How Franchising Will Disrupt The Residential Assisted Living Industry

The Changing Environment

COVID-19 has opened the eyes of the public to many new ways of "doing business". We are working remotely, we are ordering curbside, and we're cutting down the capacity in almost every single space of commerce. This general shift in how we do business has highlighted the advantages of the smaller senior living options that residential senior care homes provide.

In fact, this increase in demand for smaller care home options has gained the attention of large, nationally recognized assisted living providers, some of whom have begun seriously examining adding the model to their portfolios or are already dipping their toes into the residential care home space.

The co-founder of Capital Senior Living, a large, national, independent-living provider headquartered in Dallas, Texas, left the company several years ago to create a seven home community model in Carrollton, Texas and plans on expanding in many other areas. Another Dallas, Texas-based company, Pegasus Senior Living is looking into evaluating the addition of smaller homes to their offerings — believing that innovations like that will flourish over the next 3 years.

Even with this shift towards smaller residential options, there remains a major advantage that these larger national providers have over independent residential care homes — the power of name recognition and branding. While residential care homes can provide a more intimate and higher quality of care, they lack the ability to create a cohesive brand strategy to build national name recognition and reputation. The introduction of a strategically-built franchise system can change all of that.

There Is A Growing Market With Built-In Demand

The stats speak for themselves; there are a large number of seniors turning 65 and 80 years old every day. However, what is rarely ever discussed is how that increasing number creates a built-in demand for quality, residential care home options. The truth is people age every day, which means that the potential client base is ALSO growing daily. Nothing stops aging — the economy can't stop it, global warming can't stop it, national healthcare can't stop it, and neither can whoever wins the next election. Aging happens, and no person or thing can put the brakes on it! The need for the Residential Care Home industry is only going to grow for the next few decades, which creates Built-In Demand.

The Industry Is Extremely Fragmented; "Mom And Pop" Businesses Prove The Demand

The overall assisted living industry considers residential care homes a "Mom and Pop" industry. Argentum, the national, for-profit assisted living association, doesn't even recognize residential care homes as competition in any way, shape, or form. However, without the demand for services from the public, tens of thousands of residential care homes across the country would be out of business, proving an untapped potential in this space. Franchise systems take advantage of fragmented industries by creating standardizations for processes, services and systems — creating more industry organization and efficiency for the consumer, and profitability for the provider.

The Industry Has Unorganized And Substandard Marketing

As much as many have tried, the independent Residential Care Home industry, as a whole, lacks the marketing and name recognition needed to be considered a threat to the larger national assisted living providers in their markets. The Residential Care Home industry doesn't have one recognized brand name that can compete with the larger facilities as a whole… YET. Majestic Residences marketing under a recognized brand will create an entirely different category in the assisted living industry — one that merges national name recognition, branding, the power of marketing, and intimate, high-quality care.

The Industry Has A Low Acceptance Rate For Technology

The in-home care industry has evolved and adapted to a changing marketplace by accepting and updating its technology. If technology can keep a senior in their home longer, what does that mean for the Residential Care Home industry? It implies that residential care homes should see residents who need more care from the moment they move in. A franchise system that enthusiastically embraces technology will be a serious disruptor in the industry. Technology such as Electronic Healthcare Records, or technology that can better monitor residents' care will be not just needed — it will be a necessity.

Individual Homes Lack Branding Power

Individual Care Home Owners typically do not have the financial strength and backing to generate a national brand experience. The vast majority of residential care home operators give great care, but cannot identify with brand name recognition, brand values, brand promise, brand identity, brand differentiation, brand market position, brand messaging, or brand experience. However, franchise systems eat branding for breakfast. That turns into substantial benefits for franchisees — the ability to charge higher fees, an extensive waiting list, strategy models to open multiple homes, and working smarter, NOT harder.

Conclusion

All the signs are there for a successful disruption of the residential care home industry by partnering with great residential assisted living homes, leveraging technology, know-how, and a team of experienced franchising professionals. The power of a national brand has begun in the residential care home industry. Majestic Residences have the systems, the experience, the finances, the passion, and the drive to create a marketing force to contend with the larger assisted living companies. That's the real power of Franchising.