Great Business Ideas: Find a Need and Fill It

Great Ideas for your Small Business: Find a Need and Fill It

When nellie may sutton was diagnosed with Alzheimer’s disease in 1985, her son Joseph began searching for a place where she could live safely and comfortably. After checking out nursing homes and elder care services, Sutton decided to rent a ranch-style house and hire a caregiver to take care of his mother. He then found four other Alzheimer’s patients to fill the extra bedrooms, and a novel business concept was born.

“I opened my first home to care for my mother—no other reason,” said Sutton, founder of Sutton Homes, based in Englewood, Colorado. Sutton sells franchises to entrepreneurs who want to operate homes for the elderly around the country. Serving America’s aging is providing tremendous opportunities for savvy entrepreneurs like Sutton.

About 19 million Americans have a family member suffering from the progressive, degenerative disease that affects memory. Many Alzheimer’s patients require round-the-clock attention and supervision. Smaller group homes are often more suitable for Alzheimer’s patients, who find nursing homes, with their many activities and visitors, too hectic and confusing, according to Joe Sutton.

Gladys Thankachan, a Los Angeles gerontologist and hospital consultant, said small units of five to seven residents are more friendly and accommodating than large institution- al facilities for people in the early stages of Alzheimer’s. However, she said, independent “board and care” homes such as Sutton’s can be difficult to regulate. Yet given the increasing geriatric population, she said, such homes are a step in the right direction, “if we can make sure the standard of care is appropriate.”

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Although anyone can apply for a license to operate a board and care facility in most states, Sutton teaches people how to operate the homes in a professional manner. Sutton has franchisees operating almost fifty Sutton Homes in the United States.

Potential Sutton Homes franchisees make an initial investment of $250,000 for the minimum of three homes, to $450,000 for a nine-home package. That amount covers leasing the homes, renovating them, and paying for the staff for about a year. Franchisees also pay Sutton a 7 percent royalty on revenues, plus a 1 percent marketing fee.

Once franchisees are up and running, several homes can generate profits into the six-figure range, according to David Coker, vice president of franchise development for Sutton Homes.

Sutton said he tries to balance business savvy with elder care. He insists the services be top-notch but affordable. Sutton Homes provide franchisees with a week of training in Colorado, plus several days in their hometowns. The company also encourages franchisees to hire professionals to staff and manage the homes.

Sutton realized there are thousands of Americans dealing with the same stress he faced in finding a safe place for his mother. For him, Sutton Homes filled a personal need and, at the same time, produced a real business opportunity.