National Post

May 26, 2008

Nurse Next Door has slow rollout

by DEREK SANKEY, National Post

Franchising: Fielding calls from hundreds of interested buyers

When Craig Burak and Travis Tinning open the doors to their new franchise in Calgary this month, they don't expect a lot of customers to walk through the doors. As the newest franchisees for Vancouver-based home health services provider Nurse Next Door Inc., they are betting the emerging niche market of home-based health services is going to explode in the next few years.

By all accounts, the statistics favour their wager. "We all know about the shortage of [health-care] facilities, and seniors want to stay in their homes," Mr. Tinning says.

The proportion of Canadians age 65 and older is forecast to increase to an average of more than 20% of the country's population by 2026 from 12%,according to Statistics Canada.

There is also a deep personal motivation. "It was one of those epiphany moments because I was surrounded by health-care professionals most of my life and started thinking about what footprint I was leaving," Mr. Burak says.

John DeHart and Ken Sim, founders of Nurse Next Door, realized the growth potential in this business opportunity five years ago after looking at Canada's greying demographic picture and seeing a void in the market. "By performing every job as we built it, it allowed us to see what was really needed in this industry," Mr. DeHart says. That turned out to be a national, franchised network of home health services.

After having what they describe as less-than-ideal personal experiences in this field for a pregnant wife and a grandmother, they began building the foundation.

"We really spent the first five years building... a solid base before we decided to franchise," Mr. DeHart says.

The business partners travelled to Japan, India, the United States and across Canada, doing a lot of research in best-management practices, evaluating systems to create the ideal framework for a company that took several years to build before franchising.

Nurse Next Door operates a 24-hour call centre from Vancouver, from which client information gets relayed to a workforce of trained, mobile health-care workers. They charge from $100 a week for occasional help to $5,000 a month for continual care.

In the early days, Milton Wong, chairman of HSBC Asset Management, was attracted to the growth potential of the company and became an investor and chairman.
Every community in Canada is going to go through a major transformation in the next 20 years Mr. DeHart says. Which is why, he says, he is fielding calls from hundreds of interested buyers.

"We just don't understand how that will impact the country in terms of how health care is delivered," he says. "What we do know is that a lot of care will be shifted into the community [and] into the home setting."

The entrepreneurs are taking a precise and measured approach to the expansion of Nurse Next Door. The company opened one in Ottawa in July and aims to open another 20 by the end of the year. They insist they are not selling franchises, but awarding them. "We could be at 100 [locations], but that's not the point," Mr. Sim says. "You are awarded one and you have to meet a certain set of criteria."

Mr. Sim likens it to a religious approach to building a corporate culture that brings management science into the home health services market at a time when demand is set to soar.

Competition is bound to heat up if current trends continue. Companies such as Eldercare Home Health Inc. in Toronto and its president Lisa Wiseman plan to expand significantly in coming months.

One of the biggest challenges all the companies will face is in competing for a relatively small talent pool. One creative solution Nurse Next Door uses is to try to attract stay-at-home mothers whose children are at school and who are available during peak hours -- 9 a.m. to 2 p.m. "Our intention is to hire the smile and personality and then provide them with the tools and training," Mr. Tinning says.

"We're in this for the long haul," Mr. Burak says. "If that means starting a bit slower than other people would want, that's okay." 


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