🕒 Estimated reading time: 3 min.
For years, the food and beverage (F&B) sector has been a popular entry point for franchise operators. The model is familiar: strong branding, turnkey systems, predictable footfall, and the comfort of a known product. But over the past decade, the economics of running an F&B franchise have changed dramatically. Rising food costs, increasing labour expenses, energy spikes, supply chain volatility, and tighter competition have squeezed margins to levels many franchisees did not anticipate when they first invested.
At the same time, another franchise segment has been quietly—and consistently—outperforming nearly every traditional model: care franchising, specifically domiciliary and home-careoperations.
These care businesses deliver something F&B operators rarely experience: higher margins, recurring revenue, long-term client relationships, and growth that isn’t tied to consumer whims or economic cycles. And many F&B franchisees are now discovering that the operational discipline, people management skills, and leadership style they use in hospitality translate seamlessly into the care sector.
In fact, franchisees moving from F&B to care often report earning double—sometimes even triple—the profit margins they were used to, while working more predictable hours and building an asset with long-term equity value.
So the question becomes: Should more F&B franchisees diversify into care? The answer, increasingly, is yes.
This article explores why, how, and what it means for long-term growth.
The Reality: F&B Margins Are Tightening to Uncomfortable Levels
Running an F&B franchise can be rewarding, but the financial pressures are undeniable:
- Food inflation continues to push wholesale costs up.
- Labour shortages mean wage bills are higher than ever.
- Energy and utility costs fluctuate unpredictably.
- Competition is fierce, especially on the high street.
- Great footfall doesn’t guarantee high spending.
- Delivery platforms take a painful commission.
- Rents and rates keep rising.
Most franchisees report net margins between 5% and 15%, and in many cases, the number is smaller. A single store might generate high revenue but leave very little in the owner’s pocket after overheads.
Compare that to the care industry, where established home-care franchises often operate between 15% and 29% net profit margins—sometimes higher depending on efficiencies and scale. That margin difference alone creates a compelling diversification opportunity, especially for operators accustomed to managing staff-heavy environments.
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The Care Sector: Where Purpose Meets Profitability
Care franchising—particularly domiciliary care, where teams support individuals in their own homes—is one of the most resilient business models in the UK.
Here’s why:
Demand is Permanent and Growing
An ageing population, increasing chronic conditions, and a shift from residential care to home-based care means demand is rising year after year. Unlike hospitality, demand hardly fluctuates.
It’s a People Business, Not a Premises Business
There’s no expensive retail unit, no décor refurbishments, no machinery investments, and no ongoing product wastage. Overheads are dramatically lower.
Recurring, Predictable Revenue
Clients often require care multiple times a day, every day, for months or years. That creates predictable, repeating revenue—not the transactional model of food service.
Staff Retention Can Be Higher Than Hospitality
Care teams value stability, purpose, and long-term relationships with clients. Once embedded into a strong culture, they stay.
Brand Reputation Builds Faster
Word-of-mouth is powerful. When you change someone’s life for the better, families talk about it. Local authorities notice. Health professionals recommend you. That goodwill compounds.
For franchisees accustomed to transactional, customer-facing service environments, the care sector brings a breath of fresh air—operationally and financially.
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What F&B Franchisees Already Excel At—And Why It Helps in Care
Many hospitality franchisees underestimate just how transferable their skills are. In reality, F&B operators bring some of the best possible attributes to a care franchise.
They Understand Staffing Better Than Most
Managing shift workers, juggling schedules, motivating teams, training new starters—F&B operators do this daily. Care teams work in similar structures: rotas, peak times, training and onboarding, and strong leadership.
They Know How to Deliver Consistent Service
A franchise is a franchise. Following systems, maintaining brand standards, and meeting KPIs are second nature to an F&B operator. Care franchisors love franchisees with this mindset.
They Are Comfortable With Compliance
Food hygiene, audits, licensing, health and safety—F&B operators deal with compliance constantly. The care sector has higher stakes, but the structure feels familiar.
They Know How to Build Local Reputation
Marketing a local restaurant or café is not so different to marketing a care agency: community visibility, local partnerships, PR, charity involvement, networking. Hospitality operators excel in this.
They Understand Operational Margins
Because F&B margins are tight, franchisees learn to track labour cost percentage, wastage, upsell opportunities, and efficiencies. Bring that discipline into a care franchise and profitability grows quickly.
In short: almost everything that makes someone successful in food and beverage makes them exceptional in care.
The Margin Advantage: Why Care Delivers Double the Profit
The difference in profitability comes down to several core factors:
Lower Fixed Overheads
A care franchise often operates from a small office, not a prime-location retail unit. That alone can halve monthly overheads.
No Wastage
There’s no spoilage, no stock, no fluctuating costs of ingredients.
Labour Is a Revenue Generator
In F&B, labour is a cost centre. In care, labour is the service—and therefore directly tied to revenue.
Repeating Clients, Not One-Off Guests
A café may serve someone once a month. A care client may require 14 visits a week.
Higher Hourly Billing
Care providers typically charge between £25 and £35 per hour depending on region. With good scheduling and travel-time optimisation, margins grow rapidly.
Economies of Scale
Once a care agency reaches 1,000+ hours of care per week, profit accelerates without a proportional increase in expenses.
The end result? Care franchises routinely produce double the margins of F&B operations.
A Tale of Two Franchisees: A Practical Scenario
Consider two franchise operators, both investing £120,000 into their next business.
Operator A: Opens another F&B store
- Revenue: £600k per year
- Net margin: 8%
- Annual profit: £48,000
- Hours: long, evenings, weekends
- Staff turnover: high
- Overheads: rent, utilities, equipment, stock
Operator B: Starts a care franchise
- Revenue: £800k (achievable within 18–24 months)
- Net margin: 18–22%
- Annual profit: £150,000+
- Hours: mostly weekdays
- Staff turnover: manageable
- Overheads: office rent, recruitment, training
Same investment. Very different outcomes.
Why Care Franchises Suit Portfolio Builders
Many multi-unit franchisees in hospitality reach a point where adding another store doesn’t meaningfully increase personal income—it simply adds more workload and risk.
Care franchising solves this by providing:
True Portfolio Diversification
Care performs well in recessions, pandemics, and economic uncertainty. It stabilises a franchisee’s overall portfolio.
A Complement to Existing People-Management Skills
You don’t need sector experience—you need leadership experience.
Long-Term Asset Value
A successful care agency can be sold for 3–8× EBITDA, far more than most hospitality franchises.
4. A Mission-Driven Business
Many franchisees find the care sector personally fulfilling. Instead of selling calories, you’re improving lives.
Operational Differences—and How F&B Franchisees Adapt Quickly
It’s important to be realistic. The care sector is regulated. It requires quality, compassion, and compliance. You cannot simply “open the doors” and start trading. But franchising exists precisely to make this achievable for people coming from other industries.
An F&B operator needs to understand:
- The regulatory framework (CQC, inspections, safeguarding)
- Recruitment pipelines for carers
- Managing care rotas and scheduling
- Care planning and record keeping
- Local authority frameworks and private-pay marketing
But franchisors provide full training, support, and ongoing coaching. Most franchise systems also supply:
- Compliance specialists
- Registered manager recruitment assistance
- Marketing systems
- Care management software
- Step-by-step operational playbooks
Compared with the challenge of running a busy kitchen on a Saturday night, the structure of a care business often feels more controlled and strategic.
The Bigger Picture: Why Now Is the Moment to Diversify
Several macro trends make this the perfect time:
The population is ageing at the fastest pace in UK history.
Demand is structurally increasing for decades ahead.
Local authorities are outsourcing more services.
Private-sector care providers—especially franchised ones—win large amounts of contracted work.
The social care workforce is stabilising.
National recruitment campaigns, better pay, and improved working conditions are attracting more talent.
Hospitality franchise investment is riskier than ever.
Margins simply aren’t what they used to be.
Care franchises are now specifically targeting cross-industry franchisees.
Franchisors recognise the strength of F&B operators.
When opportunity, timing, and transferable skills align, diversification becomes not only smart but strategic.
Final Thought: From Serving Meals to Serving Communities
F&B franchisees are some of the most resilient, operationally savvy entrepreneurs in the country. They understand hard work, leadership, and systemised growth. But many are exhausted by shrinking margins and unpredictable trading conditions.
Care franchising provides:
- A stable business model
- Strong cashflow
- Higher profitability
- Predictable working patterns
- A meaningful contribution to society
- Long-term equity value
For franchisees seeking double the margins, better quality of life, and a future-proof business, the transition from F&B to care isn’t just logical—it’s transformational.
The next wave of top-performing care franchisees won’t come from healthcare. They’ll come from hospitality, retail, logistics, and other people-led sectors—especially food and beverage.
And if you’re an F&B operator reading this, the opportunity is already knocking.
About the Author
Richard Pakey is a franchising expert and Managing Director for the award-winning Lime Licensing Group and can be contacted in the following ways:
Email: richard@limelicensinggroup.co.uk
Mobile/text/whatsapp: 07904 697591
LinkedIn: https://www.linkedin.com/in/richard-pakey-vfp-0b46ab147
https://www.limelicensinggroup.co.uk/franchise-consultants-in-cambridgeshire/