The home care industry is big news right now with the aging of Baby Boomers and the industry-wide growth. One would think that having a home care business is a surefire way to success. But unfortunately, home care businesses fold every day. Why does this happen?
There are several reasons why home care businesses go out of business, and we’ve attempted to summarize the three most critical elements that cause a home care company to die on the vine.
1. Not Having Enough Starting Capital.
Many people go into business thinking that they can start with no money in the bank. A service business like home care doesn’t require many assets or equipment to buy when starting. However, you should have sufficient funds to float your living expenses, potentially hire a caregiver, and create some marketing collateral.
It’s generally recommended that you have $40,000 – $80,000 to start a private duty home care business, and $80,000 to $150,000 to start a Medicare-certified home health business. If you aren’t at those levels, consider saving for longer before venturing out on your own.
2. Not Controlling the Customer Service Experience.
Being that you are not selling any products, but providing a service, your level of customer service is the ‘quality of your product’. From the minute someone calls or fills out an online form, they are beginning their customer service experience with your company.
As service begins, the caregivers are the face of the business and holders of 90% of the customer service experience. You want to hire caregivers that are pleasant and have a servant mentality. There is an old saying in hiring that says to “hire for attitude, not skill.” Skills can be taught, but generally an attitude of someone does not change. Make sure that they can deliver on your customer service promise.
3. NOT Getting Out of the Office or the Field as a Caregiver.
Wait! What? Yes, get out of the office at least once a week. Far too many home care agency owners spend all their time either as a caregiver or doing paperwork and administrative tasks. But you got into business to have, sustain and grow a business. You need to get out there are grow it.
You need to spend time (perhaps a whole day each week) out marketing your business in person. Go to rehabilitation centers, doctors’ offices, senior centers, or wherever you think you would find a referral or lead. Build relationships and make sure that you are delivering on your promise.
By avoiding these 3 killers, your chances of success will be very high. Remember to give yourself time as it takes a while to build up a steady stream of clients. Success is possible in this industry if you follow the strategies to success. Until next time, good luck!
CareTime provides home care software that includes agency management, billing software and a fully compliant EVV system. For more information see www.caretime.us.
Want to Learn More? Watch a video on how CareTime home care software works for home care: