Every day, 10,000 Americans turn 65, according to RetireFearless. While many are seniors able to remain independent and active for a number of years, others require the type of compassionate care and support offered by senior care and assisted living facilities.
If you’re thinking about starting an assisted living franchise of your own, you probably have some questions. Fortunately for you, we have some answers! In this article we’re going to take a look at some of the ins and outs of starting a senior services franchise—including whether senior care and assisted living franchises make a good investment, what certifications you might need, and more.
Are Assisted Living Facilities a Good Investment?
Yes! Due to the increasing demand for—and profitability of—assisted living facilities, they represent a solid investment opportunity. Let’s take a closer look at each of the key considerations, starting with the current demand for assisted living options.
Is There a Demand for Assisted Living Facilities?
Yes, and for good reason: simply put, our nation’s population is getting older. In 2020, people aged 65 and older made up 16.9% of America’s population, according to Statista. The same research projects this subset of the population to grow to 20.6% by 2030.
What’s more, in response to the steady increase in the senior population, IBISWorld found that the number of senior care and assisted living facilities has increased by an average of 5.1% per year between 2018 and 2023. This not only indicates a persisted demand, but suggests a continuing demand as well.
What Is the Best State to Start an Assisted Living Facility?
There are a few different ways to define the “best” state to start an assisted living facility in, with the most objective being the expected increase of seniors within a given state. According to that measure, the top 5 states are, according to the Residential Assisted Living National Association (RALNA):
1. The Silver State (Nevada), 125% increase
2. The Last Frontier (Alaska), 117% increase
3. The Grand Canyon State (Arizona), 95% increase
4. The Peach State (Georgia), 85% increase
5. The Gem State (Idaho) and Palmetto State (South Carolina), 82% increase (tie)
How Much Do Assisted Living Facilities Make?
Like virtually any business, an assisted living facility’s profitability depends on a number of factors, such as their size, location, and services provided. That being said, RetireFearless estimates that “An assisted living facility the size of a single-family house can generate a gross profit of $36,000 and $10,000 in cash flow per month.” Impressive!
For comparison’s sake, the average franchise owner (across various industries) might make anywhere from $80,000 to $120,000 in annual salary, depending on the state, according to ZipRecruiter.
What Certifications Are Required for Home Care Franchises?
As noted by Assisted Living Directory, assisted living facility regulations vary by state, making due diligence an important step before entering the industry. For starters, we recommend that you consult resources compiled by the American Health Care Association and National Center for Assisted Living (AHCA/NCAL) as an initial step. There, you can view in-depth resources specific to each state and related to topics such as state licensing agencies, assisted living regulations, Medicaid information, and more.
These resources are also updated regularly, in order to account for any new rules for assisted living facilities, which nearly two-thirds of states put in place between 2020 and 2022.
As a franchisee, the better you understand the senior care industry, the better positioned you’ll be to improve residents’ quality of life (while also running a profitable business, of course). To set yourself up for success, you might consider the following:
- General Caregiver Certification: While this certification is not required of a franchisee, it can offer an invaluable education—not only around the ins and outs of the senior care industry, but also how to make more informed and effective decisions around things like staffing.
- Business Management Coursework: As a franchisee, you’ll need to staff your facility and make important business and management decisions on a regular basis. If you’ve never been a boss or manager before—or you aren’t too confident in your overall business acumen—a refresher course might be a good idea. You can find plenty of free courses online, including a vast library provided by Coursera—most of which are free to audit.
- Franchisee Training: One underrated benefit of franchising is the industry-specific training and support you should receive from the franchisor. Since your success is ultimately their success (and vice versa), it’s important that the franchisee and franchisor are on the same page. Before you sign your franchise agreement, make sure to inquire about what franchisee training will look like, as well as how you’ll be supported by the franchisor throughout the process.
What Is the Best Home Care Franchise to Invest In?
Many of the nation’s top senior care franchises are available today as franchising opportunities, and the five highest-rated senior care franchises according to Franchise Business Review can all be found on Franchise.com by clicking the links below:
Still Unsure Whether Franchising Is Right for You?
Franchise.com is the online home of several helpful resources and tools for prospective franchise owners. In addition to a wide range of opportunities within the senior services industry (and many others), you can also find Franchising FAQs, information about franchise financing, and so much more. Find your opportunity today!
