Group Home SWOT Analysis

Group homes are highly economically stable businesses given that they are able to produce a substantial amount of their income from publicly funded health systems. There are a number of reasons why people enter group home, but most commonly they are used among disabled people that require an assisted living situation in order to go about their lives. One of the key strengths as it relates to a group home is that these businesses are able to remain profitable and cash flow positive at all times. Once the facility reaches 100% occupancy, these businesses have very few issues as it relates to their revenue-generating operations. These businesses can be highly profitable and specially in major metropolitan area markets where social workers will place developmentally disabled people in group homes. The ongoing marketing efforts with these businesses is relatively low as well once the businesses announce themselves to government agencies as well as private social workers.

One of the weaknesses associated with the group homes that they can have moderately high operating costs especially from a facilities standpoint as well as specific program costs. Most group homes also provide their residents with their meals as well. As such, a qualified entrepreneur needs to keep a close watch on the underlying expenses that are commonly associated with a group home business. There are also substantial insurance issues that must be dealt with, and large insurance policies – especially relating to those for liability – must be held at all times.

For opportunities, most group homes are able to readily expand by simply establishing new facilities. Of course, there are moderate increases in the yearly fees are associated with a residents while they at the facility – but it is most commonly needed to develop additional facilities in order to increase revenue streams. This is really the only way that these businesses grow.

As a relates to threats, a group home’s biggest threat is changes to political policy that would impact to the reimbursement from publicly funded healthcare systems. As such, an entrepreneur it starts a group home must keep a close eye on any major political changes that could impact the legislation that guides reimbursement. Competitive issues for these businesses are typically minimal given that once a facility reaches 100% occupancy, they had very few issues with resident retention.

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