Creating Value within your Care Home Portfolio
Whether you have one care home or several care homes, creating a value added sustainable environment with a positive culture supporting and appreciating the needs of all stakeholders, impacts an inspiring place to work encouraging an upward occupancy trajectory
The Challenge
Improving occupancy of a care home to pre pandemic levels and more has been a steady plan for many care home providers since 2020. Public confidence has gained traction with care seekers and their families returning to the care home sector, in part where family support or the homecare has run its course.
As Prosperwell (formally Smooth Digital) will tell you having a bespoke digital marketing plan in conjunction with other marketing ideas can help to generate the right branding PR for your care home, being especially important for a growing care home business.
Marketing and PR
With the Government announcing £250 million funding for winter beds in hospitals showcasing that your care home can look after care seekers for onward respite or permanent care via a professional and visual looking website helps to create enquiries to your care provision.
Enhancing your care home website with videography specialist Five on a Bike supports occupancy and staff recruitment. The founder, York Woodford-Smith commented that the team is:
“passionate about bringing the world of care centre-stage and showcasing it in its best light.”
New care home builds
The wish list of care home entrepreneurs continues to gain traction as care home providers across the UK seek out sites for land acquisition, obtaining planning permission and develop the site encompassing green and innovative design.
It is evident that the market for new builds is expanding with new luxury and innovative offerings to appeal to current and future generations aimed at the self funding market.
The alternative refurbishing & expanding a converted care home property
The care home market currently has an array of properties to acquire by new entrants and existing providers from the smaller care home of 20 beds or less to the median size of 35 to 55 to the larger corporate care home of 60 plus beds with full ensuite facilities.
The care home market place is currently moving quickly for care homes with 35 to 45 beds with the majority of ensuite facilities, in localities throughout the UK where demand for beds outstrips supply.
Thus, location is a significant factor for a growing care home brand in addition to the care model itself.
Transparency of fees
Transparency of fees remains an important factor for the care seeker and their families with some models of care service offering an all inclusive fee to include as examples, haircuts, newspapers, family lunches, physiotherapy and chiropodist services.
Some care services also offer accompanied GP and hospital visits if family and/or friends are a distance away and could be a deciding factor for a care seeker and their families.
Care seekers and their families continue to increasingly review care home provision on line to start with before shortlisting a selection of care homes to visit, subject to their immediate needs.
Using technology to improve access and outcomes in social care
The wider social care sector covering adult services, supported living, complex care and children services are seen to be increasingly benefiting from advances in technology as care providers continue to take up the digital transition from paper care records to digital, from face to face training to virtual training taking place to fit in with the current needs of a flexible workforce.
Digital care, such as Nourish, encourage independent wellbeing alongside real time care plans enhancing the person centred approach with the added value of keeping family members in touch with their loved ones, as opposed to waiting at the end of the phone and/or booking an update appointment.
Care providers offering digital services adds value to the care provision forming increasing importance with care seekers and their families easing the move into a care home. Post pandemic, digital facilities such as digital reception and immediate feedback, all add value to the care home provision with increasing uptake in these areas.
The software market has accelerated within the care sector with a successful implementation tending to take around 6 months with champion support, pilot training and then full transition. Identifying gaps within the service and putting solutions in place is all part of the digitalisation process with care planning a priority within the digital setting, expanding to encompass other areas such as compliance, estate maintenance, finance and rostering.
Obtaining feedback surveys from your care teams will confirm what is and what is not working in the digitisation space, with specialist software companies working with care providers to adapt to changing needs.
Funding your care home growth plan
A care home business entering its growth trajectory will require investment and funding in order to scale up.
Serviceability of debt funding remains key with scenario planning and cash flow forecasting analysis to ensure that your care home growth strategy aligns with your debt funding strategy.
The Independent and specialist care home brokers at Chandler&Co recommend to new and existing care home owners to clearly outline your business plan and growth strategy so that lenders can fully appreciate your vision when assessing your care business for credit sanction.
Within the business plan highlighting how you intend to expand your care home portfolio, the expected returns on investment and a timeline to complete your care home growth strategy are all important factors to consider.
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As an existing care home owner lenders will want to collate evidence that your current business is sustainable and viable requesting historical and up to date financial information. Assessing the management information from your target care home acquisition together with the latest 12 months occupancy figures, including the current and projected EBITDAR and staffing analysis, will provide the baseline information for the funding application.
Assess your debt capacity by calculating your debt to equity ratio and debt service coverage ratio. Your Broker will be able to assist you with this.
As part of the lending process you will be asked about collateral and security for the potential lending which could be in the form of security on your existing care home portfolio with or without additional personal guarantees.
The Brokers at Chandler&Co consult the wider lending market researching the prevailing interest rates for the level of debt and loan to value that you are considering in the next step for your care home growth. The Brokers compare different lenders’ terms, interest rates and repayment profiles to result in indicative terms which align with your financial goals and risk tolerance.
The loan structure will align with the strategy of your choosing, whether that be a fixed or variable loan or both which could include an initial period for interest only followed by a capital and interest repayment term profile.
Lenders also take into account your latest Regulatory ratings and inspection reports which may also involve mock audits and inspection reports from external consultants.
Demonstrating an understanding of the care home market within your business plan forms an important part of your growth strategy along with confirmation of the strength of the incumbent management team with any action plans to strengthen the governance of the growing care home portfolio.
Along the acquisition journey engaging with specialist legal, accountancy and tax services supports the complexities of a growing care home business.
Listen and act on staff feedback
Listening to the team for gaps in training assists with staff retention including ideas generation and additional wellbeing demonstrating support for all.
With innovation comes praise and reward and setting new goals, taking the team with you for ideas implementation adds strength to a care settings governance and positive culture, which in turn results in increased referrals for individuals seeking care alongside staffing enquiries.
With many care settings at the start of their sustainability journey we can expect growing innovation as care teams experience combined efforts to improve the environment in their lives as well as the care setting that they work in, all adding value to the care home provision for the longer term.
Having experienced virtual reality in another setting (the Roman Villa at the Newt in Somerset!), although new to the social care sector, training to assist with knowledge and retention goes a long way (Moonhub VR training). For example, understanding the Alzheimer's and dementia journey to assist with person centred care.
Training and development plans engage your care team which will assist the care home group as is grows with skills sharing.
Evidencing continuous improvement and innovation for all who work in and use the service to deliver ongoing and high quality care, demonstrate to the Regulators that action plans are being embedded into your care service adding ongoing value.
Regulator compliance and workforce development
Demonstrating strong governance and surrounding yourself with the right people in the right roles contributes towards a successful growth care business.
Empowerment of people goes a long way when creating an added value care business and indeed in all businesses.
Ensuring that you have a strong HR policy whether inhouse or outsourced alongside real time compliance policy procedures support a growing care home portfolio with consistency across the group.
Are you a Care Home Entrepreneur?
Having a vision combined with a forward looking agile strategy to execute a business plan demonstrate your commitment to a much needed care sector, alongside being able to identify the strengths within your care team resulting in increased staff retention, longer periods of full staffing levels with minimum or no agency use, all creating value within the care business.
Showing that you have champions, able to work with different commissioners as your care group grows, adds value to your care home increasing care seeker enquiries to your care setting.
Having a Governance Board with a strong ethos and vision is part of your growth strategy, with some care groups benefiting from non executive directors as they grow.
Care homes with a strong brand have the capability to enhance their relationship with the local community and stakeholders, able to meet the fair cost of care enabling them to pay the care team what they deserve and support staff retention currently and for the longer term.
Being known as a care home provision that goes above and beyond, with a team whom enhances the care home owner’s vision, adds value to the care setting, potentially increasing the EBITDAR now and in the future when an exit plan may be considered.
Julie Hopkins Author
For more information contact solutions@ownacarehome.com or complete the contact form at Ownacarehome here.
