How to Set Up a Care Home Business

Latin descent female nurse or doctor checks blood pressure of a senior woman patient. Home or clinic setting. Woman is over 100 years old!

There are currently around 17,100 care homes in the UK, which may seem like an overwhelming figure. However, according to, the demand for services significantly outweighs the demand, especially as many small business care homes are facing closure. This means that there’s a potential gap in the market, depending on the location and the type of patients targeted.

Choose a Care Home Type

Before exploring which type of customers you’ll be attracting, you need to decide which care home setup you favour. The two main routes to follow when it comes to care homes are nursing homes and residential homes, and what changes is the type of care provided. In a residential home, accommodation, general care, meals, and entertainment are all provided. Whereas, nursing homes provide 24/7 access to nursing provisions.

Regardless of the type of care home you choose, you’ll need to make sure it conforms to the Care Standards Act (2000), which notes that all care homes must be in a position to fulfil the needs of all residents.

The Equipment You Will Need

Care homes use lots of equipment to facilitate their mandate to residents, so the cost of such equipment will need to be factored into your business plan. The equipment you need will be determined by the type of care home you choose to open, but it will all encourage independence and improve the quality of life, dignity and safety of all residents. Equipment you will need includes:

  • Walking aids (frames and sticks)
  • Moving and handling equipment
  • PPE
  • Lifting equipment (hoists)
  • Mobility aids (grab rails)
  • Medical grade beds and mattresses

This is only a small snapshot of the sort of equipment you must source. If you head over to, you can shop for an extensive range of care home equipment.

Associated Costs

After setting up your home and purchasing equipment, you will need to take into account the ongoing costs of operating a care home, which is unfortunately only going up as inflation lingers. Here are the usual associated costs of running a care home:

  • Marketing. Advertising your home and what you offer.
  • Maintenance. General building care and equipment repairs/replacements.
  • Staffing. Paying employees will take up around 50% of your budget.
  • Overhead. Gas, electric, council tax, and water bills.
  • Food. Food costs vary per resident, but typically range between £100-£800 a month.
  • Vehicles. Residents need to attend appointments and have various day trips.

How to Price for Residents

Choosing how much to charge residents will always be challenging, but it needs to represent the level of care you provide and cover the operating costs. A good place to start is observing competitor prices, which can be used as a benchmark. As well as this, work out the total amount you will receive from your local authority for each resident, as this can be reduced from the cost.

There is a clear demand for nursing and residential homes in the UK, making it an extremely viable business to enter. However, you must ensure you have enough financial backing to get started and continue to deliver high levels of care.

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