When running a care home / domiciliary care business, cost savings can be tempting, as they often present an opportunity to enhance financial sustainability. However, while there are numerous areas where expenses can be trimmed—such as staffing levels, training programs, and facility maintenance—it's crucial to recognize the potential damaging implications of such cuts. For instance, reducing staff numbers might lead to inadequate care for clients, resulting in lower quality of life and potentially harmful outcomes. Similarly, cutting back on training can compromise the skills and knowledge of caregivers, which are essential for providing safe and effective support. While it may be possible to achieve short-term financial relief through these measures, the long-term repercussions can include increased staff turnover, higher rates of client dissatisfaction, and even regulatory penalties. Therefore, it's essential for care providers to strike a balance between cost-saving initiatives and maintaining the high standards of care that clients deserve, ensuring that any financial decisions are made with a comprehensive understanding of their potential impact on your business, staff and clients.
Know the right cost savings to make
The business owner was desperate to make cost savings but did not know where to begin. It was becoming harder and harder to pay staff at the end of the month, for no obvious reason.
We began with a full financial review to understand what was going on in the business, what changes had occurred in order to identify when the financial situation began to drift.
By identifying that staff working patterns were being changed to suit the needs of the clients rather than the business needs. it was uncovered that too many contracts had become unprofitable due to the changes that were made without thought to the financial consequences.
This discovery led to a detailed analysis of staff coverage and working times.
It became very clear the changes that were required to make cost savings. Each contract had to be profitable so the number of staff working were cost effective. Processes were introduced and clients could not demand care when they wanted it unless it was cost effective to the business.
The business owner was shocked to find out what had been going on in their business. They came to see that there were a number of contracts that were unprofitable due to the way the staff cover was arranged. Clients had been changing the times they wanted care and were demanding the specific carer they wanted. By bringing this to the attention of management changes were made that enabled amazing cost saving to be made by changing processes, staff coverage and expectations from clients. All services offered were profitable.
Telephone: +44 (0)7748 052522
E-mail: colin@chbss.co.uk
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