Home Instead Franchise Cost, Failure Rate & Owner’s Salary 2024

If you love the idea of offering quality and personal senior care, then opening a Home Instead franchise is the right opportunity for you.

Home Instead Franchise

Home Instead believes that everybody should be able to live independently at home regardless of their age. And so, it strives to provide tailored-made at-home care for the franchise.

However, to own the franchise, you must first get clarity of how much the franchise will cost and after you have invested, what will your role as well as the franchisor.

In this article, we have collected every information that you need to own the Home Instead franchise.


About Home Instead

Home Instead is one of the leading senior care providers worldwide. It was founded in 1994 in Omaha, Nebraska, by Paul and Lori Hogan.

They launched the company to take care of their 90-year-old grandmother. Home Instead specializes in providing tailor-made, flexible at-home care for senior people.

It is currently operating in over 1,000 locations and has one of the largest network of senior-care facilities in the world. It is also one of the best senior care franchises to own.

As a franchisee, you must be prepared to help the elderly and make them and their family’s life more comfortable and relaxing.


Home Instead Franchise Model

Cost Or FeesAmount
Initial Investment      $98,000 to $125,000
FranchiseYES
Franchising Since1995
Franchise-Fee$54,000
Royalty-Fee4%-7%
Ad Royalty Fee2%
Estimated Outlets1,217


How Much Does It Cost To Open Home Instead Franchise?

The cost to open the Home Instead franchise ranges between $98,000 and $125,000. However, it also charges other fees like franchise fees, ad royalty fees, and royalty fees. The franchise fee of Home Instead is $54,000, whereas the royalty fees range from 4% to &%.

The franchise fee covers extensive new owner training, a business start-up kit, a network performance support team, research-based programs and systems, and a protected franchise territory.

To get complete details on what all costs Home Instead requires, here is a breakdown for same:

CostsAmount
Franchise Fee$54,000
Real Estate Expenses$1,000-$3,500
Operating Software (3 months)$0-$500
Training And Living Expenses$500-$1,000
Equipment$1,000-$5,000
Signs$1,000-$5,000
Inventory$500-$1,000
Advertising (3 months)$1,000-$5,000
Additional Expenses (6 months)$30,000-$40,000
Miscalleneous Miscellaneous
Total Start-up Costs$98,000-$125,000


Franchise Requirements Of Home Instead

Other than the costs and fees, Home Instead also has certain franchise requirements that are crucial to address.

Firstly, they are looking for an ideal owner who is someone who has the right intentions, has a passion for improving the quality of life for seniors, and puts their compassion for others first.

Moreover, the company lists down the qualifications it is looking for in its franchise owners:

  • Strong Salesmanship
  • People management skills
  • Consultative sales background
  • Desire to work with aging people
  • Full-time commitment
  • Compassion
  • Leadership skills
  • Relationship building
  • Financial capacity for investment

How Much Does Home Instead Franchise Owner Make?

Home Instead is not just an affordable franchise, but it’s also a business that is earning $2 million in turnover per year on average.

When talking about the Home intead’s franchise owner salary, then there is no such data provided by the company.

However, we estimated that, on average, a Home Instead franchise owner makes $2,229,000 in revenue per year.

Note: This estimation is based on the average sales per franchise for 604 of the 609 franchises that operated in 2021.

Based on this estimation, we can calculate the net profit by assuming a 10% profit margin:

Financial OverviewPercentage of RevenueAmount ($)
Individual Franchise Annual Revenue100%2229000.00
Rent11.25%(250762.50)
Insurance5.63%(125381.25)
Salaries22.50%(501525.00)
Franchise Royalty Fees5.63%(125381.25)
Utilities2.25%(50152.50)
Cost of Goods Sold (COGS)28.13%(626906.25)
Labor (Variable)14.63%(325991.25)
Total (Expenses)90.00%(2006100.00)
Net Profit10.00%222900.00

Note: The displayed expenses are estimates based on industry averages and standard costs. Actual expenses may vary due to factors like location, business size, and market conditions. We recommend conducting detailed research or consulting with a financial advisor for a tailored financial analysis.


Failure Rate Of Home Instead

YearOutlets at the Start of the YearOutlets at the End of the YearNet Change
20206096090
20216096090
2022609613+4

For the Franchised outlets:

  • In 2020, the failure rate was (0)/609×100≈ Can’t be divided by zero
  • In 2021, the failure rate was (0)/609×100≈ Can’t be divided by zero
  • In 2022, the growth rate was (4)/609×100≈ 0.65%

Company-Owned Outlets:

YearOutlets at the Start of the YearOutlets at the End of the YearNet Change
2020220
202123+1
2022330

For the Company-Owned outlets:

  • In 2020, the failure rate was (0)/2×100≈ Can’t be divided by zero
  • In 2021, the growth rate was (1)/2×100≈ 50%
  • In 2022, the failure rate was (0)/3×100≈ Can’t be divided by zero

Total Outlets:

YearOutlets at the Start of the YearOutlets at the End of the YearNet Change
20206116110
2021611612+1
2022612616+4

For Total outlets:

  • In 2020, the failure rate was (0)/611×100≈ Can’t be divided by zero
  • In 2021, the growth rate was (1)/611×100≈ 100%
  • In 2022, the growth rate was (4)/612×100≈ 0.65%

According to the data mentioned above, we can see that the franchised outlets for Home Instead started with no growth but only failure. However, in the year 2022, the company opened 4 new franchises, showing a growth of 0.65%.

On the other hand, company-owned Home Instead outlets grew only in 2021, showing a growth rate 50%.

Overall, when we combine the data of franchise and company-owned outlets, we can see that the Home Instead experinced failure in 2020 but from 2021-2022 it started to grow at the rate of 100%-0.65%.


Home Instead Payback Period

Using the investment of $125,000 and average profits of $222,900, we can determine how long it will take to earn back the initial investment:

Payback Period = Investment / Yearly Profit = $125,000/ $222,900 = 0.56 months

So, based on these figures and the calculation, we can see that it will take 5 months or 1 year for you to recoup your initial investment amount on average.

However, this time period could be more or less depending on your actual total initial investment and profits earned.


Training & Support Of Home Instead Franchise

Home Instead franchise provides both on-the-job training, which is 9 hours, and classroom training, of 44.5 hours.

This franchise training program must be completed by the franchisees or the managers in charge in Omaha, Nebraska, or at any other location the franchisor will designate.

During the initial training program, the franchisor will pay and arrange for up to 5 nights of hotel accommodation for the franchisee and the other person attending the initial training program.

The franchisees must attend and successfully complete the training program and open their franchise business within 30 days after the date of the Franchise Agreement.

Moreover, the franchisor will provide specialized support, guidance, and resources to the new franchisee during the first 10 weeks. This support will be provided through telephone calls, video conferences, and emails.


Obligations And Restrictions Of Home Instead Franchise

The franchisors require all the franchisees to personally supervise the franchised business. If they operate through a corporation, partnership, or limited liability company, then they must employ a manager to operate the franchised business but must have completed the training programs for the franchisor.

Also, franchisees must only offer services that are within the scope of approved services. These services include companionship services, home helper services, personal care, and any other specialized services.


Terms & Agreement Of Home Instead Franchise

The term of the franchise agreement in the Home Instead franchise is 5 years.

But if, on the expiration of the franchise agreement, the franchisee has complied with all the rules and regulations, then they have the right to renew for an additional term.


Home Instead Financial Assistance

Unfortunately, the Home Instead franchise doesn’t offer any direct or indirect franchising. The franchisor also doesn’t guarantee a franchisee’s note, lease, or obligation.

The reason behind this is that, most often, many franchisees use the funding option, even when they have enough cash to cover the initial investment.


Comparison

NameFranchise FeeRoyalty FeeInitial Investment
Visiting Angles$51,950-$89,9503.5%$125,460-$171,150
A Place At Home$34,5005.5%$59,000 – $150,000
Home Instead$54,0004%-7%$98,000– $125,000


Conclusion

In conclusion, the Home Instead franchise is one of the leading franchises in senior care in the world. So, if you want to own this franchise, you’ll be a part of a reputed and experienced franchise.

However, the franchise has listed some qualifications for the franchisees it is looking for. So, make sure that you evaluate them and yourself.

This will ensure that you possess the skills and are ready to dive into this golden opportunity.


FAQs

Is Home Instead a good franchise to own?

Home Instead is an honorable company. It has been named the best buy in franchising by Franchise Times as a part of its Zor Awards Program.

Where is the headquarters of Home Instead?

The headquarters of Home Instead is located in Omaha, Nebraska.

Who owns Home Instead?

Home Instead was acquired by Honor in August 2021. It became the flagship brand for its high-quality, relationship-led style of home care.

How many locations does Home Instead have?

Home Instead has been running the business since 1994, and since then, it has expanded to over 1,200 offices in 13 countries.

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