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Thinking of starting your own care business?


At W&P we routinely receive enquiries from people asking for support in setting up their new care business. Because the financial


barriers to starting or buying a residential home are significant, most enquiries are for new domiciliary care businesses. This is great news for the industry as new good quality homecare providers are always welcome to provide more capacity and of course choice for people needing care at home.

However, I speak to far too many people who have decided to set up a care business who having spoken to me for 15 minutes go away with slightly less enthusiasm for their new venture. The reason? Quite simple – They haven’t done their research.

So, if you are reading this having decided to start up your own domiciliary care business these are the issues that are often misunderstood or in many cases completely overlooked:

Do you have a business plan? It should as a minimum cover Operations, HR, Sales, Quality Management, Health & Safety, Finance & Continuous Improvement

Where will the work be coming from? If your plan is mainly local authority work, have you spoken to the commissioning team to check you can get on their approved supplier list? Many local authorities let contracts for up to 5 years, so if they have just awarded new contracts the door may be closed for new entrants for many years.

Do the math! If the local authority supplier list is open, what rates do they pay? This is VITAL as many do not pay sufficient rates to


make a reasonable profit or in some cases any profit at all! This is compounded if care is commissioned on a pro-rata basis – get this wrong and your new venture will not last long.

The organisation and registered manager CQC applications need to be submitted together – if you don’t have care experience you must find a manager experienced in care before you can submit your application.

Have you got the necessary business insurances in place? You will need employee and public liability cover of at least £5m (some councils ask for £10m) and Professional Indemnity of £1m.

How are you going to fund your business? You need enough money to pay your bills whilst you are waiting to be paid by your customers. Ideally you should have 3 months working capital, so if the operating costs are £5k per month, you should have £15k in the bank the day you start trading.

Do you have the operational infrastructure in place? You will need this in place for CQC registration – Policies and Procedures, Care Plan templates, Training plans etc.

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I.T & Software – Do you have the hardware and software to run the service? How are you going to Roster your carers, Pay Staff Wages, and Raise Invoices etc.? Many local authorities now make it a contractual condition that providers must have electronic call monitoring systems (ECM) in place which are expensive to buy and administer.

Finally – Know the regulations! Not verbatim but have a general grasp of them, many people I speak to think that the Key Lines of Enquiry are the regulations – they are NOT!

This is not an exhaustive list, setting up a care business is a challenging and complex project and there are many things to consider but if you ensure the above issues are covered your new business will have a much greater chance of success.

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