Post on 08-Jan-2017
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PrivateDutyHomeCare:TheChallengetoGrowth
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Growth 6-8%
Annually
New capital inflows
Increased competition
Increased agency failures
Increase in acquisitions
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Non-Franchise
60%
Franchise40%
OwnershipType
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Total estimated number of agencies : 15-17K
Total annual industry revenue estimated: $20-30 billion
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~25 agencies have achieved annual revenue greater than $20 million
Only 1% to 3% of the industry has annual revenue over $10 million
Average agency has annual revenue between $1.5 and $3 million
Private Pay Home Care industry estimated at 15,000-17,000 agencies
Fundamental Reasons for
Fragmentation
LowBarrierstoEntry
LackofDifferentiation
ProliferationofFranchises
LimitedAccesstoCapital
PriceCompetition
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Access to field staff—increased competition among other home care companies, healthcare providers and industries that need a low-wage workforce adds pressure to supply. In 2014 there were 1.8 million personal care aides employed. By 2024, the industry will require 2.4 million to meet demand.
Multi-sided business model—one of the more difficult business models to execute. The home care agency acts as the broker between the family (buyer) and caregiver (seller). However, the model is further complicated by a two-phased sales cycle for clients (referrals sale and family sale and controlling quality with caregivers.
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APrivateDutyHomeCareExecutiveMembershipGroup
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• Whatdoesittaketobreakthroughindustrybarriers?• Whatarethesuccessfulcompaniesdoingtoscale?• Whoisinvesting,buyingandlookingtopartner?• Whatishappeninginotherpartsofhealthcarethat
representopportunities?• Howtoaccessotherexecutivestoshareinsights,
collaborateandinnovate?
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Chip Measellschip@insidescalability.com
202.618.4713
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