How Do You Start a Home Care Agency in the UK?

Are You Ready to Start a Home Care Agency?

If you’ve found your way to this guide, it means you want to know how to start a home care business.

Before we dive into qualifications, regulations, and other important elements you should know, let’s start off by asking two significant questions. Is this a profitable business venture, and what qualities do you need as a home care provider?

Is starting a domiciliary care agency profitable?

The short answer is yes. Becoming a domiciliary care provider is a realistic route to business ownership, supported by a growing demand for in-home care by a significant ageing population in the United Kingdom.

The domiciliary care industry has a market size of £5 billion, and demand for private care support will continue to grow.

Home care providers are businesses with significant value. A glance over domiciliary care businesses for sale on BusinessesForSale.com demonstrates that revenue exceeds £1 million for several listings. However, while profits are important, it should not be your end goal. Caring for others should be your priority.

This industry faces its own unique set of challenges. It is a highly regulated sector, and setting up a care agency requires careful analysis, intensive training, specific qualifications, and a sound business plan. But with the right knowledge, ambition, and preparation, you can start providing private care to those who need it most.

What qualities do you need to start a home care business?

A home care provider’s qualities are fundamental to running an effective and profitable business.

Lucy Campbell, CEO of Right at Home UK, echoes this sentiment. As an expert in this sector, she offers the following advice on qualities that an entrepreneur or potential franchisee needs to uphold:

Resilience and mental strength:

“Regardless of the business you’re in, running it is going to be pressurised. Whether you’re going into a franchise or starting up by yourself, you’re going to be doing a lot of things for the first time - things that are out of your comfort zone. You’ll feel anxious, and you’ll experience periods of uncertainty and self-doubt. Be honest with yourself. Do you have the mental strength to overcome those challenges?”.

Making a difference and motivation:

“If you are drawn to caring for others, you must be absolutely certain that you are truly motivated to make a difference in those people’s lives – which you will be responsible for. You need to manage your expectations, because your first few years will be tough. In the early stages of your start-up, you’ll need to be available 24/7. Motivation and having values that align with making a difference are crucial”.

Be approachable and professionally compliant:

“You’ve got to like people in this sector. A lot of your business development will come from the connections you have within a community. You need to embrace all aspects of community engagement. You also need to have a high level of integrity and a strong moral compass. There are no shortcuts in this sector, so you need to be highly compliant from a professional point of view”.

How Do You Set Up a Home Care Agency?

So, let’s run through the complex (although necessary) steps you’ll need to take to set up your home care business.

Why is a business plan crucial?

It is worth noting that a business plan for a home care agency is complex. You’ll need to start by defining what care you will provide. Will you offer nursing, companionship, emergency care or personal care?

A business plan for a home care agency will include many elements. Some of these include:

• Your professional background and industry experience
• Important qualifications to care for adults (we’ll get to this soon)
• Support networks you can utilize
• Statement of intent (business name, services, recruitment)
• Your vision and mission statement
• SWOT analysis
• Financing breakdown for your start-up
• A detailed analysis of your services
• An intricate analysis of the market and your competitors
• Your marketing strategy

Governing bodies, regulations, and registration

Under the Health and Social Care Act 2008, you are legally required to register your home care business. The Care Quality Commission is the main regulatory body in England, and you’ll need to register your home care business and the Registered Manager in charge (this might be your role). This will be a time-consuming process, but the CQC website offers a breakdown of what to expect.

For Scotland, it is the Care Inspectorate, and for Wales, it is the CSSIW.

You’ll also need to apply for a Disclosure Barring Service (DBS) before registering with the CQC.

It’s important to note that the CQC ask the following five questions when inspecting new and existing home-care agencies:

• Is it safe?
• Is it effective?
• Is it caring?
• Is it responsive to people’s needs?
• Is it well-led?

The commission also has an intricate inspection process, which you can read about here.

This sector is highly regulated, so it is crucial that you stay up to date with rapid changes to guidance. You should also understand the following legislation:

• Health and Social Care Act 2008
• Mental Capacity Act 2005 and the Deprivation of Liberty Safeguards.

Qualifications and training

Specific to England, the qualifications you’ll need will depend on the service you provide and what role you want to fill.

For example, if you want to become the Registered Manager of your home care business, CQC will require you to have a diploma in Health and Social Care (Level 5).

If you decided to recruit a senior care worker, they will need to have a Level 3 diploma in Health and Social Care.

If you recruit employees who will focus on basic home care or live-in care, then a Level 1 or Level 2 qualification in Health and Social Care is required.

Of course, knowledge is always power, so investing in alternative training will benefit you in multiple ways. Other qualifications you can consider include:

• NVQ Level 4 in Leadership and Management for Care Services
• Nursing care qualifications
• Courses on developing care skills

Insurance considerations

Insurance is a fundamental element when setting up a home care business. After all, you are responsible for the safety and comfort of your clients, and you or your team may administer medication.

You should consider the following insurance:

• Public liability
• Professional indemnity
• Cover for medical malpractice
• Treatments liability
• Employer’s liability

Recruiting your team

It is highly unlikely that you will run this business alone. As your business grows, so will your team, and it is crucial that they are qualified, compassionate, reliable, and trustworthy.

Recruitment will be a challenging task, so it is essential that you have an airtight strategy. Think about the qualities you want your candidates to have, including their roles and responsibilities. Your strategy should consider:

• Salary expenses (which should be accounted for in your business plan)
• Induction times and training
• Benefits and reimbursements (if any)
• How you will market the vacancy (utilising a recruitment agency might be an easier route)

Funding Your Home Care Agency

Lucy Campbell, CEO of Right at Home UK, explains that underestimating the level of working capital needed to start any business is very common, especially a domiciliary care business.

The level of finance you will require to simply enter the market will be significant, let alone the running costs, equipment, and salary expenses.

While an exact amount will depend on the size, location, and client base of your business, you will need around £120,000 - £130,000 to start your home care agency.

Other expenses to consider include:

• Innovative home care management software
• Accountancy software
• Uniforms
• Registration fees
• Paid advertising

Financing options for your home care business

If you don’t have access to capital through personal savings, you do have other options. Of course, applying for a loan is a route you can consider. Remember, lenders are weary of financing start-ups, so ensure your business plan is close to perfect.

If you’d like to conduct more research on loans, you can read our loans to buy a business guide. While it concentrates on funding options to acquire a business, it still offers valuable loan information that entrepreneurs can benefit from. You can also visit Swoop, a valuable website that provides a comprehensive list of funding options.

Applying for a small business grant is also a route you can consider. While it requires time, dedication and intense preparation, grants for social care businesses are widely available in the UK. You can read our small business grants guide for more information.

While we do strongly encourage you to start your own business, it is worth mentioning that investing in a reputable franchise brand will leverage a greater level of finance from banks. For franchises, banks are likely to lend up to 70% of your total investment, as it is perceived to be a successful business model.

Nonetheless, we do recommend that entrepreneurs seek professional advice from an accountant or trustworthy business consultant.

How Do You Market Your Home Care Business?

You might find it valuable to know that you can acquire new clients in different ways when it comes to in-home care.

You could gain clients through the public sector route, where you receive contracts from your local council through tenders. This section of the guide will focus on private home care marketing, so if you decide to go the public sector route, we recommend conducting more research.

Of course, you have the option of marketing your own agency directly to potential clients. After all, you won’t have a route to market without a solid marketing strategy.

“Your marketing strategy should be a blended approach of both online and offline marketing. You want to be capturing the hearts and minds of your audience through rich media content by the people who are giving and receiving your services,” says Lucy Campbell, CEO of Right at Home UK.

Campbell emphasizes the importance of being authentic in how you represent yourself. Your marketing efforts should demonstrate real indicators of success and quality.

With that in mind, you should consider adopting the following offline and digital marketing tools:

• A website domain: with a strong SEO strategy in place. If SEO is not your strong suite, consider outsourcing this expertise.
• Traditional advertising: this form of advertising is crucial for a home care business. You should place yourself at the heart of your community, handing out flyers, taking photographs, connecting with industry magazines and newspapers, and talking to potential clients face to face.
• Referral marketing: as we mentioned before, you need to show people you have real indicators of success and quality. This will manifest itself in the form of reviews on Homecare, your rating with the CQC, and testimonials. Growing these elements of your marketing strategy will increase referrals to your business. Think about forming relationships with local healthcare centres and hospitals too!
• Social media: every business owner knows the importance of increasing your visibility through social media. Think about creating at least three social media platforms for your home care business.
• Trade shows: networking and support from industry experts is key to developing and sustaining the success of your home care agency. We always encourage entrepreneurs to attend trade shows relevant to their sector. Health care trade shows you can attend include:
  • The HealthCare Show (this includes multiple programmes relevant to the health sector)
  • The Care Show
  • Primary Care Health

Starting a Home Care Agency Is Not Your Only Option

By now, it is clear that starting a home care business will not be a simple venture. While your entrepreneurial drive is a commendable quality, you do have other routes into business ownership.

Franchising:

The most promising and guided route is franchising, a form of ‘supported self-employment’, as Lucy Campbell calls it.

Of course, we can tell you that you can benefit from a tried and tested model, and that you won’t make the same mistakes a start-up would. But there is something more important:

“The true magic in the domiciliary care franchise sector is the support network. For example, at Right at Home, our franchise owners have over 70 individuals doing the same thing. There is a sense of unity from people who aren’t competing against you. You can lean on others for emotional support, guidance, and best practice,” says Campbell.

If you’re thinking of pursuing this route, feel free to explore the home care franchise opportunities on our site.

Buying an existing business:

You can also consider buying an existing health care business for sale. While you won’t have the joys of creating your own entity, you will certainly gain access to an established client base, brand and cashflow.

If you’d like more advice on buying a business, feel free to read our dedicated guide.

Checklist to start your home care business:

1. Ensure you have the motivation, emotional strength, and professional compliance to start this venture
2. Get your business plan sorted
3. Understand all the regulations and prerequisite qualifications, get your DBS, and register with the CQC
4. Invest in appropriate insurance
5. Recruit your team of qualified and trustworthy employees
6. Get financing for your home care business
7. Develop an effective marketing strategy and execute it
8. Give the best and safest care to those who need it

We wish you well on your business venture, and we hope this guide offered valuable information on starting a home care business. Feel free to connect with us if you’d like to speak to someone from the team.