Senior care franchisors expand all over the map
A caregiver at Home Instead helps a client at one of the franchisor’s international units.
Here’s an eye-popping statistic: The global population age 65 and older is expected to triple by 2050, to 1.53 billion. A slew of U.S.-based franchisors are positioning to be there, organically and via acquisitions.
For the first time, BrightStar Care plans to open new franchise locations in multiple countries across the globe.
The Chicago-based home-care franchisor in February created an international division to expand in Canada, the United Kingdom, Australia, Mexico, China, Japan, New Zealand and Europe.
Using the master franchisee or area developer model, BrightStar hopes to have one such agreement signed by year’s end and at least 10 more deals by 2024 in the targeted countries.
Some of the biggest home-care franchisors in the United States are targeting foreign markets for growth. It’s a hot trend as the number of people 65 years of age and older worldwide is expected to triple from 516 million in 2009 to 1.53 billion by 2050, reports the U.S. Census Bureau.
For instance, take Home Instead Senior Care. The Omaha-based firm has added 12 international franchises this year. But it’s far from done. Between September and year’s end, it expects to add 27 more franchises abroad.
In 2015, plans call for Home Instead to add about 50 franchises in nine countries, with the United Kingdom (20) and Germany (10) leading the charge.
Trevor Brocklebank, master franchisee in the United Kingdom for Home Instead, says the brand is opening franchises there at a faster clip than anywhere internationally. Its franchise fee in the U.K. is about $60,400. As of September 2014, Home Instead had 1,022 franchises in 17 countries.
“The biggest challenge to our expansion is making sure we have enough caregivers, but our caregiver recruitment and retention initiatives have been well received,” he said.
Right At Home, also based in Omaha, expects to open as many as 50 international units in 2015. That includes pursuing expansion into two to three new markets in Western Europe and Southeast Asia, plus continued growth into new areas in its existing markets of the U.K., Brazil, China, Canada, Ireland and Australia. The development will augment seven locations scheduled to open this year in the U.K. and one each in the Netherlands and Japan. As of September 2014, Right At Home had 455 franchises in nine countries.
Sunrise, Florida-based Interim HealthCare enhanced its overseas presence by acquiring U.K.-based Bluebird Care Franchises. The deal allows Interim HealthCare to pick up more than 187 franchises offering non-medical care services in England, Wales, Scotland, Northern Ireland and the Republic of Ireland.
This September, Interim HealthCare’s parent company announced another acquisition, buying Just Better Care in Australia. The franchisor of in-home, non-medical and medical care services, Just Better Care has one corporate location and about 30 franchise locations in major cities in Australia including Perth, Adelaide, Melbourne, Victoria, Brisbane and Sydney.
Bloomfield Hills, Michigan-based ComForcare, a franchised provider of non-medical, home-care with operations in Canada and the U.K., plans to expand globally as well. Philip LeBlanc, vice president of franchise development, says they’re targeting a number of European countries as well as South America for new franchises.
A natural expansion
With senior-care franchises among the fastest-growing systems in the United States in recent years, the international market is a natural expansion for American brands, says Steve Beagelman, CEO and president of SMB Franchise Advisors, a Philadelphia consulting firm. Many foreign countries are receptive to U.S. franchise brands, he says.
U.S. senior-care brands have operated abroad for years and have a significant presence there. But industry experts contend there is still more room for growth both domestically and internationally as global aging trends rise.
“Seniors around the world are seeking to stay in their homes as they age, and their families are looking for a home-care provider they can trust,” said Shelly Sun, CEO and co-founder of BrightStar Care.
BrightStar Care hired international franchise development veteran Anthony Padulo to lead its global expansion. He previously helped Dunkin’ Brands, BP Oil and Aamco expand into foreign markets. As executive vice president, international, at BrightStar, he will focus on closing deals with area developers, or with master franchisees, who can sub-franchise after opening two to five of their own locations.
Right At Home’s Allen Hager, founder and executive chair, says having a skilled master franchisee in place is the most important factor that determines success when expanding abroad.
As with all Right At Home master franchise candidates, David McKone was required to have $500,000 in liquid capital to assume that role for the brand in Ireland in January 2013. As of September 2014, the franchise had one location in Dublin, where McKone was born. His agreement requires him to operate a “pilot” office for a year to learn the business so he is better equipped to support the operators he is recruiting. He expects to sign on 20 franchisees.
Hager says a challenge is finding the right voice to communicate with foreign residents, particularly in an Asian country.
Other obstacles abroad for home care brands may include meeting regulatory operating requirements and ensuring their product or service is accepted.