Being part of a franchise meant that Thomas had a ready-made “kit” that included website templates, computer programs and hiring guidelines. “Franchisees don't have to reinvent the wheel,” says Carol Roth, a business strategist and the author of The Entrepreneur Equation. They generally don't have to figure out procedures or marketing strategies on their own. In exchange for giving the parent company a percentage of the gross revenue, they get to operate under the aegis of a known brand and to benefit from the experience of other franchisees. Although it's tough to get figures on whether franchises have a higher success rate than independent start-ups, Roth adds, most experts think they do.
The downsides of a franchise: the fees you continue to pay to the parent company and a lack of creative control (the founders decide how you will present the brand, in marketing, logos and so on). If the parent company gets bad publicity, you may be affected as well. For instance, when an outbreak of E. coli was linked to several Taco Bell outlets in 2006, other franchisees experienced a temporary downturn; the same thing happened at Domino's Pizza in 2009 when a video on YouTube showed one franchise's employees fouling pizza with unsanitary “ingredients.”
A few years ago, two Home Instead franchise offices in Maryland were accused of race discrimination, with the U.S. Equal Employment Opportunity Commission alleging that they'd let clients specify the race of the caregivers assigned to them. Home Instead settled the lawsuit in December 2010. Complaints about some Home Instead offices have also popped up on consumer websites.
Thomas says her business was unaffected by these dustups. To maintain excellent client relations at her own franchise, she relies on careful quality control: finding caregivers who have a genuine sympathy for the elderly (many of Thomas's hires got into the business because they'd cared for their own relatives and found the work rewarding) and doing rigorous background checks. In the end, she takes on only about 20 of the 300 people who apply for jobs each month. The next step is training her workers to handle sensitive situations; for example, how to respond if a client doesn't want help getting out of a chair but may hurt herself if she tries to do it on her own. And Thomas monitors caregivers by making surprise visits to her clients' homes.
For a first-class experience, however, matching a client with a caregiver who has a similar background is key. “We set up one elderly gentleman, a retired executive, with a male caretaker who was a retired IBM executive, and that worked out very well,” she says. “I love my clients dearly, and I have a real affinity for them. It feels good to know that I'm helping to make their last years comfortable. That's why I'm in this business.” ❦
Running the numbers
103Age of oldest client (and her caregiver was 74—the family requested an older attendant so the two would have more in common)
120 to 140Number of clients Thomas has at any given time
$70,000Total start-up costs for Thomas's first year in business ($50,000 for the franchise kit plus $20,000 for cash flow)
$18Average hourly rate paid by clients, depending on their requirements
$9 to $14Hourly wage that Thomas pays her home-care workers (nationwide, the average hourly wage is about $9.50, and nursing aides earn about $11.50 an hour)
This story first appeared in More magazine's December 2011/January 2012 issue.
Michelle Stacey is the author of The Fasting Girl. She blogs at the-food-bitch.blogspot.com.
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