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The Business of Caring: Top Senior and Child Services Franchises
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The senior and child services franchise sectors have some of the most satisfied and successful franchisees. This isn’t surprising since these businesses provide a “feel good” service offering with, in many cases, attractive unit economics. This special dual-sector report takes an in-depth look at what it’s like to be a franchisee at senior and child services franchises and the brands ranked highest by the franchisees who own them. While most of the content of the report is pasted below, in order to to see the list of 2016’s Top Senior and Child Services Brands, you must click on the report above or download the full report in PDF format and go to page 6. The full report contains a lot of helpful information that is not featured below such as how to fund your franchise on page 5 and how franchisee satisfaction varies between child and senior services franchises on page 10.
Booming Senior Services Franchise Sector Proves What’s Old is HOT
Demand for services that help seniors is booming and will continue to grow as 10,000 people turn 65 everyday. By 2030, 70 million Americans will be over the age of 65. With life expectancy getting longer and longer, individuals reaching age 65 have another 20 years on average to live.
The fastest growing senior services franchise segment is private homecare for several reasons. It meets the desire seniors have to maintain their independence and stay at home as long as possible. It is more affordable than other senior care options as the following cost breakdown shows: $81,030 for a semi-private room and $90,520 for a private room in a nursing home; $42,600 for an assisted-living facility; and $21,840 for homecare based on 20 hours per week. In addition, the Affordable Care Act is benefitting the home care industry by encouraging hospitals and rehab centers to promote homecare after patients are discharged in order to reduce the number of unnecessary readmissions.
“The homecare landscape will see continued growth in the number of providers since the demand for services will only increase,” says Kathleen A. Gilmartin, President & CEO of Interim Healthcare. “The challenge will be in recruiting and retaining the best caregivers and clinicians to meet the demand.” When it comes to the future of homecare, Gilmartin also believes the requirements and standards for quality metrics, data reporting, and technology-assisted care models will become more commonplace.
Most homecare franchises on our awards list on page 7 have a primary focus on non-medical care (e.g. meal preparation, grooming, bathing, transportation, and companionship) for seniors, as well as in many cases to non-seniors (e.g., post-surgical assistance, post-partum care), that can be provided by caregivers who do not have a medical license. Three—BrightStar Care, Interim Healthcare, and Qualicare Family Homecare—also offer medical services (e.g. catheter care, injections, IV infusions, tracheotomy care, ventilator patient care) that are provided by a nurse, home health aide, certified nurse assistant, licensed vocational nurse, or a doctor. In-home medical services are usually covered by private insurance or Medicare. Since only a handful of franchises offer in-home medical care, this may offer their franchisees a competitive advantage. However, providing medical care entails more billing and state and federal regulations compliance paperwork. If you’re looking at a franchise that offers medical care, it is particularly important to ensure you will receive the support you need from the franchisor to effectively manage it.
Although the majority of franchises in this report provide homecare services, two— CarePatrol and 101 Mobility—offer other types of senior care services. CarePatrol provides free senior housing placement services that help families find independent living, assisted living, memory care, and in-home care options. 101 Mobility offers and installs mobility and accessibility equipment, primarily lifts and ramps.
HOW MUCH WILL YOU HAVE TO INVEST?
The median initial investment required to open a single senior care franchise location is $107,500. There are, however, opportunities that are less costly such as Qualicare Family Homecare, which has a minimum investment at $65,800. Most senior care franchises don’t initially require office space or a significant amount of start-up equipment.
To purchase a senior care franchise, you will need to be well financed and plan on not taking a salary for at least the first year of business. The investment, however, is worthwhile for many since it is not uncommon for franchisees at top senior care brands to generate gross revenues of up to a million dollars or more, which is highlighted by several of the franchisees featured within this report. The average gross income figure for the senior care concepts we surveyed was $118,140. When compared to other franchise sectors such as food and retail, which typically require an initial investment of $500,000 or more and operate with slim margins, senior care franchises provide a particularly appealing business opportunity.
Like most franchises, the time investment required to manage a senior care franchise is significant, especially in the beginning when franchisees are getting the business up and running. The time commitment typically decreases once a management team is in place.
“Currently we work about 40 hours per week and vacation when we want, “says Visiting Angels franchisee, Michael DiAsio. “However, when we first took over the franchise and for the first several years, we worked roughly 60 hours per week. While long vacations were fewer then, we still took time quarterly for long weekend breaks, which many times were a management retreat. These were great for recharging.”
“There was no work/life balance when I started the business. I worked harder in that first year than I’ve ever worked, but that’s who I am. I don’t like to extend the painful part of starting a business any longer than I have to,” says Amada Senior Care franchisee, Robert Christensen. “Today I have an amazing team in charge of my operation and I have a tremendous amount of freedom. Over the last six months, I’ve been on three hunting trips, a vacation to South America, and I’ll be joining the Amada leadership team in Costa Rica for an all paid awards trip.” Christensen purchased his Tacoma, Washington location in 2012. In 2015 he says he grossed just over $5 million and that he is projecting his gross revenue will be over $8 million by the end of 2016. He attributes his success primarily to his 20 years of pharmaceutical sales experience.
IS A SENIOR SERVICES FRANCHISE THE RIGHT FIT FOR YOU?
Leading franchisors know that the health of their systems relies heavily on selecting the right franchisees. Each has specific criteria it looks for in candidates.
“We look for franchise candidates who demonstrate a track record of career success in business, marketing or customer service. Healthcare experience is helpful, but not required,” says Gilmartin, of Interim Healthcare. “We’re interested in why the candidate is looking at the care sector and how much diligence they have put into understanding the dynamics of home healthcare. It’s our goal to find strong franchisee partners who desire to deliver services across the care continuum including personal care and support, skilled nursing, and therapy delivered to people in their homes.”
The background of Homewatch CareGivers’ franchisee, Reena Sharma, confirms Gilmartin’s stance, “I studied economics and psychology and spent 20 years in various management positions in the consulting field. The skills I acquired during these years, including the ability to manage organizations and people with an eye to process, technology, and strategic excellence, have contributed significantly to my business’s success.” Sharma purchased her franchise in Westbury, NY in 2013. She states her 2015 gross revenue was approximately $1 million and that she anticipates it will be $1.4 million in 2016.
Starting and managing a successful franchise is just as much hard work as owning any business. Lane Kofoed, CEO of Assisting Hands, says, “The keys to success for our business owners reside in setting realistic goals, committing to providing superior client service, and calling on others for wisdom and support regarding establishing goals, implementing plans, and more.” Assisting Hands reports in its Franchise Disclosure Document that as of 2014, the average gross revenue for its franchise locations open at least 12 months was $934,689.
BECOMING A SENIOR SERVICES PROVIDER
There are a variety of reasons people seeking to be self-employed purchase a franchise instead of creating a business from scratch. The primary one is that franchises tend to have a higher success rate than start-ups do because they offer a blueprint for success— proven systems and ongoing support.
“I’ve owned other businesses before so I knew what it’s like to take on the risk of starting from scratch,” says Christensen of Amada Senior Care. “With a franchise, that risk has already been taken for you and the model is already proven. You just have to plug in, follow the system, and, of course, work your tail off!”
As Visiting Angels franchisee, Michael DiAsio says when it comes to researching a franchise opportunity, “Haste Makes Waste. Listen to what your parents taught you: Do your homework!” Homewatch CareGiver franchisee Sharma recommends that franchise candidates, “Analyze and compare options inter and intra-industry, shadow a franchise owner if possible, and ask the toughest questions of both franchisees and franchisors until you feel 100% satisfied with the answers.”
DiAsio and his wife, Jacqueline, purchased an existing Visiting Angels franchise in Henderson, Nevada in 2010 that had been opened in 2000 by the previous owners and had about 150 employees. His advice regarding purchasing an existing franchise is, “Make sure that you are comfortable with the financial statements, tax returns, and business valuation. If you do not get the price you want ensure you get the terms (eg. amenable seller financing) you want. Write into the agreements that the seller has to operate the business up to closing as they normally operate. No slacking off or the purchase price should change.” DiAsio says his franchise’s gross revenue is in the seven figures and that it experienced “hyper” growth over the last six years, nearly tripling. In 2016, he says that he and his wife plan to grow the business at a more controlled pace of 10% over 2015.
Not all franchises are created equal so it’s crucial to do extensive due diligence in order to find the best senior care franchise for you. Only the senior services franchises with the most satisfied franchisees are featured on page 7 of this report (please see report above). Many make how their franchisees ranked them in crucial areas including training, support, leadership, marketing, and culture available at no cost within the Franchise Reviews section of this website.
When it comes to making the final decision regarding which franchise is best for you, it will come down to two factors: what you discovered during the due diligence process and your gut instinct. You will need to believe in the concept, have faith in the team that is driving it, and feel it will fulfill both your business and personal objectives.
When asked what he enjoys most about owning his franchise, Brightstar Care franchisee, Matthew Hayes responded, “From a business perspective, I appreciate being able to grow something from nothing while helping others. From a personal perspective, I enjoy working with our families and hearing the stories of their loved ones. There are some amazing people out there that I would not otherwise know if it were not for this experience.” Hayes purchased his franchise in Columbia, MO with his wife, Kristine, in 2014.
Hayes also shared how much he appreciates the support he receives from his franchisor and fellow franchisees. “Initially Brightstar provided a great start up team and a detailed plan to follow. Now, I appreciate their collaboration and efforts at extending and developing our brand into more than it is today. I learn the most from my fellow owners. The best thing I did in the beginning after being open for 12 weeks and realizing that something was kind of off was spend a week in one of the top 10 franchisee’s office. It was transformational and most appreciated. The help is there if you seek it out.”
AN INDUSTRY THAT WILL AGE GRACEFULLY
Senior care is consistently one of the top five franchise sectors when it comes to franchisee satisfaction according to Franchise Business Review’s annual research. In fact, 87% of the 1,809 franchisees we surveyed for this report agree or strongly agree they enjoy operating their business.
Of course with any fast-growing business sector, competition in this space will continue to increase. Franchisees will need to work extra hard to make their business stand out among others. Your chances of doing so increase dramatically if you ensure you have the right support team in place, focus on delivering exceptional care, and have chosen the right franchise brand.
“Ultimately do what you love. You will be successful,”says Homewatch CareGivers’ Sharma.
For a description of the pros and cons of running a senior care franchise see p. 4 of this report (please see report above).
Child Services Franchise Offerings Are Off the Growth Chart
The child services franchise sector is one of the fastest growing for multiple reasons. The first is that there are a lot of children in the United States. Of the 50.1 million students attending public elementary and secondary schools, 35.2 million will be in prekindergarten through grade eight and 14.9 million will be in grades nine through 12. This does not even account for the millions of students who attend private schools. Other factors driving the sector’s growth include research that supports the crucial role the first five years play in children’s long-term development, schools cutting physical education, art and music programs and extracurricular funding, and even the Obama administration’s focus on child obesity as an epidemic in our country.
The sector encompasses many different business models, including tutoring and education, sports and physical development, childcare, retail/resale stores, and niche services like photography and event hosting. Even within these detailed segments, there is greater variance. For example, sports development programs range from those that provide mobile services as part of school or community-based programming to those that offer an actual physical space in which instruction is offered.
Eileen Huntington, CEO of Huntington Learning Centers, weighs in regarding what she believes is contributing to the growth of the educational child services sector, “A big piece of this growth stems from the industry growth as a whole and our country’s focus on education—the tutoring industry is currently a $4.5B industry and projected to reach $7B by 2020 according to the Anything Research market report from 2016. Parents will go to great lengths for their children and when you can provide a great educational service, they find a way to prioritize it. On the business end, it’s a rewarding way to earn a living.” According to Huntington, the average Huntington Learning Centers’ franchisee has grown revenue 34% from 2009 to 2015.
When asked to explain what he thinks is driving the growth of franchises that get children physically active, Tom Bunchman, CEO of JumpBunch says, “The combination of kids spending more time in front of a TV or computer with the increasing number of schools cutting physical education from their budgets, has time-pressed parents seeking out ways to engage their children in physical activity. In addition, people are increasingly aware of the many health risks that accompany excessive weight among children.”
THE ROI OF INVESTING IN SERVING CHILDREN
The child services franchise sector offer franchisees an opportunity to earn an income, while building long-term relationships with families they serve and making a positive impact on their community as a whole and the next generation while, oftentimes, having fun.
“I have been a soccer player all my life, it is how I identified myself for many years. I went and watched a couple of Soccer Shots sessions before I purchased my franchise,” says Trey Alexander, who has owned a Soccer Shots franchise in Raleigh-Durham with his wife, Summer, since 2013. “Seeing that Soccer Shots took the soccer side of the program seriously was important to me, but what was most impressive was the way they took the game of soccer and transformed it into a way to invest in the children we serve.”
An array of child services franchise investment options for prospective franchisees exists as you can see from our list on page 6 of this report (please see report above). The investment can be as low as $16,300 for a TGA Premier Golf & Tennis franchise or as high as $185,000 for a KidsPark franchise, which makes hourly childcare available without reservations. It’s important to look at more than just the average investment since the return on your financial investment in a franchise is not necessarily tied to the initial amount spent. Some franchise models require a significant investment to secure a physical space for the business, dozens of employees, and lots of overhead, which eat into profits. While a small, easy to run home-based business, which many child services franchises are, might offer more from a profitability standpoint.
If you are looking for an extra source of income while you work partor full-time, rather than quit your job and commit 100% on day one, child services is one of the few franchise sectors that includes franchise models that enable you to do so. For example, JumpBunch and Soccer Shots offer mobile sports and fitness programs as part of a school or daycare’s existing curriculum, require a relatively small investment, and new franchisees are usually able to run the business part-time as they build up customers and capital.
Many child services concepts offer tremendous flexibility. Out of the 1,506 franchisees we surveyed for this report 50% said they work less than 40 hours a week in comparison to 30% of all other franchisees in all sectors we survey. 22% of franchisees in the child services segment said they work less than 30 hours vs. 13% of all the other segments we survey. In fact, 67% of child services franchisees responded they perceive their work/life balance as balanced.
“My work/personal life balance is better than ever,” says Sonja Brummer, who owns four Amazing Athletes franchises within San Diego County, CA, with her husband, Randy. “My days are not stress and work free by any means, but I have built an amazing team to take a lot of the workload off my mind and find ways to improve it. I can go on vacation now and attend my children’s activities, knowing that my business will still be running smoothly when I come back. I very rarely have to work late nights or weekends now. When I first bought my franchise, I was doing everything myself. I’d coach classes all day, and then in the evenings/weekends I’d have to do accounting tasks. When I hired my first coaches, it took some coaching off my hands, but it added more work by having to do payroll and manage them while I was also still teaching classes. I also still had to do the day-to-day work like printing flyers, stamp brochures, answer the phone and emails, substitute for other coaches, and other bigger business tasks like trying to grow the business while keeping it high quality.”
“I work about 30 to 40 hours a week now. It was probably more like 40 to 50 in the initial years as I was getting things going,” says Jilaine Anderson, who purchased her JumpBunch of Central Ohio franchise in October of 2008 and had it open and operating one month later. “I feel I have a good work life balance in terms of vacation, family, etc. Since I work from home, I am able to flex my schedule to attend to personal needs. I do occasionally have to work an evening or Saturday either teaching a JumpBunch class or attending an event at one of my locations.”
Another advantage to the child services segment is that the sector is fairly recession-resistant. Many child-based services remain in demand regardless of the state of the economy, particularly those which provide child care because as long as parents have jobs, they need help taking care of their children.
NOT ALL SUGAR AND SPICE AND EVERYTHING NICE
While the child services sector clearly offers many advantages, becoming wealthy, in many cases is not one of them. The average pre-tax income for franchisees at child care concepts that Franchise Business Review surveyed was $101,626 for education focused franchises, $47,828 for recreation focused franchises, and $63,395 for other child services franchise concepts (e.g. art classes). It’s important, however, to put these revenue figures in the context of the data above regarding the average work hours for a child services sector. With 50% of the franchisees we surveyed saying they work less than 40 hours a week—significantly less than the other sectors as a whole—it makes sense that their gross revenue is also lower. It’s interesting to note that income must not be the number one driving factor for most franchisees who elect to invest in a child services franchise since 65% of those surveyed say their financial expectations are being met.
“My 2015 gross revenue was $134,000 and I have projected $150,000 for 2016,” says Anderson of JumpBunch. “The company has a good profit margin as we don’t have any concerns about lease payments for a building.” The current minimum investment for a JumpBunch franchise is $40,300.
“We grossed over $385,000 in 2015 and project we’ll gross at least $415,000 in 2016,” says Brummer, who as stated earlier owns four Amazing Athletes locations. $34,150 is the current minimum investment for an Amazing Athlete’s franchise.
Although the total hours worked by many franchisees in the child services sector may be lower than that of other sectors, some franchise concepts necessitate working night and weekend hours, particularly sports and tutoring. Other child services investment opportunities such as preschools and daycares require ongoing, and often on-site management in order to manage staff and adhere to the regulations and licensing requirements childcare entails.
Perhaps more than any other franchise segment, besides senior care, the child services sector demands that franchisees hire quality staff. Any franchise that goes into schools or preschools or that is a preschool or daycare, must do their due diligence including background checks on potential employees.
Lastly, the child services sector is very competitive. Child services providers must compete for the attention of caregivers and children’s time. This is particularly true regarding the after-school space, since children have limited after-school hours and an array of extracurricular activities to choose from.
A BRIGHT FUTURE
For many franchisees, the positives of owning a child services franchise far outweigh the negatives as indicated by 90% of the franchisees we surveyed stating they agree or strongly agree they enjoy operating their business. Caregivers of children will always seek out things that stimulate and educate them, which makes the child services sector a fairly evergreen one. The most successful franchisees in the sector work diligently to maintain positive relationships with schools, community programs, and unrelated child-based businesses in their area in order to generate referrals.
The array of business models and investment levels that exist for child services franchises make it possible to choose one that best matches your interests, strengths, and time availability. To determine these factors, start with yourself. In addition to bettering the lives of children, what are your passions? Do you have experience in art, cooking, a sport, or something else? Once you have these answers, look for child services franchises that best fit them and compare the brands side-by-side. A good place to start is page 6 of this report (please see the report above), which features child services franchises with the most satisfied franchisees. Many also share how their franchisees ranked them in crucial areas including training, support, leadership, marketing, and culture available at no cost within the Franchise Reviews section of www. FranchiseBusinessReview.com.
“When you are exploring the business and what it takes to be successful, truly think if you can really see yourself doing this. Talk to as many people in the system as will talk with you. Ask them what questions you should be asking and what challenges they face. Then, if at all possible, go and find out about those challenges before you sign,” says Alexander of Soccer Shots.
Brummer of Amazing Athletes instinctively followed Alexander’s advice, “I was always an athlete and was raised in a world of sports. I have also always wanted to work with children. So having the two things I loved combined sounded like the perfect career choice for me.” Brummer had the advantage of having worked for Amazing Athletes as a coach while attending college to become an elementary school teacher. Upon receiving her Liberal Studies degree, the California state budget cuts begun hitting the school districts so the time seemed ripe to buy an Amazing Athletes franchise instead of completing her credentials program.
You’ll want to be sure you get the support you need from the franchisor in order to be successful.
“I appreciated The Goddard School’s turnkey guidance with the entire start-up process,” says Jason Pullukat, owner of The Goddard School in Chicago (Lincoln Park), IL, which he opened in 2011. “Everything was laid out very clearly with steps and resources. I was provided with guidance on every aspect of the school, from opening to enrollment, to marketing and public relations, to communicating with family and staff and much more. Additionally, I have a dedicated support system that is always available to me if I have any questions.”
All of the franchisees we spoke to for this report are truly committed to positively impacting children’s lives. In addition, the joy they derive from doing so is apparent.
“I love the business. I love that we are enhancing the development of children and helping them develop a love for sports and fitness that will hopefully continue into adult-hood. I love to hear that a child is excited to go to school so they can be part of the team that day. I love hearing from a parent how a child starting eating broccoli because their coach encouraged it. I love how we feel like celebrities when we go into the schools because the children are so excited to see us. I love how rewarding it is and how the giant smiles on the children’s faces prove it,” says Brummer of Amazing Athletes.
If your clients don’t have giant smiles on their faces every day and your job doesn’t make you feel like you are positively impacting people’s lives, perhaps a career in child services is for you.
Ready to Be Your Own Boss?
Your success in franchising will be dependent on your personal ability as well as the quality of the franchise you select. To find out if a franchise is likely to deliver on your business and personal goals, speak with franchisees within the system and look at the company’s franchisee satisfaction and performance data. You’ll learn how they perform in crucial areas including training, support, leadership, marketing, and culture. All the franchises featured in this report were ranked highly by their franchisees. You can access reviews and ratings, as well as many other resources for franchise investors at FranchiseBusinessReview.com.
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