Assisted Living Services
2020
Table of Contents
1.0 Assisted Living Services in USA & Nevada ........................................................................................................................................................ 3
1.1 Background of Nevada .................................................................................................................................................................................. 3
1.2 Introduction to Assisted Living services in the USA ........................................................................................................................................ 3
1.3 Population of the U.S.A ................................................................................................................................................................................. 4
1.4 USA Market for Assisted Living services ......................................................................................................................................................... 5
1.5 Age sub-groups ............................................................................................................................................................................................. 5
1.5 Services ......................................................................................................................................................................................................... 6
2.0 Business Model & Nevada facts for Assisted Living Services ............................................................................................................................ 8
2.1 Business model canvas of Assisted living services .......................................................................................................................................... 8
2.2 Assisted Living facilities in Nevada................................................................................................................................................................. 9
3.0 Market ........................................................................................................................................................................................................... 10
3.1 Market Analysis .......................................................................................................................................................................................... 10
3.2 Competitive Analysis ................................................................................................................................................................................... 12
3.3 Market Strategy .......................................................................................................................................................................................... 17
4.0 Financials ....................................................................................................................................................................................................... 19
4.1 Funding Requirements & Startup Costs ....................................................................................................................................................... 19
4.2 Financial Projections ................................................................................................................................................................................... 23
5.0 Viability of the Business ................................................................................................................................................................................. 24
6.0 Sources .......................................................................................................................................................................................................... 25
2
1.0 ASSISTED LIVING SERVICES IN USA & NEVADA
1.1 Background of Nevada
Nevada is one of the oldest states in the USA with a 6,587 in 1860, 42,941 in 1870 and now 3.1 million in 2020. The median age is 37.5 years, 49.8%
females and 50.2% males. The racial composition demographics also paint a slight picture of the inhabitants of the state wit 66,21% Whites, 8.93%
Blacks or African Americans, 8.035 Asians, 1.23% Native Americans, 0.66% Native Hawaiian or Pacific Islanders, 10.14% other races and 4.81% of
two or more races.
The main city under discussion is Las Vegas that’s the 28Th most populous city in the USA and the most in state of Nevada under Clark county one
of the 16 counties. The population in Las Vegas is 651,319, 20.74% of the 3.1 million people within the state of Nevada and 0.19% of the 328
million USA population.
As the 35th most populated state in the USA, Nevada has a variety of Assisted care living options with most of them within Las Vegas, Reno &
Henderson. There are key three crucial costs for elder care that include;
a) Assisted Living/Home care
b) Home Care
c) Adult Day Care
Genworth survey in the USA, annual costs were $51,600 annually, $4,300 monthly, $141 daily, & an unknown hourly rate. Categorically, within
the state of Nevada, the most expensive Assisted living facility is in Carson costing $3,645 per month unlike the national average of $4,051 per
month. Only within Nevada, the average cost is $3,400 per month, a 15% drop from the national average. Also, one of the other key areas with
assisted living facilities Reno has an average cost of $3,250 and Las Vegas an average cost of $3,300.
Since Alzheimer’s is a common concurrency amongst the elderly but affects those over the age of 85 years but leads to an extra monthly cost of
$812 to $911 and an average of 20% - 30% more. The increase in cost is premised on the extra care or supervision needed by Alzheimer’s patients.
1.2 Introduction to Assisted Living Services in the USA
The assisted living home business is composed of a variety of two main forms of habitats. They include the community and resident facilities. There
are about 28,900 communities and 1 million licensed beds in the USA alone. The average size of assisted living community has 33 licensed beds
and 996,100 licensed beds.
3
A Pie Chart showing the licensed beds from the smallest to the largest.
Xtra
Large(+100)beds ,
8%
Small (4-10)beds,
45%
Large(26-100)beds,
32%
Medium (11-25)beds,…
1.3 Population in the USA
In 2018, the population was projected to reach 332,639 thousand in 2020 according to the U.S Census bureau. Interestingly, the population is
expected to hit 400 million by-,000
400,000
300,000
200,000
100,-
2020
2025
2030
2035
2040
2045
2050
2055
2060
The census statistics of specifically 2019 shows that 16.5% were 65 years and above meaning most are likely to be candidates to the assisted living
people in the USA.
4
1.4 U.S.A Market for Assisted Living Services
The Assisted living market size in the U.S is values at 79.3 billion within 2019 and has a Compounded accumulated growth rate of 5.3% from 2020
to 2027. The growth is premised on the increasing population of aged and retired individuals augmented by increase in number of illnesses and
advancements in assisted living service facilities.
The interesting thing to note is that men are fewer than women who access the assisted living services thus a need to consider more women as
key clients unlike men as most are limited by competition and what they are able to collect over their career life cycle. It’s important to note that
women accounted for a whole 70.0% of the revenue in 2019 and its expected it’ll continue this way for the next 5 years. Most men work and are
able to take care of themselves even during their retirement ages. The existence of better technology devices that can be monitored from far have
simplified assisted living service delivery and expected to further boost the market in the future. Care providers can program device reminders to
take medicine, inject themselves that’s giving rise to the resident facilities where basic support like cleaning, deliveries, transportation and others
is needed for 1 to 5 individuals.
1.5 Age sub-groupings.
The assisted living service facilities attracts four main age group with three categories above 65 years occupying the biggest percentage of this
market.
5
51.9% of the market was composed of 85 years and above senior citizens, and its expected that the 75-84 years will grow by 5.4%. Also, the
population of senior citizen above 65 years was 52 million in 2018 and expected to grow to 95 million by 2060 basing on the population reference
bureau statistics.
1.6 Key services & Other Infographic facts
Of the community assisted services, 56% are chain affiliated and 42% are independently owned.
The key services offered include;
a). Medication management and assistance
b). Meals and dining services
c). Personal Care services
d). Housekeeping services and maintenance
e). Exercise, health and wellness
f). 24-7 supervision and support
g). Transportation
6
The American health care association emphasizes how Alzheimer’s and dementia affects more users of these services and some community
assisted living service spots have wings tailored to offer mainly these services.
The key services provided to support the users of assisted living communities include the following in chronological order.
a)
b)
c)
d)
e)
f)
g)
Pharmacist
Dietician and nutritionist
Therapist (physical, occupational and speech)
Hospice and palliative care experts
Nurses
Mental health and counselling experts/Psychologists
Social workers
Other Facts
7
2.0 BUSINESS MODEL & NEVADA FACTS OF ASSISTED LIVING SERVICES
2.1 Business Model Canvas for Assisted Living Services
Key Partners
•
•
•
•
•
•
Key Activities
Health service
•
Medical service
providers
provision
Facilities
•
Health & wellness
service
services
providers
•
Feeding services
Transportatio
•
Transportation to
n providers
& from facilities or
State Medic
hospital
Aid
Key Resources
Veterans
association
•
Trained care providers
National
•
Medical personnel
Institute of
•
Facility
Health
•
Cars/Vans
•
Beds/Mattresses
•
Value
Prepositions
Customer
Relationships
Customer
Segments
•
•
•
•
Care, health
and wellness
support
24hours, 7
days in 365
days
Care providers
Medical support
Channels
•
•
•
Community
facilities
Residential
facilities
Hospitals
Cost Structure
Revenue Streams
•
•
•
•
•
•
Salary & Wages
General & Administrative expenses
65 years &
above
Senior citizen programs & projects
Medical fees
Personal care fees
The business model canvas clearly articulates the target segment attracts more people at 65 and above within the retirement age though most
are above 85 years of age. The key costs will include salaries and wages as most services need human involvement and other general and key
administrative expenses. Revenue is expected to originate from medical services, personal care services and other senior citizen programs and
project.
8
The key partners that any assisted living business can rely on include the medical practitioners, National institute of health, state medic aid and
veteran associations to ably garner substantive recommendation for the senior citizens to access their services.
2.2 Assisted Living facilities in Nevada
The Assisted living services market in Nevada is compared to California a neighboring state and the National Average of all states for some of the
key metrics in the tables below.
a). Assisted Living residents, providers and economic impact of the service on the state.
Assisted Living
residents
Assisted Living Providers
Over
85
Alzheim
er's/
Dementi
a
Assiste
d Living Beds/Lice
Comm nsed Max
unities Capacity
Averag
e
people
served
Economic Impact
Direct
Jobs
Total
Jobs
Direct
econom
ic
activity
(millions
)
Total
Economic
Activity
(millions)
State
/Local
revenue
(millions)
Federal
Revenue
(millions)
Medic
Aid
States
Californi
a
55%
35%
5,900
127,-,343 79,053 $4,000
$8,200
$367
$696
2%
Nevada 49%
39%
200
4,200
16
2,703
3,612
$199
$332
$12
$26
9%
National
Average 52%
41%
588.2
19,-,633
11,853 $614.24 $1,105.61
$52
$88.78
19%
From the table above, its evident that California has a higher demand considering it’s 6.5 times the National average and 30.2 times the Nevada
beds or licensed maximum capacity. However, it’s interesting to note that the average number of people served in the two states in high and half
the National Average. Another notable key factor is the medic aid support that’s 19% Nationally, 9% in Nevada and only 2% in California which
would be acceptable considering most people foot the bills through their insurance and pension schemes. In Nevada alone, benchmarking on the
key areas that host assisted living communities shared earlier that include Las Vegas, Reno and Henderson, only 200 communities are believed to
exist within Nevada, 588 as the national average and 5,900 within California alone that dwarfs the national average 10 times and the Nevada figure
by 29.5 times. Finally, the key disease that has featured in all states is Alzheimer’s with a close range for the two states and the National average
at 35%, 39% and 41% respectively.
9
b). Activities of daily living
Activities of Daily Living where one needs help
States
Bathing Walking Dressing Toileting Bed Transfer Eating
California
57%
56%
48%
44%
31%
20%
Nevada
57%
58%
50%
40%
33%
17%
National Average 62%
55%
46%
36%
26%
18%
According to the tabular data, its evident that the level of importance of the key services needed by the users or beneficiaries of the Assisted living
communities is chronological from bathing to eating. Comparing the percentages across California, Nevada and the national average, it’s clear that
bathing is needed the most, followed by walking, dressing, toileting, bed transfer and eating as the least required.
c). Programs and services for the Assisted living service communities.
Social
Work
Programs
41%
56%
Mental
health/counseling
services
41%
63%
Skilled
nursed
services
43%
49%
Depression
screening
practices
81%
67%
Therapy
Pharmacy Hospice Dental
Podiatry
Dementia
States
services
services
services services services
care unit
California
62%
78%
58%
54%
69%
18%
Nevada
39%
24%
38%
47%
32%
6%
National
Average
50%
54%
69%
59%
78%
59%
55%
71%
82%
29%
Though social work programs were key and close to the average (41%) for California, above average (56%) for Nevada and average mark national
(50%). It’s noticeable that depression screening was needed most, followed by pharmaceutical services, podiatry and therapy services as the top
four. However, in Nevada, Depression screening practices resonated with the national average and California, mental health and counseling
followed unlike the National and California reality, social work programs were the next and skilled nursing services that’s parallel to the California
and national average. Top services used in Nevada chronologically are; Depression screening practices, Mental health/Counseling services, Social
Work Programs, Skilled Nursing services, Dental Services, Therapy, Hospice, Podiatry, Pharmacy and finally Dementia.
3.0 Market
3.1. Market Analysis and Target
The market analysis approach involved benchmarking on already existing reports from the American Health Care Association and National
Centre for Assisted Living that provided substantive and useful data of national and state statistics. Another key source of the data used was
obtained from Genworth financial Inc website that showed national averages of cost, performance and cost comparisons for the states, key
cities and national average.
10
Mcknight’s, a senior living news, journaling and resources site published an article that originates from Argentum’s list of senior living providers
of 2020. The top 10 biggest senior living providers that ranked them based on number of units, employees, types of care offered and other
factors.
a). Brookdale Senior Living – 68,044 units
b). Life Care Services – 36,739 units
c). Holiday Retirement – 31, 684 units
d). Five Star Senior Living – 27,656 units
e). Sunrise Senior Living – 23,066 units
f). Erickson Living – 20,010 units
g). Atria Senior Living - 21,662 units
h). ALG Senior (formerly Affinity) – 12,863 units
j). Capital Senior Living – 11,878 units
Nationally, Brooksdale senior living topped the list in 2019 and 2018 as the company with the largest number of assisted living units(34,572) and
memory care closely followed by Life Care services. Though, Holiday retirement is the largest independent living provider (31,272) on the list.
Sunrise senior living, had the most properties outside USA with some in Canada and United Kingdom.
Furthermore, paying for senior care provides some of the top 10 assisted living service points in Las Vegas within the state of Nevada. A variety
of factors were considered when selecting these top 10 assisted living sites of which some include, variety of services, access to hospitals, fun
parks, libraries and other amenities suitable for senior citizens. The list includes;
a). Atria Seville
b). The Wentworth of Las Vegas
c). Acacia Springs
d). Pacifica Senior Living San Martin
e). Brookdale Las Vegas
f). Desert Springs Senior Living
g). Heritage Springs
h). Oakmont of the Lakes
i). Legacy House of Southern Hills
j). Oakey Assisted Living.
11
It’s notable that among the top 10 in the entire USA, Brookdale one of the biggest in the country re-appears on the Las Vegas list taking the fifth
position. Also, Atria Seville that is represented as Atria senior living on the national list with 9,673 assisted living units nationally. With only these
two on the list, the rest are new and also play a significant role in the lives of seniors within Las Vegas, Nevada.
3.2. Competitive Analysis
The competitive analysis provides a comparison of basic prices, offerings and average rating from caring.com, google reviews, family assets and
yelp for most of the companies stated herein.
Name of the
Company
Atria Seville
Website
Services & Amenities
Type of Service
Price
Rating
Atria senior
living
•
Private apartments with
emergency alert systems
Chef-prepared meals in
on-site dining venue
A calendar full
of engaging events
Fitness center
Utilities (excluding
phone)
Housekeeping and linen
services
Apartment maintenance
Coordination with
outside healthcare
providers
A 24-hour staff
Scheduled transportation
to local events, errands
and appointments.
Studio
One bedroom
One Bedroom deluxe
Two bedrooms
$2,295
$3,395
$3,995
$4,095
4.38
Bathing
Grooming
Dressing
Medication management
support
Housekeeping
Laundry
Starting price
Studio
$2,600
$2,600 $5,400
$3,900
$1,875 $4,300
3.6
•
•
•
•
•
•
•
•
•
The Wentworth of
Las Vegas
Wentworth
•
•
•
•
•
•
1 bedroom
Semi-Private
12
Acacia Springs
Acacia
•
Social engagement
programs
•
Housekeeping and
maintenance
Landscaped patio with
putting green
Outdoor heated pool and
indoor whirlpool spa
Fitness Center
Beauty Salon/Barber
Shop
Billiards room, movie
theater, library
Bistro Pub
Homemade, restaurantquality meals
Daily life enrichment
activities
•
•
•
•
•
•
•
•
Pacifica Senior
Living San Martin
Pacifica
•
Movie Theater with
comfortable recliner
chairs
•
Restaurant-style dining
•
Housekeeping
•
Linen services
•
Transportation to outside
One Bedroom
Two Bedroom
Starting prices
Studio
1 bedroom
2 bedrooms
Semi-Private
appointments
•
Medication management
•
Assistance in bathing,
dressing, and grooming
•
Arts & crafts
13
$2,500 $3,850
$4,390 $5200
4.5
$2,995
$2,500 $3,800
$,2995
$3,795
$2,500 $3,800
4.3
•
Card and board games
•
Beautiful garden-like
courtyard
Brookdale Las
Vegas
Desert Springs
Senior Living
Brookdale
•
•
Desert
•
•
•
•
•
•
•
•
•
Heritage Springs
Heritage
•
•
•
•
•
•
•
•
•
Quality dining
Assistance with
personal grooming
Managing medication
Fun activities
Church Services
Excursions
Dining
Housekeeping & laundry
services
Health & Wellness
Walking paths
Resident storage &
coverage
24-Hour
Security/Supervision
Three Nutritious Meals
Daily
Weekly Housekeeping
Weekly Linen Service
Planned Social &
Community Activities
Apartment Maintenance
Health Monitoring
Scheduled Physician
Appointment
Transportation
Community Health
Resource Referrals
Basic rental
Another Base rental
$2,590
$800 $7,725
3.82
Studio
$1,750 $1,900
$1,900 $2,100
$2,600
$1,700
4.1
$2,865 $4,385
$4,360 $4,905
$3,790
4.3
1 bedroom
2 bedrooms
Semi-Private
Studio
1 bedroom
Semi-Private
14
Oakmont of the
Lakes
Oakmont
•
•
•
•
•
•
•
•
•
•
•
Legacy house of
Southern Hills
Legacy
•
•
•
•
•
Exercise like Walking
Club, Yoga & Strength
and Stretch
Mind sharpening
activities like Group
Scrabble, Crossword,
Poetry Class, & Variety of
Art Classes
Purposeful & community
involvement like Literacy
Tutoring, Volunteering at
the local Animal Shelter &
Assembling care packages
for service men and
women
Singing and music
performances
Happy Hour
Excursions to Art
Galleries
Attending the symphony
Knitting Club
Book Club
Themed Parties
Medical support
Starting price
Studio
Assisted living services for
daily activities, including
dressing, grooming, and
bathing.
24-hour, on-site certified
nursing staff available.
Full-time Registered
Nurse available.
Medication monitoring
and diabetes care
Incontinence care
Respite care
Studio
1 bedroom
Semi-Private
1 bedroom
2 bedrooms
15
$3,195
$3,395 $4195
$4,395
$2,195
4.2
$3,270 $5,700
$4,150
$6,130
4
•
•
•
•
•
•
Oakey Assisted
Living
Oakey
•
•
•
•
•
•
•
•
•
•
•
•
Restaurant-style dining —
three meals daily plus
snacks
Weekly housekeeping
and linen service.
Personal laundry service
available.
Maintenance and
landscaping service.
Full activity program that
provides physical,
intellectual, social and
spiritual activities to
enhance quality of life.
Scheduled transportation
to medical appointments,
grocery shopping and
banking.
Health Services
Oversight.
Weekly Housekeeping
and Linen Service.
Medication Management
Bathing Assistance
24-hour Staffing
Diabetic Management
Morning & Evening
Dressing/Grooming
Bathroom Assistance and
Incontinence Care
Escorting Assistance
Assistance with Meals
Creative, Full-time
Activities Program
Comfortable Lounges for
Socializing and Relaxing
Studio
1 bedroom
2 bedrooms
Semi-private
$2,200 $2,595
$2,495 $2,695
Unknown
$1,850
4.05
The services offered across the 10 companies under assisted living are similar and the key pricing across them ranges varies from studio room, 1
bedroom, two bedrooms and semi-private settings. Except for Brookdale whose information of pricing wasn’t obtainable, its clear that most
16
assisted living service providers provide a studio, 1 bedroomed and two bedroomed option. Across the block, Desert springs senior living has the
cheapest option at $,1700 - $1,900 USD per month within Las Vegas, Nevada on 6650 Flamingo road. One of the most expensive studio rooms is
provided by Oakmont of the Lakes with a beginning price of $3,395 and a surprising $2,195 for semi-private.
3.3. Market Strategy
It’s quite complex to attract senior citizens to access assisted living services or other similar services because only 5% of advertising actually
targets them. Thus, its key for any player in this market to consider most of the behaviors, tastes and preferences of people within Nevada and
the wider areas of the U.S to ably capture their attention.
The senior citizen market is composed of specific categories of people and the crucial thing is that most of them are affluent, have assets, money
and are looking for options and places in which they can spend the reminder of their lives. Some of these key characteristics are key for any
player to consider when trying to penetrate the citizen market.
They key consideration is the segment;
i). Pre-retirees. The segment mainly involves the key people within (50 – 64) years. The baptism as a senior begins at 55 but many within their
early 50s are ready for the realities of their next life thus forming a good segment to target.
ii). Active retirees. Living on a fixed income, this group is within the 65+ age range and most of their income originates from pensions, savings,
assets, social security and other legally certified mediums.
iii). Late Retirees. Like the young ones, this segment skips the conventional retirement age and continue to work through their early retirement
years and include 65 – 75-year old’s that could be in part time jobs. A great segment to target for retirement and offer the assisted living
services.
iv). Grandparents. A unique segment of 50+, this grouping has mainly older parents still leaving with, supporting or being supported by their
relatives and because of the excess time they have. Most adverts directed to them always count or close the sale.
In bids to market, it’s important to note that most of the people in these segments have bank accounts, own assets and have a high spending
power augmented to their 70% disposable income availability in the USA. Though their financial stand is marred by debt, most senior prefer to
spend on hobbies without fear of any future calamities or incidences.
In the state of Nevada, 11% of the Nevada population fall within the targeted groupings. It’s crucial that when targeting the demographic
realities are placed into consideration when targeting to ably attract these groupings.
17
Key strategies to attract assisted living customers.
i). Online channels. 7 billion is spent by people above 50 on online purchases, meaning any online tools that attracts the various segments but
mainly those in their early years of retirement is a great option. Another research finding, indicates that individuals within their 50-65 shop
online with more confidence than all the other age groups thus signifying a need to target mainly there pre-retirees.
ii). Social Media. Of the 3.1 million people within Nevada, approximately 49.3 % use Facebook, the social media giant to share their experiences,
chat with friends and access trending factors. Thus, its key for any business targeting to enter this market to greatly consider this segment of the
market.
iii). Advertising. Most senior for so long that they understand that advertising does act as an awareness base for product or service offering that
they are willing to delve into. Thus, any entity targeting the seniors should document their adverts in a contextual mode that can capture the
attention of this sub-group and create a remarkable impression about the service offerings.
iv). Mobile advertising. Most individuals who have mobile phones have used them for more than half of their lives, thus a need to consider this
as an alternative channel to engage and attract seniors. Using mass access services through their mobile phones, one can easily access those
below 70 but within the segments identified above mainly the pre-retirees, first time active retirees and others.
v). Television advertising. Most senior are accustomed to watching television and some of the best times to attract them is during the times
when their favorite programs are shown on the various channels. Another interesting fact, is that 50 + watch More TV than the younger
generation.
Crucial requirements to consider when advertising to seniors.
i). Direct message. When engaging seniors, it’s important that the messages are straightforward and avoid the persuasive marketing or sales
language. Direct messages are received and interpreted accordingly thus a need to be clear, simple and self-explanatory.
ii). Calls to Action. A message that provides a call to action or a step further into the advertised product or service is more likely to be bought
unlike another thus for all messages to consider this aspect when marketing.
iii). Emphasize value. Based on their experience, seniors are more interested in value and benefits of a product unlike its price.
18
4.0 Financials
4.1 Funding Requirements and Start-Up Cost.
Item
Property, Plant & Equipment
Startup costs
Description
Cost
Quantity
Piece
Piece
Piece
Piece
Piece
Piece
Piece
Piece
Piece
Piece
Piece
Piece
Kit
Piece
Piece
-,-
-
Investments
Board Games & other Key Stationery
Chess
Piece
Scrabble
Piece
Monopoly
Piece
Checkon/Backgammon
Piece
Rubik's cude
Piece
-
1
1
1
1
3
Tables
Chairs
Indoor Pair of Table & Chairs
Outdoor pair of table & chairs
Beds
Bookshelf
Patio Swing
Wheel Chair
Washing Machine
Refrigerator
Television
Projector
CCTV Surveillance Kit
Computer
Colored Printer
Sub-Total
19
Amount
Inception Monthly
440
1,734
4,-,-,-,685
-
Books
Sub Total
Utensils
Electric kettle
Cutlery
Cookware
Kitchen Utensils set
Dinner & Lunchware
Bottles
Glassware
Chopping board
Sub Total
Short term investments
Juice Mixer
Shell Gas Cylinder
Mattresses
Bed sheets
Basins
Blankets
Towel
First Aid Kit
Sub-Total
Sub Total
Operating Expenses
Food
Cooking Oil
Sugar
Spaghetti
Piece
25
10
250
345
Piece
Piece
Set
Set
Set
Set
Set
Piece
-
-
-
Piece
Piece
Piece
Pair
Piece
Piece
Set(4 Pieces)
Piece
-
-
99
192
4,-,050
22,543
1.41 litre
1.8 kilograms
Kilogram
4
2
1
1
2
5
4
5
6
20
16
20
26
Corn
Bread
Wheat Flour
Eggs
Baking Powder
Vinegar
Milk
Irish Potatoes
Rice
Sweet Potatoes
Chicken
Beans
Peas
Meat
Fruits
Vegetables(Greens)
Salt
Sub Total
Stationary
Reams
Manila Papers
Markers
Colors
Box Files
Document Tray
Stapling & Punching Machine
White board
Sticky Notes
Cello tape
Sub Total
Packet
Loaf
Packet
Tray
Packet
1 litre
3.76 litres
1362 grams
454 grams
1362 grams
454 grams
283.5 grams
283.5 grams
Kilogram
Pieces
Pieces
737 grams
Box
Piece
Packet
Packet
Piece
Piece
Piece
Piece
Piece
Piece
-
-
-
-
-
$40.99
3
5
-
-
-
21
Care & Laundry Items
Toilet Paper
Mopper with a rod
Dust Pan
Brooms
Toilet Brush
Soap & Detergents
Sub-Total
Dozen
Piece
Piece
Piece
Piece
Package
Wages
Founder & Team Leader
Head of Pharmarcy & Nursing
Care Givers
Security Personnel
Chef
Sub Total
Other Expenses
Rent
Utilities(Eletrcity, Water & Garbage)
Advertising
Communication
Website
Company Registration
Licensing
Sub Total
Sub Total
Final Total
-
1
3
2
4
5
1
-
-
Salary
Salary
Salary
Salary
Salary
4,500
4,000
2,600
1,500
2,100
1
1
2
1
2
4,500
4,000
5,200
1,500
4,200
19,400
4,500
4,000
5,200
1,500
4,200
19,400
Month
Month
Month
Month
7,-
-
7,-,425
29,493
52,036
7,-,425
22
29,822
The key costs reflected are some of the unique items needed to begin the assisted living business in Las Vegas. Most of the amounts indicated
are a direct reflection of the average costs of the same items within Nevada and the state of Las Vegas. The critical thing is salary that occupies
37% of the budget but is subject to reduction if everything flows smoothly. Also, the rent indicated here is a figure that lead to the purchase of a
5-acre plot of land worth 1.8 million USD on an amortized basis. Thus, the ability for any person interested in this business to capitalize on this
opportunity will provide a base to provide more assisted services and ownership of a 5-acre property within the state of Nevada on star hills.
Furthermore, depending on if this option is suitable because it can host more guests and these improves on the economies of scale, eases the
possibility of mortgage financing or probable bank loan depending on the interested party’s credit score. Notably, the 5-acre piece of land is
within the senior citizen locality in Las Vegas and creates room for bigger opportunity for new entrants to provide better services, affordable
prices and quality service offerings.
4.2 Financial Projections/Financial Plan
To obtain a market size estimation, we shall benchmark and combine some existing facts. 11% of the Nevada population is within the retirement
age. However, with lesser certainty of exact statistics that receive assisted living services.
Estimated population of 65+ old’s = Percentage of 65+ within Nevada × Population of people in Nevada
Estimated Population of 65+ old’s = 11% × 3.1
Estimated Demand for assisted living in Las Vegas = 11% × 651,319
= 341,000
= 71,645
On considering the average cost for assisted living within Nevada, we can obtain the market share of assisted living services in Nevada
Market Size of Assisted Living services in Nevada = Average Cost of Assisted Living × Estimated Population of 65+ old’s
= 3,400 USD × 341,000
= 1,159.5 million USD.
Estimates market size in Las Vegas = Estimated demand × Average cost of Assisted Living in Las Vegas
= 71,645 × 3,300
= 236,428,500
However, factoring in the other players in the market, unknown factors that one might realize during the assisted living service cycle or having
conversation with those in the field, we can say the market is huge. Due to a variety of challenges, like tight competition, difficulty in
differentiation, price wars and other similar realities, it’s complex for any new business to come off as better from the existing players. However,
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another good thing to note is that Las Vegas, Henderson and Reno have the most populated cities within Nevada and some of the best assisted
living amenities though barely any stands out consistently to outdo the rest of the player.
Estimated Revenue = Number of users × Industrial average cost for assisted living services
= 10 × 48,000
= 480,000 USD.
Attracting 10 seniors for a period of 12 months paying an average of 48,000 USD annually or 4,000 USD weekly, provides a prospected revenue
figure. It’s interesting that this figure is slightly higher considering the variable costs within the year after multiplying it by 12 months.
Estimated Profit (Loss) = Estimated Revenue – (Initial Set-Up Costs + Variable Costs)
= 480,000 – (52,036 + (Selling, General & Administrative expenses × 12))
= 480,000 – (52,036 + (29,822×12))
= 480,000 – 409,900
= $70,100
If the business is able to begin as expected, it might make a profit of 70,100 USD considering the average payments per senior, key costs and
ability to buy most of the fixed assets at more affordable prices.
5.0 Viability of the Business
Venturing into the assisted living business is debatable for a variety of reasons. Some of which include;
a). Difficulty in differentiation. It’s difficult recruiting better nurses or pharmacists consistently to continuously perform and stand out from the
competition making this a complex strategic approach.
b). Labor costs. It’s expensive managing most variables of this business cycle with labor costs beating 42% of the expenses and yet the most of
the figures are below national average wages thus a need to consider using the services of volunteers or family and friends to lessen the
expenses during the fast months of the business venture.
c). Ability to market to attract prospects. The senior citizen is a complex customer with specific needs and requirements, thus getting a person to
commit close to their entire annual salary to receive a service requires great understanding of their needs. Thus, the marketing and sales cycle
should be very clear from the beginning to enhance the rate at which leads are converted to customers.
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6.0 Sources-.
https://www.census.gov/data/tables/2017/demo/popproj/2017-summary-tables.html
https://www.ahcancal.org/Assisted-Living/Facts-and-Figures/Pages/default.aspx
https://www.cdc.gov/nchs/data/nsltcp/State_estimates_for_NCHS_Data_Brief_299.pdf
https://www.grandviewresearch.com/industry-analysis/us-assisted-living-facility-market
https://worldpopulationreview.com/states/nevada-population
https://en.wikipedia.org/wiki/Demographics_of_the_United_States
https://en.wikipedia.org/wiki/Las_Vegas
https://www.payingforseniorcare.com/nevada
https://www.mcknightsseniorliving.com/home/news/argentum-list-of-largest-senior-living-providers-adds-10-for-2020/
https://www.payingforseniorcare.com/assisted-living-in-las-vegas-nv
https://www.sheerid.com/blog/how-to-market-to-seniors/
https://www.sheerid.com/blog/how-to-market-to-seniors/
https://www.zillow.com/homedetails/Starhills-Las-Vegas-NV-89141/-_zpid/
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