Care home business thoughts?

[esco]

I'm a property investor and acquired funds of circa 300k.

I was looking at potentially getting into the care home business, and hiring a competent manager to run for me, as I definitely want to make sure the patients are looked after!

I've seen a few care homes online at about £1million with net profits advertised at about £100k. This seems very high. Is this normal returns in this industry?

I was just wondering if anyone has experience of this as I'm trying to learn more about this industry.

What are the main things I need to know?

 

[john1989]

My uncle has a medium sized care home and is struggling to stay open.

There are a lot of pressures on this industry and the living wage and auto enrolment do not help.

If I had £300k, I would take a nice long holiday and think of something else to invest in!

 

[billmccallum1957]

If you already know the property market and have £300K in liquid capital, it would probably make more sense to do what you're already doing. Or take on new build on a small scale.

 

[Dan Muddle]

If you can get a Manager that is passionate about the industry and also manage to get caring staff then you'll do great!

But that's tough and if not you might struggle to stay open without investing your own time into the care home.

 

[ethical PR]

If you can get a Manager that is passionate about the industry and also manage to get caring staff then you'll do great!

But that's tough and if not you might struggle to stay open without investing your own time into the care home.

No you won't.... It doesn't matter how good your staff are, if you don't have the right structure, the right investment and training, meet all the regulations that govern the sector and have carried out your market research to identify a gap in the market it is unlikely to be successful.

It is notoriously difficult to make money in the care home sector, even for those with experience.

 

[AG Consult]

Care homes used to be very lucrative years ago (Duncan Bannatyne for example) but times have changed massively.

Staff is the biggest issue. You will struggle to find decent staff to employ direct and be forced to go down the route of an agency who charge ridiculous amounts per hour for their cut.

You also have the Care Quality Commission (CQC) who are all over care homes these days with rigorous audits and reviews on a regular basis.

Then of course there is the competition. With the amount of care homes these days you need to stay very competitive on price whilst offering a top quality and unique service which stands out from your competition. Not easy!

With 300k and your experience as a property investor, I would just stick to that. It's not a case of just getting a decent manager to run a care home and off you go.

 

[NewGardenStyle]

Care homes used to be very lucrative years ago (Duncan Bannatyne for example) but times have changed massively.

This is very true. My family used to have a care home and it was very lucrative in the 80's and 90's. Luckily it was sold at the top of the market. It's much harder nowadays.

 

[Dan Muddle]

No you won't.... It doesn't matter how good your staff are, if you don't have the right structure, the right investment and training, meet all the regulations that govern the sector and have carried out your market research to identify a gap in the market it is unlikely to be successful.

It is notoriously difficult to make money in the care home sector, even for those with experience.

Staff are essential to the success of your business and without them you're likely to fail! And I'm a strong believer of this.

Obviously there are all the above factors as well and I wasn't saying it was just staff that determine the success of your business.

 

[Betelgeuse]

Something I did consider and looked into however it was not my forte therefore kept away from it.

How about in home care? Thought about that?

With 300k to invest? Feel free to get in touch with my business before I finish the rounds with Angels Den.

 

[ethical PR]

Staff are essential to the success of your business and without them you're likely to fail! And I'm a strong believer of this.

Obviously there are all the above factors as well and I wasn't saying it was just staff that determine the success of your business.

Of course good staff are one of the factors for a successful business. However your original post said

'If you can get a Manager that is passionate about the industry and also manage to get caring staff then you'll do great!'

You didn't mention good staff as being one of a number of factors that make up a successful business. My response was in that context.