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Owning a Home Care Franchise vs. Other Industries
February 12, 2021
Imagine being your own boss while operating a successful business, making a positive impact on the world and being part of a growing industry that shows no signs of slowing down. To some aspiring entrepreneurs, this is the appeal of investing in a home care franchise. Best of all, you don’t need decades of experience or trial and error to reach this goal.
Owning a home care franchise has many benefits, such as low startup costs and the chance to make a difference. You may be wondering if home care is right for you, especially since there are many other franchise options to consider. In this post, we’ll compare the home care industry to different types of franchises so you can find the right fit.
What Is Home Care?
First, it’s critical to know what home care entails. According to a report created by the Home Care Association of America and the Global Coalition on Aging, home care is a relatively new industry. It was designed to help meet the needs of a growing senior population. As the report states, there will be nearly 84 million older adults in the United States by 2050. The majority of these individuals will need assistance with daily living activities at some point, and most of them will want to stay at home as long as they can.
Home care makes this possible. Home care professionals help older adults remain independent in the comfort of their own homes. They provide services such as helping clients bathe, dress, prepare meals, eat, run errands and do light housework. Home care professionals also provide companionship and keep clients connected to the community, helping them avoid social isolation. Home care professionals do not perform medical services or need training in health care.
What Is a Home Care Franchise?
A home care franchise helps franchisees enter the industry and launch their business under an established name. By buying a home care franchise, you get to collaborate with professionals who already understand the relevant rules and regulations. Unlike starting a home care business on your own, you’ll receive guidance and training to quickly get your business up and running when you buy a franchise.
Home Care vs. Other Franchises
In general, franchises allow people to invest in an existing successful brand and business model. When someone buys a franchise, they purchase the right to do business under the franchisor’s name and sell their goods or services. In other words, they become part of an established company and get all the training they need to launch their business smoothly.
Owning a franchise also provides access to marketing tools and ongoing support. As a franchisee, you won’t have to create a strategy for customer acquisition or develop a brand. Instead, you can focus on running your business and making it grow.
These perks are available in exchange for an initial investment and royalty payments. Some franchisors charge additional fees, such as advertising fees. Overall, owning a franchise can be highly profitable, and you may be able to generate revenue much faster than if you started a business from scratch.
Although buying a franchise can be a great alternative to starting a business on your own, you still need to select a franchise that aligns with your goals and vision. If you have a knack for business and want to make a difference, the home care industry may be calling you.
What makes home care one of the best types of franchises? Here’s how it compares to other industries:
1. Home Care vs. Cleaning Franchise
Commercial and residential cleaning companies serve a range of industries. These companies may clean office buildings, medical facilities, warehouses, schools, hospitals, restaurants and homes. According to IBISWorld, the janitorial services industry has grown at an average annual rate of 2.1% from 2015 to 2020. The market size is currently $64 billion.
Though the cleaning industry has experienced growth over the past few years, demand is currently declining. Today, more people are working and studying at home, reducing the need for commercial cleaning services. In the current economic climate, homeowners may be less willing to pay for cleaning services.
The home care providers industry grew at an average annual rate of 2.2% from 2015 to 2020. Its market size is much larger than the cleaning industry at $97 billion. It’s also considered one of the fastest-growing health care industries in the country and will continue to expand as the population ages.
Neither the cleaning nor home care industry requires special skills or prior experience. You should consider what each job entails. As a cleaning franchise owner, you won’t have much variety regarding the services you offer. You’ll also be competing against over a million janitorial service businesses. With home care, you’ll be competing against fewer than 500,000.
Lastly, consider the impact of your business and whether it will be rewarding. Buying a franchise requires time and money, so it’s worth choosing an industry that’s meaningful to you. Although cleaning is important, consider if you want to work with people directly. If so, you may find home care more fulfilling.
2. Home Care vs. Gym Franchise
If you’ve always dreamed of owning a gym and helping people get fit, you might be thinking about buying a gym franchise. However, even if you have a passion for health and fitness, you’ll want to pause before investing in a gym franchise.
Presently, the gym and fitness franchise industry is not looking as bright. As IBISWorld reports, the industry is currently declining, and many establishments had to close their doors. The market size is significantly smaller than the home care industry, at $3 billion. Although experts predict the gym and fitness industry will grow in the future, you’ll want to consider if it’s worth the risk.
Home care isn’t as strongly impacted by the economy or other external factors. For many older adults and their families, home care is necessary no matter what’s going on in the world.
There are other critical aspects to consider if you’re thinking about buying a gym franchise. First, some gym franchises require a substantial investment. For example, you’ll need to invest an estimated $2 million to $5 million to buy and operate a Gold’s Gym. A home care franchise costs a portion of that amount. At HomeWell Care Services, for instance, the average upfront investment ranges from $96,400 to $221,800.*
Why does it cost so much to own a gym franchise? Depending on the company, you may need to rent a massive space to hold all the equipment and amenities. You also need to fill the facility with specific equipment and ensure the space has locker rooms, space for workout classes, and maybe a pool or basketball court. You’ll also need to pay the bills to operate your facility. Regardless of the costs, a gym franchisor will want you to be consistent with their brand and offer services their customers expect. Therefore, you’ll need to make sure your facility is up to par and your employees are trained accordingly.
A home care business involves much lower entry and overhead costs. You won’t need to rent thousands of square feet or fill the space with expensive equipment. Since your staff will provide services to clients in their homes, you won’t have the expenses associated with a large brick-and-mortar business.
3. Home Care vs. Health Care Franchise
Deciding whether to buy a home care franchise or a health care franchise looks tricky at first glance. Both involve providing care and compassion to other people. If you’ve always wanted to help people and also want to make a profit, it’s understandable if you feel drawn to both options.
However, there’s a big difference between home care and health care franchises, which you’ll want to consider carefully. Health care franchises may include eye care, urgent care centers and hospice services. These businesses require licensed medical staff, such as nurses and physicians, to deliver services to patients. To start a health care franchise, it’s recommended to be comfortable with the medical industry first.
As mentioned earlier, you do not need a medical background to be successful in home care. Home care does not involve medical services, like changing wound dressings or drawing blood. Instead, home care employees focus on assisting their clients with daily living activities. The goal of home care is to help clients live safely and independently in their homes and provide companionship.
If you’re worried you don’t have the skills to own a home care franchise, know you won’t enter the industry blindly. Your franchisor will give you the training you need to excel as a home care franchisee. For example, at HomeWell, we offer step-by-step support, industry education and ongoing training. Our approach enables you and your staff to put your passion for helping others to work without a medical degree.
Health care franchises may also involve much higher startup costs than home care businesses. For example, an urgent care franchise might require an initial investment of over a million dollars. With an urgent care franchise, you’ll need to buy or rent a large space so you can have a waiting room, triage area, exam rooms, restrooms and offices. The American Academy of Urgent Care Medicine recommends 3,000 square feet for an urgent care center. You’ll also need to purchase expensive equipment and employ licensed medical staff to get started. With a home care franchise, your startup and overhead costs will be much lower.
4. Home Care vs. Restaurant Franchise
A restaurant franchise may include fast-food restaurants, cafes or full-service establishments. Restaurant franchises offer instant brand recognition, which seems like an attractive feature. However, that doesn’t mean a restaurant franchisee will make a substantial profit.
Owning a restaurant comes with many risks, even if you operate under a well-known name. Any restaurant can be affected by changes in the economy, consumers’ tastes, trends and currency fluctuations. Home care franchises are less affected by external factors like trends. For many older adults, being able to live safely in their homes is a priority, and they are willing to pay for home care services no matter what.
Restaurants also need a great location to be successful. Location is the primary reason around 60% of new restaurants fail. With a home care franchise, you travel to your client’s homes within a given territory. You don’t need to worry about opening your business in a high-traffic location or paying for a property in a highly desirable area.
Perhaps one of the biggest deterrents to owning a restaurant franchise is cost. Many restaurant franchises require an initial investment of hundreds of thousands of dollars. Some require over a million dollars to get started. For example, to become a Kentucky Fried Chicken franchisee, you need a total net worth of $1.5 million. You’ll need about $1 million to $2 million to open a McDonald’s. You’ll also need to cover a long list of costs to operate a restaurant franchise. You’ll need to pay for rent, utilities, kitchen equipment, product inventory and many other expenses related to managing a brick-and-mortar establishment.
The restaurant industry is highly competitive. As a restaurant franchise owner, you may be competing against hundreds, maybe even thousands of other restaurants in your area — including your own brand. Although home care isn’t without competition, it is an in-demand industry that’s expected to continue growing.
Overall, owning a restaurant is risky business. If you want to make a more sound investment, a home care franchise is an excellent option.
What Type of Franchise Should I Open?
Still not sure what type of franchise to open? Buying a franchise is a big decision, so it’s worth carefully considering your options. Here are some tips to help you find the right match:
- Consider your interests: What are your passions? What type of business appeals to you most? Aim to choose a franchise that energizes you and will make you feel fulfilled.
- Do plenty of research: Once you know what direction you want to pursue, make sure to research your options. Your research will paint a clearer picture of what to expect and help you narrow your options further.
- Contact franchisors: Get in touch with your top choices and ask questions. Once you have a better understanding of their businesses, you’ll have an easier time deciding which franchise to buy.
- Consider your investment budget: No matter how much you love a franchise concept, you need to consider if it makes financial sense for you. Make sure the franchise suits your financial situation and is a good fit for your geographic area.
- Avoid fads: In general, it’s best to avoid fads when buying a franchise. Instead, focus on businesses that will enable long-term growth and success.
Learn More About Opening a Home Care Franchise
If you’re ready to invest in a profitable, recession-proof franchise that allows you to help others and contribute to your community, home care may be right for you. At HomeWell Care Services, we can help you start your franchise journey with confidence.
HomeWell Care Services is one of the leading home care providers in the nation. We’re committed to helping our franchisees succeed, so they can make a difference and grow their business at the same time. To learn more about HomeWell as an investment opportunity, download our easy-to-read Franchise Kit or contact us today.
*HomeWell Franchise Disclosure Document (FDD): Item 7 Estimated Initial Investment