Pinpointing trends from the trajectories of three emerging senior service franchises.
Today’s landscape of franchisors in senior services is both diverse and well-established. The entrepreneur.com ranking includes over 60 senior franchises, and the IFA website identifies more than 45 franchisor members in the category of senior services. Most of these brands emerged in the last couple of decades, and the sector is constantly evolving as the “silver tsunami” of Boomers progresses.
While senior services have always been around, the competitive landscape of franchised senior services emerged in the 1990s with a handful of U.S. franchisors, like Griswold Home Care, Right at Home, Home Instead, Visiting Angels and Comfort Keepers. One of these early franchisor founders was Right at Home’s Allen Hager. “When we launched Right at Home in 1995, we understood the potential for growth of senior care franchises,” says Hager. “However, in 2021, I look at the competitive environment, and I’m amazed at the growth and evolution of franchised senior services.”
So what’s the future of this segment, and what new trends are emerging?
To take a closer look at the evolution and the future of franchised senior services, this article profiles three emerging franchisors in the senior services category. Why emerging franchisors? Emerging franchisors, by their nature, are constantly evolving as they grow. With newer, more nimble business models, emerging franchisors are natural laboratories to test new ideas and to address new market challenges.
“Based on our U.S. success through 2020, we’re now actively planning expansion into multiple international markets”
While the definition of ‘emerging franchisors’ may vary, for the purposes of these case studies we identified senior services franchisors that (1) began franchising in the last 10 years and (2) have fewer than 100 units. We also diversified our case studies to include three franchisors in different senior service niches.
The interviews of the companies focused on three areas:
• The history and evolution of the franchise
• Their specific niche and differentiation among senior service franchises
• The impact and lessons learned during the COVID-19 crisis
Interestingly, we found that the three concepts had some similar storylines, which point to key trends in senior services.
CASE STUDY #1: SENIOR CARE AUTHORITY
Founded by Frank Samson in 2009, Petaluma, California-based Senior Care Authority is an elder care consulting franchise that specializes in senior living placement. They help families to find assisted living, memory care and other care solutions for their elderly loved ones.
Prior to Senior Care Authority, Samson’s background was in the travel industry, having built and sold a 200-unit travel agency franchise in the late 1990s. In the early 2000s, Samson experienced the challenge of finding care for his elderly parents, who passed away seven weeks apart. This opened his eyes to the need for senior care solutions. After a couple of years of researching the sector, he identified an opportunity in the senior living placement niche, and he launched Senior Care Authority’s first location. Samson operated the business and tested the model for five years. In 2014, Senior Care Authority began franchising, and today the franchise has 72 units open nationwide.
During his early years testing the model, Samson realized the vital and integral role that elder care consulting played in the business. Samson notes: “The company was founded on the service of senior living placement, however, I learned that consulting with families in senior care – coupled with placement – was a valued combination.”
Samson addressed this opportunity by developing Care Authority programs and packages around consulting services. For example, they offer “Peace of Mind Visits’’ after placement to check-in on elderly clients and advise long-distance family members of updates. Other services include healthcare troubleshooting and advocacy, as well as Medicaid and Veteran’s Program guidance. An elderly driver self-assessment program was recently launched to help families address safety issues of their elderly loved ones behind the wheel.
In the first couple months of the COVID-19 lockdowns, Senior Care Authority revenues declined. “Families were confused and concerned about what to do about their elderly loved ones,” comments Samson, “so we offered one free hour of consulting to help families explore options and find the best solutions.” In short order, business began to turn around, and by the end of 2020 Senior Care Authority revenues were up significantly year-over-year, despite nationwide sales declines in the assisted living sector.
“In 2020 our franchisees reached the highest systemwide sales in our history, and there’s no doubt that our elder care consulting played a key role in that achievement,” says Samson. “Based on our U.S. success through 2020, we’re now actively planning expansion into multiple international markets.”
CASE STUDY #2: QUALICARE
Toronto-based Qualicare was founded in 2001 by Wayne and Andrea Nathanson. Previously, the couple cared for Wayne’s father, who battled Amyotrophic Lateral Sclerosis (ALS), which required the complex coordination of over 40 care and health practitioners. Their experience made the couple realize how they could help other families in similar situations, so they decided to start up Qualicare.
In 2011 Qualicare was acquired by Clear Summit Group (CSG), a franchise equity group that invests in and develops franchise companies, and Qualicare began franchising that same year. As of February 2021, Qualicare has 70 units (50 in Canada and 20 in the U.S.).
Nathan Weber is the VP of business development for Qualicare, who works with the CSG parent group. According to Weber: “In the years prior to acquiring Qualicare, CSG carefully researched many franchise concepts. Qualicare stood out because of its unique positioning and business model within the senior care sector.”
In particular, Weber notes that Qualicare started out as an advanced case management company, focused on helping families to plan and navigate complex care solutions for their loved ones. Over several years, Qualicare’s services evolved to include a range of medical, non-medical, and concierge in-home care services. Presently, Qualicare’s revenue mix includes non-medical care, medical care and consulting revenue. As such, Qualicare has a significantly more balanced service mix, compared to most home care franchises, which depend heavily on non-medical care revenues. Qualicare’s revenue mix played an important role during the 2020 crisis.
With the outbreak of COVID-19 in early 2020, Qualicare saw an initial dip in revenues, but that soon changed. “At first, our non-medical revenues slowed, but then our medical services exploded,” explains Weber. “During the COVID lockdown many of our non-medical services were put on hold by our clients, for example, non-essential caregiver activities and companion care. However, our in-home medical services were typically deemed essential services, and during COVID lockdowns, many clients were unable or unwilling to go to a doctor’s office or other medical facility.”
The boost to Qualicare’s medical revenues far outpaced their non-medical revenue losses, resulting in year-over-year revenue growth for their franchise system during 2020. On top of that, Qualicare saw an uptick in new franchise candidate inquiries, and by September, the company had surpassed its annual franchise development goals.
CASE STUDY #3: CHEFS FOR SENIORS
Based in Madison, Wisconsin, Chefs For Seniors was founded in 2013 by Barrett Allman, an executive chef and restaurant owner with over 25 years of foodservice experience. Barrett and his son Nathan Allman spent the first year preparing meals in the local Madison market, learning about the needs of their senior clients, and fine-tuning the business model. They eventually brought on more chefs and expanded into other states, and Chefs For Seniors began franchising the business in 2017. Today it has 53 franchised units throughout the U.S.
The motto of Chefs For Seniors is: ‘Improve seniors’ lives through food’. The brand realized that many seniors wish to stay in their own homes, but they often struggle to cook meals for themselves. The chefs typically visit their clients’ homes once a week to cook prepare meals for the entire week.
The nutritional health of its elderly clients is a central goal of Chefs For Seniors. The chefs handle the food shopping and carefully customize their meals to accommodate dietary restrictions. They often consult with healthcare professionals and dieticians and incorporate more healthy ingredient options. Chefs For Seniors also offers “nutrition safety checks” with families to address their concerns about what their elderly loved ones are – or are not – eating.
According to Nathan Allman, COO and co-founder of Chefs For Seniors: “Since our early days, we’ve purposely built our business with a ‘non-profit feel’. In the selection of our franchise owners, we look for people who have the heart to share our mission of providing seniors with amazing meals and proper nutrition.”
“When COVID hit, we quickly adapted our services to meet health protocols, such as using PPE and strict social distancing. However, the COVID crisis did significantly impact our core business model,” explains Allman. “COVID did cause an initial dip in revenues during the early months, but then the business bounced back. In particular, our older clients in their 80s stuck with our service, since many considered our meal preparation as an essential service.”
In the fourth quarter of 2020, Chefs For Seniors saw its highest systemwide revenue to-date, and with the vaccine roll-out, clients who previously paused their services are now returning. The brand also has a bright franchise development outlook, with three new franchisees in January 2021 and a target of 25 new franchise locations by year-end.
So does this spell doom for established non-medical home care franchises? Absolutely not. It’s a simple fact of Boomer demographics. The silver tsunami will ensure that the demand for all types of senior care and senior services will continue to grow for decades.
FOUR KEY TRENDS IN SENIOR SERVICE FRANCHISES
1. Consulting and case management: In the case of all three concepts, various advisory services play an integral role in their service mix, including elder care consulting and case management (for Senior Care Authority and Qualicare) and dietary guidance (in the case of Chefs For Seniors).
2. Higher acuity of care: In the early 2000s non-medical home care represented the overwhelming majority of franchised senior services. As Boomers age, we’ve seen an increase in medical conditions that require more complex care solutions, case management and oversight.
3. Regulatory complexity: Higher acuity healthcare services generally have more complex healthcare regulatory compliance and licensing requirements, which may vary by location.
4. Boom of essential services: During COVID lockdowns, non-essential services revenues declined. However, by late 2020 the boom in essential services typically offset early losses. Going forward, senior sector franchises will likely take a closer look at their service mix, with an eye towards increasing essential services.
THE AUTHOR
Ray Hays has served as an executive or advisor to five senior services franchisors. He is the managing partner at FranLaunch USA, a franchise management firm that provides management resources and capital solutions to emerging franchisors and international concepts entering the U.S. market. Ray has a 30-year track record and field experience in over 50 countries worldwide.
