the senior-care franchise industry is gaining new life.
In the next 30 years, the number of people 65 and older is expected to double, and the number of people over age 85 will triple, according to James Firman, president and CEO of The National Council on the Aging, a nonprofit advocacy organization dedicated to improving the health and independence of seniors. "There will be a huge expansion in the need for services to help people stay at home or in whatever facilities they're in," he says. The senior-care industry will "definitely be a major growth industry."
And growth in the demand for senior care should stay vital for a while--seniors aren't just increasing in numbers, they're also living longer. According to the U.S. Census Bureau, the average life expectancy in 2000 was 74 years for men and almost 80 for women, compared to 66 years for men and 72 for women in 1950.
The true impact of the aging of the baby boomers won't be felt for several years. Yet, due to Americans' changing lifestyles, senior-care franchises already have their hands full. Seniors are depending less on their families and more on outside resources to receive the help they need. Comfort Keepers and Home Instead Senior Care, which each operate more than 400 locations nationwide, are just two examples of franchises that offer the elderly nonmedical services such as companionship, meal preparation and transportation. Comfort Keepers reported franchise growth of 17 percent in 2003; meanwhile, Home Instead's total number of franchises grew by 24 percent.
The America that existed a century ago is not the same as the America of today for seniors, due to economic issues, mobility and people choosing to have children later in life. Traditional family structures have changed dramatically. According to the Bureau of Labor Statistics, there were almost 29 million married, dual-income couples in 2002. These numbers have generally been on the rise since the federal government started tracking them a decade ago. For seniors, this means less help from family members who are busy working. "Most care providers of this type of service are the family members themselves," says Jerry Clum, who co-founded Comfort Keepers with his wife, Kris, in 1998. And, says Jerry, the dual-income trend is "placing a great deal of stress and difficulty on these families."
Another trend that's increasing the need for senior care is the mobility of Americans. Education and careers often lure the younger generation away from their parents. "Family members aren't as near to each other as they used to be," says Jerry.
Another factor affecting care for elderly relatives is that many baby boomers have in fact waited longer to have children, says Firman. Consequently, a new generation has emerged, known as the "sandwich generation." "In the typical American family, people in the 40 to 55 age range have children and the elderly to take care of at the same time," says Paul Hogan, who founded Home Instead Senior Care with his wife, Lori, in 1994. "That's causing a strain."