Business Overview

This profitable, established company’s mission is to enhance the lives of aging adults and their families by offering an individualized approach to keep seniors safe and sound at home, instead of anywhere else. This is accomplished through a combination of skilled and compassionate caregivers and professional support staff. The company provides part-time and full-time non-medical services including dementia care and personal care services for the elderly who require assistance, supervision, light housework, and companionship to remain in their homes.

Potential ROI (Example Only):
ASSUMPTIONS OF POSSIBLE ACQUISITION STRUCTURE – 10% Down Payment, 90% 10-year SBA Loan @ 5.5%, and $65K Working Capital funded through LOC as part of the SBA Loan.

***Debt Services for SBA Loan and LOC = $55K/year***

ROI (Cash on cash) CALCULATION
$114K (SDE) – $55K (Debt Services) = $59K (Take home after debt)
132%+ ROI

ROI (Total equity) CALCULATION
$59K + $30K (The principle portion of Debt Services) = $89K (Equity earned from cash flow after debt services and including the principal portion of the debt services)
201%+ ROI

Financial

  • Asking Price: $440,000
  • Cash Flow: $114,000
  • Gross Revenue: $1,800,000
  • EBITDA: $114,000
  • FF&E: $112,000
  • Inventory: N/A
  • Inventory Included: N/A
  • Established: 2000

Detailed Information

  • Property Owned or Leased:Own
  • Property Included:N/A
  • Building Square Footage:3,256
  • Lot Size:N/A
  • Total Number of Employees:80
  • Furniture, Fixtures and Equipment:N/A
About The Facility:

Great office space with cubicles, private offices, meeting rooms, training rooms and community area.

Is Support & Training Included:

Franchisor will provide new owner training and the seller will provide transition support

Purpose For Selling:

Owner is ready to retire

Pros and Cons:

The In-Home Senior Care Franchises industry is benefiting from a growing number of aging baby boomers. Over the five years to 2019, the number of adults older than 65 grew 3.6% to 55.0 million people. As people live longer due to advancements in medicine and technology, a growing number of seniors are looking to stay in their own homes and maintain independence for as long as possible. Franchise establishments that provide medical and non-medical in-home services enable seniors to do just that. The high cost of nursing homes and assisted living accommodations, coupled with the escalating healthcare costs associated with hospital stays, has also continued to drive growth in demand for industry services. The Patient Protection and Affordable Care Act (PPACA) of 2010 includes a list of changes to nursing services for seniors and the disabled, among them encouraging the transition from nursing home services to at-home managed care. As a result, industry revenue grew at an annualized rate of 8.0% to $10.9 billion over the five years to 2019, including an increase of 6.8% in 2019 alone. Average profit margins were 15.4% of revenue in 2019. The franchise model has gained traction to capture the business of assisting senior citizens who want to remain in their homes. There are now more than 60 brands selling home healthcare franchises, which entice franchisees with moderate initial investment requirements and strong business support in key areas such as marketing and advertising. Instead of having to build reputations from the ground up as non-franchise businesses do, franchise owners benefit from the clout and name recognition of strong national brands. The number of enterprises grew at an annualized rate of 10.8% to 9,726 companies over the five years to 2019. Although industry growth slowed slightly during the economic downturn, in-home senior care franchising has remained strong. This growth is expected to accelerate over the next five years, with demographic changes expected to continue unabated. Over the five years to 2024, the number of adults aged 65 and older is expected to grow to 63.4 million people, accelerating industry growth. Additionally, solidification of changes implemented under the PPACA will shift demand toward at-home care, and an improving economy will better enable seniors to pay for non-medical services. Over the next five years, revenue is forecast to grow at an annualized rate of 6.4% to $15.0 billion.

Opportunities and Growth:

The Franchisor expansion into home based medical care will increase revenue potential. Hospitals now have a financial incentive to reduce readmission and will encourage patients to receive care from agencies such as this company. The incredible Baby Boomer/age wave phenomenon coming makes it likely that Medicare will include Home Care payments as a benefit to prevent hospitalization, a new source of revenue. Expected expansion of the scope of care will include medication administration, glucose monitoring and oxygen management and greatly enhance the ability to care for more seniors. Continuing to build and establish relationships with local referral providers will ensure a continued solid client base. The location is experiencing growth in population and commerce which in turn enhances the growth of this market.

Established Franchise:

This Business Is An Established Franchise

Additional Info

The company was established in 2000, making the business 22 years old.

The company has 80 employees and is located in a building with disclosed square footage of 3,256 sq ft.

Why is the Current Owner Selling The Business?

There are all sorts of reasons individuals resolve to sell operating businesses. Nevertheless, the real factor vs the one they tell you may be 2 completely different things. As an example, they might state "I have way too many other responsibilities" or "I am retiring". For numerous sellers, these factors stand. But also, for some, these may simply be reasons to attempt to conceal the reality of transforming demographics, increased competition, recent decrease in earnings, or an array of other reasons. This is why it is really essential that you not rely absolutely on a seller's word, yet instead, make use of the vendor's answer in conjunction with your overall due diligence. This will paint a much more practical picture of the business's current situation.

Existing Debts and Future Obligations

If the existing business is in debt, which many businesses are, then you will need to consider this when valuating/preparing your offer. Numerous operating businesses borrow money with the purpose of covering points such as supplies, payroll, accounts payable, so on and so forth. Keep in mind that in some cases this can indicate that profit margins are too thin. Many organisations fall into a revolving door of taking loans as a way to pay back various other loans. Along with debts, there may also be future commitments to think about. There may be an outstanding lease on equipment or the structure where the business resides. The business might have existing contracts with suppliers that need to be satisfied or might lead to penalties if terminated early.

Understanding the Customer Base, Competition and Area Demographics

Just how do companies in the location bring in brand-new customers? Often times, companies have repeat clients, which develop the core of their everyday profits. Particular variables such as new competition sprouting up around the location, roadway building and construction, and employee turn over can affect repeat consumers and negatively impact future revenues. One important point to consider is the location of the business. Is it in an extremely trafficked shopping mall, or is it hidden from the highway? Obviously, the more individuals that see the business regularly, the greater the chance to develop a returning consumer base. A final thought is the basic area demographics. Is the business situated in a largely populated city, or is it situated on the outside border of town? Just how might the local median house earnings effect future revenue prospects?