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OLDCARE GERONTOLOGICAL SERVICES
MÁRIO MOURAZ SANTOS INTERNATIONAL MASTER IN HOSPITALITY MANAGEMENT – HMU1
EADA - JULY 2010
TABLE OF CONTENTS
1. Objectives of the Business Plan 2. Executive Summary 3. Analysis of the idea and the business opportunity
4. Presentation of the company and development team
2 3 5 7 14 18 27 30 31 34 50 53 56 57 58
5. External Analysis 6. Internal Analysis 7. Research & Development & Innovation 8. Agreements, alliances and Outsourcing 9. Expansion Plan 10. Marketing Plan 11. Quality Management 12. Financial Plan 13. Conclusion 14. Bibliography 15. Acknowledgments
1. OBJECTIVES OF THE BUSINESS PLAN
This creation of this business plan is an attempt to put in practice the knowledge I got during this year through the Master in Hospitality Management. For this reason, I introduce different topics from diverse subjects as Quality, Expansion, Human Resources, Finance, Strategic Management, Marketing, Operations, etc. Besides that, and equally important, it was my intention to create a business plan focus on the part of the Expansion and Marketing for an existing company back in Portugal called OldCare, which I have been following even since it was a project and then when they turn out into a real company. One year later here it is that company trying to grow as a result of their past and present success trying to find new ways of growing. Therefore, this business plan is an attempt to give my contribution and to help OldCare in their further grow and hopefully many years of success.
Right now. Besides. Autonomy and Quality of Life.2. with academic background in health technologies. since their collaborators (all specialized in aging and health) came from the universities at a low cost. In order to better assist the elders in their overall needs. EXECUTIVE SUMMARY OldCare Gerontological Services is a company that provides gerontological services for elder people with his headquarters in the city of Bragança. OldCare is composed by a team of professionals specialized in aging. being one of the winners. etc) to expand to the all North region of Portugal. Since then the project started obtaining power and it became a reality in December 2008. Active Aging. Furthermore. consulting. who operates in the northeast territory of Portugal. where they studied and developed an adequate and customized response to the needs of the elder population. they are linked to the academic environment so that they can take advantage of scientific studies and research to develop new solutions that demonstrate improvements in quality of life for this growing population in Portugal. They believe that by differentiating their services. Their work philosophy is based on keeping the elder in their home environment. they are all the time developing strategic alliances with complementary companies. they can gain a competitive advantage in such a competitive market and they have also been quite successful in keeping their costs low. They provide all kinds of personalized gerontological services supported in principles as promotion for the Health. Portugal. OldCare is looking for all types of partners (financial. OldCare came out from an academic project that was then presented in an entrepreneurship programme. The company started operating in July 2009 and it completed already his successful first year with revenues of more than €30. they give training and provide formation in various topics in the area of health. They also sell geriatric furniture and equipments as technical aids for the senior population. 4 .000.
5 .This business plan was created to help this company in achieving that goal. by formulating an expansion and marketing plan as I strongly believe OldCare can grow further if some strategic changes and methodologies are implemented.
health consciousness is changing and there are each time more people looking for quality services. elder people and their families are looking more and more for someone who can take care of the elders in their homes. 30% of the Portuguese population will be 65 years older. someone who can be responsible for the elders in a personal level by doing their food. helping them dress. skin and hair care. One of the causes of this phenomenon is the health conditions that are in general much better than some years ago. ANALYSIS OF THE IDEA AND THE BUSINESS OPPORTUNITY It is a reality. social and cultural. 6 . Besides. after retirement. taking care of their personal hygiene. maintaining the house or doing small structural arrangements. People are becoming more aware of the importance of creatinghealth funds in order to guarantee their quality of life after an entire life of work. washing their clothes. Besides that. but it just came to Portugal a couple of years ago. This concept has been around in some European countries and United States for more than 30 years. that in about a decade. Pulling out those elders from their homes and throwing them to Elderly Residences is a reality that soon will be over because those residences are completely full and queued. it is also important for Portuguese society to keep relations inside the family and avoid the break between the elder and his family. Related to these facts is the increasing awareness of the term ‘Gerontology’ in Portugal.3. A new trend that gerontological industry has to take into consideration is that nowadays. We are assisting to an exponential increase in the number of old and less active people as population in getting old and the average life expectancy is increasing. Gerontology is the science that studies the process of aging in four different aspects: physiological. psychological. etc. The big problem comes because Portugal doesn’t have proper socials structures and there is a lack of professionals to care about this entire people that are getting older.
who with innovative solutions believe they can solve these big problems that the country and its population are going to face. 7 .OldCare’s Gerontological Service is the name of the brand new company that seeing all that happening took their chances and put together a team of professionals all specialized in aging.
all specializing in aging. 8 . PRESENTATION OF THE COMPANY AND DEVELOPMENT TEAM . It is composed by a team of professionals. They have in their headquarters multipurpose room where they can either give training. For that reason they have an extensive logistical assistance to the household extended to the Northeast region of Portugal.4. where they studied and developed an adequate and customized response to the needs of senior citizens. geriatric physiotherapy and rehabilitation or even leisure activities and entertainment. consulting services related to health care structures for the elderly population and training plans. Autonomy and Quality of Life. Their headquarters are located in the city center of Bragança. What do they do? They provide all kinds of personalized Gerontological Services supported in principle as promotion for the Health. Active Aging. They offer a personal page for each client on their website. located in the center of Bragança and operating in the Northeast territory of Portugal. Location and Facilities Their work philosophy is based on keeping the elder in their home environment. They also offer a set of complementary services as sale of technical aids equipments and geriatric furniture for the senior population. with information updated on a daily basis for the family who are distant can be aware of day-today of their loved one. with academic background in health technologies. provide group sessions of psychic and physical intervention. OldCare Gerontological Services is a company that provides gerontological services for the elder population.
It was then developed within the 5th Poliempreende Program to encourage entrepreneurship in Bragança Polytechnic Institute (IPB). it developed structurally to become a reality in the District of Bragança. Provide information to approach the familiars more distant. Research and Innovation. OldCare is a pioneer in the use and development of the name ‘gerontological services’. so that the person may also feel involved and integrated socially. They base themselves in the Study of the Aging to provide a customized response tailored to the needs of senior population. Avoid breaking the bonds of affection with the family and socio-cultural environment by providing home services of reference. The project was then presented to the competition and was one of the winners. Since then. 9 . Quality of life and Social responsibility. Quality. Their shared values are Integrity. together with the Center for Entrepreneurship of IPB. Self-Esteem. Autonomy. so that service delivery is the most customized and complete as possible. with quality and personalization that meets the needs of this population. Create partnerships with the society.History of the company The OldCare came out in 2007 as a result of an academic project. They develop strategic alliances in order to better assist the elders in their overall needs and they are linked to the academic environment so that they can take advantage of scientific studies and research to develop new solutions that demonstrate improvements in quality of life for this growing population in Portugal. Mission “OldCare's mission is to promote the value of the senior person”. Excellent Customer Service. Active Aging.
Corporate Strategy 10 . Biological. Objectives Provide a service of excellence. Working under a multidisciplinary perspective. Involve their employees in their philosophy and mission. Be innovative in the Gerontology context. Achieving the full satisfaction of their customers. Use data collected in scientific studies that have proven their importance in the improvement of our services. Propose and develop innovative solutions for a Healthy and Active Aging in the family environment.Vision “Being the market leader for the region of Trás-os-Montes” Provide a service of quality. Create and develop new solutions that improve the quality of the services provided. where the health and welfare. Promote customer loyalty. Promoting the expansion of services to the Northern of Portugal and to close Spanish cities. are allied to the autonomy and development in society. Psychological and Social person. Create a cohesive team work and high motivation.
maintaining the same philosophy and identity with the first ´base´ of the company. Simplifying the logistics of the service. 11 . OldCare Philosophy The philosophy of OldCare is to provide customers with an excellent service in an extensive logistics operation. Ensure competitive prices.Their strategy is characterized by the intention to keep expanding to other cities within the north region of Portugal. Target market Their target market is people sixty five years older with support needs on a personal level but not in total dependence. To offer a service tailored to the needs of each client available 24 hours a day. flexible and open on the first visit to the customer. For that reason. OldCare gives particular importance not only to the recruitment and selection processes but as well the procedures for training their employees. academic and technical knowledge in health and aging. The opening of new bases with the same services and capacity will give them the opportunity to keep focusing on their mission concerning the part of giving a very personalized service to their customers. being these ones essentials to ensure the commitments with customers. widening the area of action in order to minimize operating costs. OldCare believes that their greatest asset is its staff. Provide a working team with scientific. Create intervention and care plans through scientific principles. ensuring that the service provided by the Company complies with the following objectives: Be fast.
Nursing – A partnership with the Nursing Clinic ‘Brigantina’ allow them to provide nursing services as palliative care. 12 . Treatment of clothing.The ability. Stimulating the body through physical training and mobility. Develop a life project whose aim is a better integration into the community. hair. developing and using sets of exercises suitable for each case. among others specialties. in the displacements. Attendance . and increased self-esteem and self-realization.Occupy elders free times constructively and objectively implies a detailed assessment of the person. and for an exponential increase in the autonomy of the person. These are two essential ingredients for a healthy active aging. Services Domiciliary Service – Someone who takes care of the elder personal hygiene. Entertainment and Free-times . helps in dress. engagement and performance of their employees are crucial to the quality of service and the achievement of their Personal Appreciation Plan. behaviour. That requires a positive interaction in the discovery of tastes and expressed or implied skills. in skin care.Hospital and pos-hospital stays. and still providing small structural arrangements. Psychic and Physical Intervention . which is focus on improving competitiveness by improving working methods. among others. displacements and more diverse. Meal preparation or choice from a menu. knowledge of the client and of their needs. working with experienced professionals who already have a broad background in the market. Sanitation and light housekeeping. Leisure Activities. Old-Sitting – Having someone for a specific situation to monitoring. medical appointments. Thus they want to ensure always the best quality of their services.Stimulate the mind through cognitive training.
Training and Formation – Certified technical training for the sector related to aging for either formal or informal caregivers.Adapted furniture. their recovery and their quality of life. strokes. with the possibility of repurchase the equipment after two years of use. Presentation of the entrepreneur and development team 13 . to assure that people with mobility limitations can move freely and safety. employees. The geriatric rehabilitation is a crucial element in the recovery from falls. Consultancy Service . Bio-Healthy Geriatric Parks .Tele-assistance with choice of location via GPS. when under the circumstances this is the most comfortable way to improve their welfare. facts that can and should be countered with the purpose of recovering the maximum possible the autonomy of the elder. Geriatric Physiotherapy and Rehabilitation - They provide physiotherapy services in the customer's home. loss of mobility and muscular dexterity.Consultancy and advice for planning and projection of structures related with responses aimed at serving the senior community. for indoors and outdoors. Telemedicine Service .Sale of equipment that promotes the physical activity of low-effort. All information is transmitted to a 24-hour-Call-Center connected to a database where the patient medical history is recorded. directors of institutions or family members of the elders. Other medical devices can be provided as well. Elimination of Architectural Barriers – Supplying options for both private houses and public areas to remove architectural barriers. Sale and Rental of Geriatric Furniture .
The owner and CEO of the OldCare Gerontological Services is Master in Health Services Management from the University of Trás-os-Montes and Alto Douro (UTAD) and graduated in Gerontology at the School of Health Sciences. The team is composed by a group of professionals specialized in aging. where they study and develop everyday an appropriate and customized response to the needs of the elder population. with academic backgrounds in the area of Health Technologies. Organizational Chart TECHNICAL DIRECTION NURSING CLINIC PHYSIOTERAPIST GERONTOLOGIST S AUXILIARS 14 . Polytechnic Institute of Bragança (IPB).
economical. social.5. Thus I found the following factors for Portugal: Political factors: Political stability in the country. EXTERNAL ANALYSIS The PESTEL Analysis is the first measurement tool used to analyze the macro factors from the external environment that can influence a business. Less access to bank credit. Tax system (increase of tax payment in 2010). Social factors: Portugal is a peaceful retirement destination. including political. 15 . Distrust of investors. For that reason it is important to do a detailed analysis by type of factors. Increasing number of competitors in the market. Less administrative bureaucracy. High quality of life. Lowest crime rate in Europe. technological and more recent environmental and legal. High level of unemployment (11%). Diário de Notícias Less support from entrepreneurship organizations. Economical factors: Economic recession – less income of families and consequently more haggling. Big social tradition of wine producing.
Lux. average life expectancy).3 million habitants.305%. 3.808 habitants – 1.94.5% of total population are Catholics.4% of total population. Low tolerance for change and risk . Portuguese’s are traditional and conservative.4% population were 65+ years old in 2009.17. Increase of health consciousness. Literacy . First gerontologists in the market came out 3 years ago. Population growth stands at 0. Most famous social magazines in Portugal – Caras.9% of population.1 years. 16 . Family is the foundation of the social structure. 25% of the population is covered by health systems. Portugal have about 10. % of elderly population in urban areas (44%) intermediate (23%) and rural areas (33%).78. Increasing awareness of green technologies.3 million habitants with internet access. Wikipedia Average life expectancy . Demographic aging . Relationship-based culture. Very High Human Development Index (wealth. 84. Life styles changes. Technological factors: Lack of specialized professionals in the gerontological industry. VIP e Flash.difficult to implement innovations without previous track record or history. Lack of a proper social support structures for elderly people. Bragança – 148. education.
expecting other partnerships and other suppliers’ contracts in the near future. PORTER’S 5 FORCES MODEL In order to further analyze the competition in the market. Unfortunately. it may lead to a decrease of OldCare dependence on their prices and their power. Legal factors: Less bureaucracy in administrative processes companies or to sign agreements. However. That means OldCare never says ‘NO’ to a client and customers 17 . it is extremely important for OldCare to differentiate itself from the rest by offering flexible services. Due to this stated reason. I can conclude that they have high bargaining power. easier to create Social Security supervises private institutions – OldCare for example. Suppliers OldCare has close relations with their suppliers and in general they can get cheaper prices. I can conclude that the bargaining power of suppliers is high. Thus. As customers have a diversity of places to choose from. Customers The bargaining power of our customers is by far the most important factor for the success of OldCare’s business. they still depend too much on suppliers to make their business profit as the biggest proportion of revenue comes from the sale of geriatric equipment and technical aids. it was used the ‘Porter’s Five Forces Model’ analysis.Environmental factors: New regulations.
There are many options here for the customer and the threat of substitute products is consequently high. at least until OldCare’s can make obvious their differences to the market and in the mind of customers. location. To conclude. we expect the customer bargaining power to decrease. The power from substitute services is definitively huge. even more in times of crisis. plus the compensation salaries to their employees. however new players are aware of the high competence that already exists. depending of course on many factors as size. as they are more price sensitive. Substitutes Within possible substitutes companies in the area I have considered all the others Home Support Service Companies or Domiciliary Services and IPSS’s. a lot of players will continue getting in. OldCare is relatively new in the market and has not obtained yet big recognition. Furthermore the capital investment to create a similar concept is relatively low. in order to pay for the lost funds of the Government and to get rid from the vehicles the company possess. which means that they still aren’t making use of the differentiation to really obtain competitive advantage over their competitors. The exit barrier for OldCare would be around 500€ every month until 3 years. etc. First of all. services or products. IPSS’s are increasing their number and express a big power. It is a quite easy industry to enter. The service always depends on what the clients want. Even being a different concept. I assume that since as this is the type of business with a constant grow and with a huge potential to grow. By time.will always try to negotiate the prices and conditions. team. Rivalry 18 . New players Threat of new entrants is always high.
marketing. etc. image. 19 . OldCare consider as their main competitive advantage . know-how. OldCare have a unique concept consequently there are no direct competitors. Areas of differentiation can be: service. But because not every difference is significant. Highlight: is outstandingly offered. the costs should at least be lower than the price premium it receives from the buyers. In all areas. For this moment “OldCare” concept is unique in Bragança and Northeast region of Portugal and they differentiate themselves by the service they offer and their know-how. INTERNAL ANALYSIS COMPETITIVE ADVANTAGE MODEL OF PORTER According to the Competitive Advantage Model of Porter.differentiation. performance. it should try to decrease cost. that are widely appreciated by buyers. Achieving of differentiation means that a company seeks to be unique in its industry along some dimensions. A differentiator cannot ignore its cost position. 6. Superiority: is superior to other ways of getting the same benefit. sales. a competitive strategy takes offensive action to create a defendable position in an industry in order to cope successfully with competitive forces and generate a superior Return on Investment. product. distribution. that do not affect its differentiation. it must be established to meet the following criteria: Importance: offers added value to the client.Although there is already a huge competitiveness among Gerontological services providers due to the high number and the wide range available. in the differentiation area.
Diverse revenue streams. Personal experience and know-how. Low operational costs. OldCare must make use of their main competitive advantage by offering such kind of service that could be recognized as unique in its thematic. Partnerships with MOLAFLEX® and HARTMANN®. Profitability: it must be profitable for the company. Weaknesses: 20 . Today there’s a medium high competition level among such providers of Gerontological services in Bragança and Northeast region of Portugal. Motivation and entrepreneur spirit of the team. Connection to the academic world. Research&Development of new solutions. Relation with suppliers and local authorities. Portfolio of products for sale. Exclusivity: cannot be easily copied by competitors. SWOT ANALYSIS Strengths: Flexibility. Increasing demand and sustainable answer. Accessibility: The buyer must be able to pay for it.
Threats: Increasing number of competitors. BCG MATRIX (BOSTON CONSULTING GROUP) 21 . Better communication and promotion. Get new collaborators with complementary competencies. No standard procedures. Brand awareness. Simple logistics and distributions plans. Opportunities: Quality certification. New alliances and partnerships. Expansion for new markets. Enlarge the profits margin. Stuck capital in the sales of equipment. High turnover of collaborators. Creation of new services.
Fig. 1 - Market Growth-Market Share Matrix
The BCG matrix relates to marketing. It is a simple tool for analyzing company’s business portfolio in their product life cycle. This model allowed me to prioritize which products/services within the company product mix get more financial support and attention. The BCG model is based on classification of products into four categories, based on combinations of market growth and market share, relative to the largest competitor. Each product has its product life cycle and each stage in product's life-cycle represents a different profile of risk and return. In general, a company should maintain a balanced portfolio of products. Having a balanced product portfolio includes both high-growth products as well as low-growth products. In OldCare’s case the set of services are all in the ‘Question Marks’ phase, i.e., with high growth but low market share. That’s ok as the company is quite young and the services are not yet well establish in the customers mind. OldCare’s services have to be further discover by potential clients. The marketing strategy settled on this marketing plan is to make market adopting OldCare’s services. I want this marketing plan to be able to increase the market share and consequently increasing returns. If the services don’t increase their market share quickly they may turn into to ‘Dogs’ phase. Therefore, the best way to handle question marks services is to either invest heavily in them to gain market share, to sell them, or to make a partnership with a company that has their services on the ‘Stars’ phase or a ‘Cash-Cow’. A company in the ‘Cash-Cow’ phase seems to be a good option to
make a partnership with as they usually have a solid position in the market, generating lots of cash-flows but they have a lack of innovation which can translate in their failure and eventually became a ‘Dog’. For that reason OldCare can take advantage of their innovative services and creative team by allying their services with a ‘Cash-Cow’ company by complementing each other, one providing fresh knowledge and innovative solutions, the other providing promotion channels, infrastructures and eventually capital.
GREINER GROWTH MODEL
Fig. 2 – Different organization development phases
Greiner's Growth Model is used to analyze organization development. It describes phases that organizations go through as they grow. Each growth phase is made up of a period of relatively stable growth, followed by a "crisis" when a major organizational change is needed if the company wants to continue growing. OldCare is in the ‘creativity’ phase as they still are reacting to the feedback of the market to settle their services. It is characteristic from this phase that a 23
company constantly needs to add new employees. Management is focus on make & sell, the organization structure is informal, entrepreneur actions take place, no reports or written standards are produced, there is not a cost center and communication inside the organization is frequent and straight. This model is useful to predict and eventually prepare a company for what is going to happen in the future if continue to grow is the choice. Because of this reason I predict OldCare’s first and next crisis will be the ‘leadership crisis’. The word "crisis" is nothing less than a "turning point”. OldCare may prepare itself to convert in a functional organization, where an accounting system is needed, new IT systems, new people, manufacturing procedures, and the most important, centralized direction where professional management is needed. The founders may change their style and take on this role, but often someone new will be brought in.
VALUE CHAIN ANALYSIS
The production of a good or service consists of a chain of activities, each one with a different cost structure determined by different cost drivers. This added value line of production can be called Value Chain.
It requires understanding the chain of processes involved in the transformation of inputs into outputs and its delivery to the customer. ‘Marketing and Sales’ . even though domiciliary service is the core business of the company. which are only provided by specialists in health technologies with training in aging. ‘Sales of geriatric Equipment’ and ‘Physiotherapy’ represents the services that produce more revenues for OldCare. distribution and communication of OldCare’s image and brand.will be the promotion. It is very important in the current competitive business environment to identify separate activities of the value chain. they need to devote resources.The value chain analysis not only helped me to think how does each activity benefits the customer as it allowed me to settled OldCare’s main and secondary services and activities and to define in which activity OldCare can pursue competitive advantage. ‘Post-Service’ .developing and supporting customer service. to think and create new solutions to solve the problems related to the aging. Primary activities: The group of services ‘Domiciliary Service’. Identifying the appropriate activities is a matter of judgment. ‘Geriatric Rehabilitation’. which create new approaches and new solutions for a healthy and autonomous aging of the population and the services of domiciliary service and rehabilitation. which includes time. advertising. ‘Innovation and Development’ – as differentiation is OldCare main competitive advantage. That allowed me to conclude that the biggest competitive advantage of OldCare is differentiation. Support activities: 25 . The activities considered to give major differentiation to OldCare are Innovation & Development of new services. After this phase we should be prepared to define the contribution of each activity to the total cost of a service by identifying the cost drivers and then looking for cost-cutting opportunities. people and money.
‘Firm Infrastructure’ includes planning management. VALUE CURVE MODEL 26 . i.. 3ºAge universities. accounting. Global Management and Human Resources. money and people to produce the service. Telemedicine. By ‘Relations with Public Institutions’ I mean contacting with Town Halls. quality management. improving or renovating infrastructure.The daily basis management of the company. strategic alliances or other type of agreements that could bring benefits to the company. For ‘suppliers’ or ‘inbound logistic’ I am referring to purchasing from suppliers: geriatric equipment. legal. finance. public affairs. organizations or even other Institutions whose activity is related with the elderly to find potential partnerships. training supporting customer service and excellence. where the company invests more resources as time.e. maintaining OldCare’s philosophy. learning process. ‘Formation or Training. retention and compensation of employees and managers. Consultancy’ are all the other services provided by OldCare that are not core-services. Old-Sitting. the activities associated with recruiting. technical aids and either food & beverage for the domiciliary service. development and training of employees. It also includes finding the best suppliers in terms of quality and price or retaining the existing ones and finding the best communication channels for OldCare’s promotion.
managers face the challenge of finding ways to differentiate their services. 3 – Value Proposition identification . In the end of an analysis to the Value Curve Model we must be able to find out which is the value proposition of the company. Flexibility. As markets progress over time. more publicity and promotion will be made and consequently the brand awareness is expected to increase. For now. what is necessary to do. Thus. I discovered that the value proposition of OldCare’s global services is Quality. Right after. Portugal (July 2010) In an increasingly competitive environment. Customization and innovation. the brand awareness that have in the market is still unsatisfactory. These can be features. The Value Curve Model uses a diagram to compare services on a range of factors by rating them on a scale from low to high. benefits or ways in which a product is distributed or consumed. The combination of these various factors defines the service. they split into multiple segments and it can be difficult to determine which factors are of most importance to customers. It is expected changes in this level as OldCare is going to expand to new markets and as a result. 27 . Other factor that OldCare needs to review is the capacity or number of clients they can work with. this point is expected to increase during the expansion. is to put ourselves the questions: ‘Will customers want this? Can we afford this?’. Due to the fact that OldCare is a quite young company. and then identify possible gaps in our value proposition and then make changes in our service that considerably change our value preposition to continually better adapt to what customers need and want. but in general the number of clients they can handle is slightly inferior to competitors and this situation could be rethought or it may cause future problems.Fig. Once again.Comparison with main competitors in the District of Bragança. the number is small when compared with other possibilities of domiciliary service or other substitute services.
Basically. For that reason they consider that by investing time and resources in Research & Development they can find innovative solutions related with healthy aging. or directly to the health technicians of each operational area. through a phone call to the head offices in Bragança. The purpose of this innovative solution is to provide an excellent service to elder citizens by making the domiciliary service more simple and accessible to the needs of each family. through competitive prices. they will take to the client’s home a qualified professional to carry out an ‘assessment visit’ to evaluate and design the best plan of care and assistance that complements the geriatric necessities of the customer. which can bring added value to the existing services by complementing them. R&D&I As it was explained before differentiation is the main competitive advantage of OldCare. 29 . A brand new solution being developed by OldCare is the ‘OldCare TeleSupport Service’.7.
As they are all companies with relative brand awareness it makes OldCare name more visible to the market in general. in which OldCare either receives commission for the sell. ALLIANCES AND OUTSOURCING OldCare has some partnerships and strategic alliances with other companies that in on the whole make the value proposition of OldCare more interesting. cheaper prices or OldCare can use their logos to promote both companies together. They have a strategic alliance with a Nursing Clinic who provides between others palliative services to the clients of OldCare. OldCare establish some partnerships of commissions with certain companies. Besides that. They are a team of professionals with competencies in this field that OldCare opted to Outsource as it is not their main competencies.8. AGREEMENTS. The referred companies and its average % of profit to OldCare is described in the following image: 30 .
31 . Each of these five cities would be someone responsible. Aveiro. Vila Real and Braga plus the current one which is Bragança.Fig. EXPANSION PLAN OldCare aims to create a shaft support in the entire area in the North territory of Portugal which would include main cities as Guarda. 9. Porto. that for the case could correspond to the existing professionals of OldCare. 4 – Agreements and Partnerships of OldCare. which would produce the work of technical director of one operational center and be the commercial of OldCare in that same area.
promoting and communicating the company to potential target customers. in order to have a better image of the needs of the population in each area. In collaboration with local authorities. and its surrounding areas. pharmacies. and be responsible for the creation of a Client Database on its operational area. Parish Councils. its services and specially the domiciliary service. Municipal Councils and Community in general. on existing companies and social responses for the elderly.Those people would have the task of representing OldCare brand. it may be possible to organize free health screening and formations for the community so as to promote the company. Current Intervention Area 32 . Each new operational center director would be as well responsible for doing research on statistics. and then procedure to the settlement of the most appropriate services to deliver on that area. such as nursing homes. finding contacts and new agreements.
Current Intervention área – district of Bragança Right now the intervention area where OldCare is operating includes Bragança. Miranda do Douro. Torre de Moncorvo. Porto. Macedo de Cavaleiros and Vila Flor. Mogadouro. Mirandela. Vinhais.Plan of Expansion – Operational areas of Vila Real. 5 . The expansion plan suggests four new Operational Areas which includes all the bigger cities from the North territory of Portugal which in turn represents the 33 . Aveiro and Guarda. 6 . Expansion Plan Proposal Fig.Fig.
Marco de Canaveses and Lamego. as well as Bragança. Barcelos. 34 . OC3-Porto. Mangualde. Vila do Conde.Moimenta da Beira. Estarreja. OC4 – GUARDA (Ludovina Marques – Gerontologist). Ovar and Santa Maria da Feira. OC5. Maia. OC2 – VILA REAL (Diogo Tristão – Gerontologist). OC3 – PÓVOA DE VARZIM (Patrícia Correia – Nurse). Oliveira de Azeméis. – BRAGANÇA (João Matos – Expert in Clinical Analysis and Public Health). Ílhavo.Aveiro. Celorico. Viana do Castelo e Póvoa de Varzim. Albergaria-a-velha. Matosinhos. Amarante. Development Team Proposal OC1 – BRAGANÇA (Márcio Vara – Health Services Manager and Gerontologist). Águeda. Guimarães. Viseu. OC4. Braga. The expansion plan would have the following dimension: OC2 – Vila Pouca de Aguiar. OC5 – AVEIRO (Someone exterior to the company that would have to be hired) – I believe it wouldn’t be difficult to find someone to became responsible for the OC5 as Aveiro is another city in Portugal where Gerontologists are being trained.biggest focus of elder population and for that reason should be the place to invest. Esposende. Chaves. Trancoso and Guarda. Santo Tirso.
community Presentation training plans. just visit and evaluation in the clients home. Local media. Health Screenings. Find at least two private Web tools. BIOHEALTHY GERIATRIC PARKS NURSING SERVICES (Exclusive in OC3) Sell one park in each two months. families. TECHNICAL AIDS & GERIATRIC EQUIP. Residences. IPPS’s or Catalogs. in Appointing evaluation domiciliary visits according to the headquarters availability. Partnerships public-private between municipalities and IPSS’s Face contact and by catalog. of social TRAINING Sell at least one for month. Finding collaborators. Communication local media. potencial clients every sonsumers. media. 35 . Agreements.Implementation Typologies for the Operational Centres (OC’s) WHAT OBJECTIVES WHO HOW DOMICILIAR Y SERVICE Communicate and provide the 65+ domiciliary service in years OC’s without creation of a fix office. month. Communicate the nursing service for the domiciliary service Community through their own 24h phone line. client Elderly care institutions. Communication Channels. Free health screenings for the community. Create a database. Create a database. client Elderly Face contact.
Know when to delegate. Stimulate the sense of common objectives. Motivate employees by letting them cooperate in company decisions. Promote effective communication inside the company. duties and responsibilities. Offer competitive salaries or compensate with other benefits. Create motivating objectives.Success keys for expansion: Careful recruitment of employees with compatible values in order to create a excellent operational team. Be updated on new practices. Constant development of the professionals through internal formations and training. Good management work in innovating job tasks and organizational structure. 36 . Create incentive packages to employees. new solutions. Clarify working processes. Create a fair and pleasant work environment. new competitors and new potential clients.
2. and after detecting the relevant strengths and opportunities of OldCare. As a result of a simple organization 37 .1 Marketing Plan Objectives This marketing plan have as objectives to delineate a marketing strategy that fits with the expansion plan. we are now able to design a better competitive advantage and to fight against our weaknesses and threats as well. Having done the internal and external analysis.2. Márcio Vara. The most important parts of the project was to find new markets to expand and the optimization of OldCare core services in order to become more profitable and afterward give suggestions to fill those gaps. Based on this analysis we defined the market opportunity for OldCare. decision-making The chairman and CEO. 9. is the one responsible for the decisionmaking in OldCare daily-basis operations. Management style. The reason behind these objectives is because we believe the market has potential to grow more and because OldCare services are very wide and can become even more attractive through light strategic changes.1 Current position OldCare has entered his second year of operations after its fast but reluctant opening last July 2009 as a Gerontological Services provider in the Northeast region of Portugal.10. to help OldCare in the development of a strategy to grow his market share and exploring new opportunities for OldCare to enter different markets and target new segments. 9. 9. MARKETING PLAN 10.2.2 Internal Analysis 9.
A N. Telemedicine 38 . Nevertheless. Previous Results Jan Domiciliar y Service Others Feb March April 5432.1. other SAD’s (Domiciliary Services Providers) and elderly residences. by making agreements and strategic alliances with public authorities.. 9. 9.75 10803.49 5229.1.15 10600. Psychic and Physical Intervention.65 * All the figures are expressed in euros.53 10310. elderly universities. Geriatric physiotherapy and Rehabilitation. associations. directly from top to bottom. NGO’s. etc. Nursing. 3 Service Assistants and a Therapist 9. Staff The basic staff of OldCare counts with a 4 Gerontologists.e. 9.22 May 5595. Leisure Activities.184.108.40.206 11345.3. Portfolio analysis. Entertainment and Free-times. 1 Nurse. 1 Public Healthcare & Clinic Analysis Technician. public institutions. the owner is analyzing the possibility to wire a commercial responsible for taking care of the publicity and commercialization of the products and services of the company inside and outside the district where they are operating.3. image and positioning OldCare offers a wide variety of services as domiciliary service.54 5328.structure the orders are given directly to his employees’ i. Marketing Strategy 9. companies. Organization and operation There is not a clear marketing strategy and there’s not a defined person responsible for marketing campaign.42 N. Oldsitting. Attendance.04 July 5086.3.2.A 11014.44 11686.19 Jun 5763.
Service. medical centres. 39 . 9.2. 9. associations. OldCare positions itself as a flexible provider of quality and customized gerontological services.3. image put across. promotion channels. It is possible for the customer to request an evaluation visit from an OldCare Gerontogist where both will design the best plan of care and assistance that complements the necessities of the customer. the prices of follow-up plans and their consequent actions are almost all the times negotiated between the client and the company as the nature of treatments and services provides are very personalized and depends on the distance to the head offices. trustful and with very accessible prices. They distribute flyers in institutions of the area such as hospitals. Although there is a price list of the services. Consultancy Service.Pricing policy: price formation. The image customers have of OldCare is of an innovative company. They always try to say “yes” to everyone but never say “no” to nobody. Bio-Healthy Geriatric Parks. total financial volume The awareness of company is done by word-of-mouth and the promotion of the name ‘OldCare’ is being done in some regional newspapers. Training and Formation. The price of sale of geriatric equipment is fixed but the rental conditions can be negotiated according to the time of use(less or more than 1 year) and type of equipments.3. etc. Sale and Rental of Geriatric Furniture. sales conditions The price charged for the domiciliary service is slightly below the average of the district of Bragança.3. . Promotion and communication policy: market coverage.
1 Market Analysis 9.4. 40 . Besides that. Although OldCare has been investing from 5% to 10% of their sales to invest in publicity.4.4. 9. EXTERNAL ANALYSIS 9. Vila Real. Size and development The size of the potential market is very big and optimistic. there is a possibility of attracting different customers and not just one narrow type of client. the name OldCare can be suggested due to the fact of some SA’s made with companies of the area. it is my opinion that so far the effort being made to promote OldCare’s brand and services outside is very limited and that’s why there’s not that many market coverage and consequently the image put across could have been even more powerful.1. Guarda e Braga. namely the in the districts of Bragança.They have their own internet website and they are still present in the social media tool facebook.1. They are also thinking in creating health screenings for the population together with local authorities with the objective of promoting themselves in a personalized way next to their target clients and at the same time by promoting the social responsibility of the company. The company expects to launch soon a promotional campaign in a free publishing journal that is present in the north region of Portugal. They are preparing a bimonthly newsletter that is going to be sent by email to the database of the company which should be updated all the time with the clients’ folder of each collaborator. According to the fact that OldCare offers a wide range of services.
9. As the people are getting older and fewer children are born we are assisting to a demographic aging of the population. People are becoming more aware of the importance of creating retirement and health funds in order to guarantee their quality of life after an entire life of work. Trends In the next decade about 30% of the Portuguese population will be 65+ years. A new trend that gerontological industry has to take into consideration is the fact that old people and their families nowadays are looking more and more for 41 .1. Consequently the average life expectancy (ALE) is increasing. Health consciousness is changing.4. 9. 9. Right now there are a lot of elders waiting for getting in elderly residences where in general the conditions are miserable. Definitively Portugal needs to adapt their social structures to respond to this increasing number of elders.1.4. after retirement.4.1. Decision making process The customers are making their decision to choose OldCare’s services depending on the flexibility of the services and their prices. The nature of the business is resulting in relatively fix structure of sales and costs through all the year.2.3.In addition to that it is possible to create and develop new strategic alliances with other companies which can provide us complementary services and bring even more different customers. and there’s a lack of trained people and specialists to take care of this segment of the population.4. Seasonality This type of business isn’t influenced by a high degree of seasonality.
OldCare ended up with the following: Habitants of Bragança.4. etc.5. this new trend can become a competitive advantage since they offer a customized Domiciliary Service and a set of other complementary services provided by a team of professionals all specialized in health and/or with training in gerontology.1. washing their clothes. From OldCare’s point of view. Pulling out elder people from their homes and throw them to Elderly Residences is a reality that soon will be over because those residences are completely full and queued. OldCare segmented their market by: Geography Age Disposable income Life cycle Type of client After deciding the variables that they are going to use so as to segment their market. Besides. 9. skin and hair care. 42 . maintaining the house or doing small structural arrangements.someone who can take care of the elders in their homes. As a result. on the objectives and values of OldCare and also on the trends in the marketplace. someone who can be responsible for the elders in a personal level by doing their food. it is also important for Portuguese society to keep relations inside the family and avoid the break between the elder and his family. Accordingly. helping them dress. Segmentation and target market The process of segmenting the market has been done based on the market characteristics. surroundings and Northeast region of Portugal. they decided to focus on the markets that best match the value proposition of OldCare. They are going to target different groups according to the service provided. taking care of their personal hygiene.
the Home Instead Senior Care network has been devoted to providing the highest-quality senior home care. etc) 9. New Zealand. Analysis of the competition As a result of the past couple years of increasing competition in gerontological industry the only way to differentiate a company and to occupy their own place in the market is to think in innovations in order to obtain a competitive advantage. They have hundreds of partners to whom they send their clients when they need any aging43 . South Korea. Local institutions (elderly residences. Japan. People with support needs on a personal level but not in total dependence. Portugal. Loyal and moderate customers.2. Taiwan. Australia. 9.2. Home Instead is currently working under 800 franchise offices throughout the world in countries as United States. Ireland. Finding out a specific niche has become a necessity that would guaranty the success. People on retirement. third-age universities. Canada. People of medium disposable income? People 60+ years old. United Kingdom. Germany.4. Switzerland.4. Main competitors and their characteristics. local governments.1 Competitive structure. Finland and Austria. According to my research the competitors that OldCare faces in the market in Bragança and Northeast region of Portugal are the following: HOME INSTEAD Operating since 1994.
Quality SAD has been more worried in copying OldCare services than in investing in their own innovations. family and community and protection of the elders in their aging and disease. as there are a big awareness of their services in the market and due to their broader presence and cheap prices.The Home Instead Senior Care network's mission is a passion to be the world's trusted source of companionship and home care for seniors. such as health.related medical needs that goes beyond their home care capabilities. Competitive forces: entry and exit barriers. pressure from substitute products. Their services include support for children and youth. 44 . EXTERNAL ANALYSIS. VARIOUS (GROUP OF SEVERAL IPSS’S) A group of particular and non-profit institutions that have an extensive presence in Bragança and Northeast region of Portugal.4. It was opened half a year ago in Bragança as a result of a similar project to OldCare’s. Don’t have the same brand power and alliances as OldCare and as a result it has been a market follower. Despite Home Instead recognition worldwide is unquestionable their franchise in Bragança has not been seen as a good senior care services provider. It is a reality that people still look for cheap prices instead of quality. Their target market is broader as they provide services in diverse fields.2. education and solving problems of the population.2. they steal a lot of potential clients from OldCare. QUALITY SAD Same concept of OldCare of In-home support service. It begun operating under the direction of an Gerontologist and it has been growing slow. They are regulated by the social security. 9. Although their activity is quite different from OldCare’s. negotiating power of suppliers and customers See the Five Forces Model of Porter in the point number 5.
EXTERNAL ANALYSIS – PESTEL ANALYSIS 9. It is also necessary to take in consideration people that will show up in order to get to know the place and the services and then will consume.220.127.116.11.4.9. Habits and stages of the purchase decision process The main habit is people coming to OldCare because they heard something from friends and familiars or were recommended by other institutions. Determination of the market opportunity 45 . There are as well a considerable percentage of people that just saw the name ‘OldCare’ at some place and they go there to pick information later on.5. 9.4. because a familiar or a friend needs. External Business Environment (PEST Analysis) See as well topic number 5. Marketing objectives 9.5. Consumer analysis geography age disposable income Services chosen life cycle type of client 9.4.
Márcio Vara has indentified a new market opportunity where the concept of quality and flexibility can be linked and not being provided by the competitors. 46 . Objectives In order to achieve the overall objectives for this project and measure the effectiveness of the communication the following objectives were established: Qualitative objectives To create awareness to OldCare. OldCare has everything different. 9. The importance of this graph is to see the market opportunity and how different OldCare is. that is what makes them being a new and unique concept. which means that the offer they have is the same as any other domiciliary aid service with a wider and innovative range of services. at least not in the same way that OldCare does it. as it is important to let everyone knows what is this company purpose and inform about their services.5. Exhibit 7 – Service Market Positioning Map The map above shows how much different OldCare is from their main competitors and from the ordinary concept of domiciliary aid service according to Quality and Flexibility.2. Moreover.
9. To create a clear and exclusive image. Create “buzz” around OldCare’s name by using creative approaches. Adapt desirable features for the every kind of target customer. with the use of selective communication channels in line with the overall objectives of the project. Ensure that all decisions make long-term economic sense. Those factors are the following: Taking advantage of the different services of the company so as to attract different customers and not be dependent just from one type of client. Critical Success Factors There are some factors that are critical for the success of this business plan. Quantitative objectives In order to set realistic goals for the next semesters it is necessary to forecast by using the experience of the owner. Continue with a low cost structure. Keep expanding and enlarge relations by signing new partnerships and strategic alliances.6. To double the revenue of the 1º semester 2010 in the next year. Maintain a clear mission and vision. Effectively communicate the values and objectives to the employees. 47 .
7. 48 . all those ideas were thought to. 9. more than creating direct demand. it is presented the analysis of the new marketing mix suggested. theatre. SPA’s. sports – “Grandparents and grandchildrens race”) Alliances or Parnerships with STAR companies – to put OldCare’s logo on their space(Health image. 9. For more details about the services see the point 9. Travel Agencies) To conclude.1. the biggest objective is to create brand awareness.Through the new strategy we will try to increase the revenue of OldCare in three ways. Sport Centers. Each service is intending to match each different type of need. Organize Elderly excursions Organize Elderly Meetings (dance.7 – Marketing Mix Following.7. music.2 New ideas VIP Card Treatment Packages Screenings to the population in the OldCare’s Space or organized by OldCare Patronize (support) Sport Events. secondly by developing the existing services provided so as enhance sales and satisfy its customers' desires and finally by delineating a marketing strategy complementary with the expansion so that it attracts more customers and increase the brand awareness in the new operational centers. and consequently increase revenue in a long-term period. This new concept is mainly a multi-purpose Home Support Service that mixes a wide range of offers for a full-size variety of needs of the elder population. First by expanding the services so as to develop their market. Definition of the product concept OldCare is an innovative concept of Domiciliary Service.
the new website could be constantly adapted with all different kinds of events being organized by OldCare or events where OldCare is going to be present. agreement with the company provider) 9. Install a Bio-Healthy Park in the OldCare’s space (so that it can be seen from the exterior. the value the customer attaches to the service and of course. After considering the prices of the general set of services of OldCare. by implementing a penetrate price positioning.7. Firstly it would create a clearer picture in the mind of potential customers about what exactly OldCare stands for. Price The pricing strategy was decided taking into consideration the costs of the company.7. people that already know OldCare could be all the time informed about all those news. Newsletter (monthly) OldCare T-shirts – distribution to the existing clients .4. As a result.Some additional details that could make a difference Birthday Postals for the existing clients. they could not be able to make good margins and 49 . Branding Improve Website – create a forum and improvement of the general aspect of the website. it was decided that any change of the prices would not have desirable results. OldCare objectives. During the expansion.Way to increase awareness of the brand and bring more families to their facilities.3. One of OldCare’s objectives is to increase the revenue and to get higher margins than the ones reached in the first year of operations. Moreover. 9.
as the difference in the power or purchasing does not diverge much from one operational center to another.7. Promotion through Sports Academies. VIP card) Word of mouth communication through Social Media Social Media Based on nowadays critical role of social media. Promotion The overall goal of OldCare’s promotional program is to create more public awareness through various promotional tools that will result in increased demand. Live Shows of music. Of course. it has to be analyzed which segment is going to be addressed with the lunch of each new idea. 9. Travel Agencies Constantly updating the website with anything that will be organized (Health Screenings. For that reason. in order to have a successful promotion. 50 .5. SPA’s. All promotional tools that are here suggested will target current customers and potential ones as well. Sport Leisure Races. theatre and dance) Special offers (Discounts. Packages. Obviously it is not intended to target the elders directly as they are not the main users of Internet but to target their families. we decided to emphasize on this promotional tool. which are the one that in the end take the decision to find a Home Support Service.by setting higher prices than the ones they have. Advertisement in free news papers and local magazines (For each new operational area). we considered to be appropriate maintaining the prices they already practice in the first operational center. Health clinics. they would have the risk of creating the feeling of bad value for money to any potential customer.
Special offers (Discounts. Services Package – Domiciliary Service + Technical Aids Equipments = free TCare device.7 People The employees of OldCare should represent the desired culture of the business. Customers will be encouraged to become fans of those social media and then to share information with their friends.7. In addition. Besides.7. Interaction between employees and customers is an essential element of OldCare’s image. 9. the client can do his reservation through phone service. 51 . any special event organized by OldCare would be posted on the pages above so every potential customer would be informed. training the employees to adopt this kind of serving style would not be difficult due to the small number of employees. Of course. Place OldCare’s services can not only be distributed in OldCare’s headquarters as they can be provided in the clients home. and Twitter page with links to the website and shortened versions of its posts. Thus. public spaces or private institutions.6. Packages. depending how the client wants. VIP card) Discount “2x1 During one incredible month experience” – for target elder couples.The idea is that OldCare could establish a Facebook. employees should be reinforced to make this clear to every customer and creating and transmitting a peaceful energy for them. 9.
Customer's service has to be done in a familiar way so as to make the guest acquiring the feeling of a comfy place. although not figure it out exactly. seems very reasonable since the benefits it would bring.7.8 Physical environment The elements that would complete the OldCare’s value proposition are the following: Lightening – facilities in OldCare should be enlightened to transmit calm. Activities and New Ideas. innovative and caring management. The main objective of this schedule is to guide OldCare in the process of implementing. 52 . sustainability and a stronger position to face future years since the project OldCare was thought to be a long investment by his owner Márcio Vara. 6.8. would amortize the investment in a short-time period and in addition to that. I believe they would give OldCare more reliability. Comfort – facilities in OldCare should offer comfort for customers 6. 7. by knowing exactly when they should start preparing and allocating the necessary resources to put them in practice.The existing management style is exactly the one that comes from the culture of OldCare and that can help in the employees' training procedure as it is a dynamic. Implementation Time may be specified on a relative scale rather than specific calendar dates. Budget The total amount of investment necessary. It should be created three different areas for implementation that includes Promotion.
for example. If that happen. Besides. the sale of geriatric equipment. to complement their full service. as there are a lot of them specialized in this type of selling and OldCare’s mains competencies and values are related with health and caring about people.7. it is my opinion that OldCare should keep their core service the domiciliary service and not. For that reason I suggest OldCare to continue invest in their growth focusing on the domiciliary service and use the other services like Sales. adapt desirable features for every kind of target customer and communicate effectively the values and objectives to their employees. Control Critical success factors OldCare should take advantage of the different services of the company so as to attract different customers and not depend so a lot in just one type. they would probably lose market to other companies. 53 .
the certification of Quality Management System of a company is the recognition by an external and independent entity of whether the company meets in an effective way the client exigencies and the legal and regulatory requirements. Worldwide recognition. Increase confidence. QUALITY MANAGEMENT When a customer pays for product he wants guarantees that a company is capable of meeting his quality requirements. a commitment to quality is a winning attitude. Prestige. Greater control of non quality costs and its reduce. Increased customer satisfaction. The main objective of ISO 9001 is customer satisfaction. Increase motivation of employees.11. For that reason. Objectives of the implementation of a Quality System Among others the objectives to be achieved when implementing a Quality System are: Penetration into new markets. Becoming part of the list of leading companies in the world market. Reorganization of the company. to the extent that quality is the key factor in a long and successful relationship between organization and the customers. Thus. or safeguarding of the existing ones. internally and externally in the working methods. now and in the future. as can be seen in the following diagram: 54 .
on practice the implementation of a Quality Management System goes through three stages: Document what you do.000€. Moreover. 55 . Do what is documented. This certification of quality it is an opportunity for OldCare to differentiate even more from their competitors and to obtain more recognition and awareness in the market.Implement the previous methodologies. The only opposition to this certification is the fact that is not accessible to all the companies with prices around 16. Record what was done. Act – Put in practice measures to improve the process / product.Fig. I believe that by implementing the ISO 9001 standard certification OldCare could definitively ensure their further success in the marketplace and establish a more powerful identity in the customers mind. Check . The practical application of this standard is of great importance for the success of a business and the evolution of a company and the services they provide.setting objectives and methodologies in order to achieve customer satisfaction.Monitoring and measuring the processes / products and then reporting the results. 8– Main phases of the Process of Quality Certification by the standard ISO 9001 How does the implementation works: Planning . Do .
18 12130.9 15.96 17.17 38644.7 5 47958.00 2ºSem 2010 2011 12% increase in equipm.92 27051.17 24324.45 € 7€ 1€ € 19% 100% 17% 100% 56 12% 100% 8% 100% .561.67 29360. Sales.812.64 Expansion Investements (marketing) 30% Interest rate No dividens Non-Operating Expenses 3388.91 127481.82 5082.94 2.52 82390.92 49640.00 -Sale of equipment -Service delivery Cost of 25% average goods increase sold Gross Margin Operating Expenses Operating Profits 6525.37 154575.53 7048. INCOME STATEMENT DEC 2009 Net Operating Revenues 13825.12 217578.29 12881. Below you can find financial ratios and financial statements such as income statement and balance sheet of the company OldCare for the first semester of 2010 as well as forecasts for the second semester of 2010 and year 2011.60 90097.53 106285.552.58 88732.7 20.75 53655.0 5 260861. FINANCIAL PLAN 12.04 52874. 26% increase in services provided Forecast Forecast 135265.33 22589.66 1694.31 60736.8 3 67589.22 117230.00 7300.026.00 1ºSem 2010 101613.12.35 EBIT Net Income NET MARGIN (%) Retention Ratio (%) 3659.41 25763.75 50087.24 18034.59 43282.
1 90936.00 66039.6 37% 2.01 0.66 State and other public entities 323.00 63909.64 4626.13 The figures above show a good financial performance of OldCare.88 TOTAL ASSETS LIABILITIES + EQUITY Clients c/c Accrued expenses 27500. BALANCE SHEET new equipment.12 0.00 70773.21 28875.75 979.63 16138.60 34876.60 1449.80 3213.80 66729.06 60773. 57 .36 19366.1 26% 1.77 1 129773.02 34461.64 5320.20 0.00 4895.21 2.00 510.65 81006.08 27026. office.90 Bank deposits Inventory 13448.0 32% Acquisition of a van.68 63392.27 3.34 1995.34 Non current liabilities TOTAL LIABILITIES EQUITY 31990.05 7.20 970.36 16138.00 5313.62 380.34 1140.02 33085.40 109569.58 30318.00 960.97 42839. ASSETS Clients c/c Cash and equivalents 2098.46 28651.09 3373.00 9791.23 2.ASSET TURNOVER ROA (Return Assets) LEVERAGE ROE (Return Equity) on on 0.4 63% 1.50 101006.22 1403.23 0.82 Property and equipment 51072.43 66381.00 State and other public entities 3263.01 1197.00 979.00 9791.20 970.40 10000.00 4405.
without more credit help.000€ with a good margin of profits and the forecasts for the second half of 2010 are quite good as well. The net margin is also quite optimistic and the reason to be declining is because OldCare have been making investments in the first half of 2010 and more are expected to the second half of 2010 and next year of 2011 as the expansion plan requires more cost and investments. as the return of the investment has been very stable and rather high for a new company. OldCare credited all their earnings to retained earnings in 2009 and they will do the same in the second half of 2010 in order to have sufficient funds to invest in the expansion by natural growth.In the first semester of 2010 OldCare’s revenues surpassed the barrier of 100. 58 . i.e. Analysing figures in detail: The Retention Ratio indicates the percentage of a company's earnings that are not paid out in dividends. The Return on Equity Ratio (ROE) shows an excellent picture of the company for the potential investors. The Asset Turnover Ratio indicates OldCare efficiency management to generate sales through investments in their assets. Since the beginning of 2010 this ratio has been decreasing because the capacity of OldCare to finance their assets with their own capital is increasing. even if it increases our ROE when is maximized. For the future. Obviously. this ratio predicts a very high performance. the expansion of the business so far could just be possible with bank credit help that’s why the Leverage Ratio until December 2009 is so high in the figures above. The challenge of financial leverage is to strike a prudent balance between the benefits and cost of debt financing.
as they have been receiving some proposals to do that. as the professionals just can go to the next client when they are done with the first one. Other possibility that has been questioned is the possibility of creating a franchising network.Financial Strategy To accomplish the goal of expanding to all the North Region of Portugal by creating four new Operational Centres. external capital will be required. the franchisee would have to fit with the same values and objectives of OldCare. four new offices in each operational centre. and so on. As OldCare is quite young company. and this learning process implies repetition in order to decrease the time wasted in providing a service. more fixed costs. which activities are more profitable as the most important experiencebased source of cost reduction is learning. which could be a little bit difficult in. By deciding to do that. Although OldCare has good capital funds for natural growth. it is not sufficient if in the end they choose to create as well. OldCare is either interested in finding new financial investors or finding business partners. 59 . The time taken by a service to be provided is the bottle neck of OldCare. Consequently. this could be a great possibility for a near future. for example. Nevertheless. Just after doing this analysis of the operation of each task it can be possible to reorganize processes and become more efficient and then settle ‘standards’. as right now there are not that many professionals in this field in Portugal. as favourable conditions will soon came out. licensees. which is practically impossible due to the fact that OldCare provides a very customized service and all depends on what the customer wants. they still need to define which costs aren’t producing revenues. it will involve higher investments in buildings. when wiring specialists of gerontology and health or with training in aging. From our point of view this last option is not the most appropriate right now because creating a franchising requires standard operations and a clear cost structure and OldCare hasn’t been able so far to accomplish these requirements. eventually more vans. Furthermore. more equipments. more advertisement.
I present you this new concept of providing services in order to be able to fill the deficiency most frequently experienced by elder people. and basic equipment. This option would keep away the heavy costs of refurbishment and licensees. With the project present on these pages. Therefore. I want this marketing plan to be able to increase the market share and consequently increasing returns. I strongly believe I transmit that this innovative concept of home assistance service is a feasible alternative and could even become the ideal response in meeting the needs of the elderly.000€. I provide a business plan where I analyzed and reviewed all the important points of the company and finally outlined an expansion plan and related marketing strategy. Aging is an important stage in the life of an individual and requires special needs. Other possibility is to opt for an ‘open space’ office. 13. 60 . CONCLUSION 13. a van to provide domiciliary service.The investment necessary to install a new office in a new operational centre is around 20. which includes a new office all refurbished. At the same time. licensees. in line to get those needs met. and sincerely hope that in some way I will be able to help OldCare in the achievement of their overall goals and I wish them all the success in this new stage of their life. which will be undoubtly an important and inevitable part of the growing process of this company.
BIBLIOGRAPHY LARRY. Rep May. Websites consulted: www. McGraw-HILL INTERNATIONAL EDITION 2009.consulted in 27/07/2010 http://homeinstead. 50 (4) 1972.consulted in 05/07/2010 http://stats.ipq.drcarlosrocha.com/ . Robert C.co.pt/custompage.html Countries Business Etiquettes .com. E. “Analysis for Financial Management”.consulted in 11/07/2010 (ISO - 61 .Country statistical profiles 2008 and 2009 consulted in 05/07/2010 http://www.oecd. HIGGINS.kwintessential.consulted in 11/07/2010 www.uk/resources/global-etiquette/portugal.aspx?modid=1576&pagid=3352 9001) – Quality Certification .pt/ .org/ . Greiner “Evolution and Revolution as Organizations Grow” © HBR vol. 1998.
Finally. for all that I lived and learnt.com/ .com .consulted in 27/07/2010 http://www. Márcio Vara.asp? Pagina=/Areas/Qualidade/ISO90012000&Menu=MenuQualidade consulted in 27/07/2010 http://pt.consulted in 27/07/2010 www.com/exact-sciences/engineering/493912-certifica %C3%A7%C3%A3o-da-qualidade-pela-iso/ consulted in 27/07/2010 Quality Certification - ACKNOWLEDGMENTS First of all I want to thank the owner of OldCare. for whatever.consulted in 11/07/2010 http://www. 62 . .inhomesupportservices. . for the long hours missed answering the bunch of questionnaires. by supporting me. for doing research.cebrigantina. I will never forget this incredible year.pt/inicio.com/ .au/ . www.consulted in 28/07/2010 http://www.aeportugal.com .com .National Statistical Institute of Portugal – Consulted in 12/07/2010 www.turestaurantefranquicia. thank you for the amazing teachers and remarkable Master.socialgest.ine.pt.com .quickMBA. for guiding me. the workshops and seminars.shvoong. for all the time and patience he had to provide me with all the information about the company.consulted in 28/07/2010 www. and for the sympathy and care.consulted in 26/07/2010 http://www. for the tips. I want to thank to all the people that contribute in some way for this project.maxipedia. for providing information.homenurses.consulted in 06/07/2010 www. thank you for the opportunities of networking. thank you EADA for guiding me in this new phase of my life.com. all that contribute to become a better professional and even more a better individual.
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