Advisory Feb, 23 2010

Giving care garnering profits

The industry for healthcare centres is growing at a great pace with the establishment of super speciality medical centres that cater to the needs of patients. In spite of this growth, the sector involves a number of challenges for aspiring entrepreneurs.

By Ramanjit Kaur
Feature Writer
Giving care garnering profits

The wide disparity of health problems in India and rising health awareness among people has led to the emergence of the healthcare industry in a whole new way. The increasing demand for better healthcare services has led to the rise of many names in this sector, a few of which have taken the route of franchising for expansion. But being an industry dealing with people’s lives, sensitivity and seriousness should be paramount and its challenges need to be considered carefully.

To be a part of this emerging sector, you need to have good entrepreneurial skills coupled with a background in healthcare and a passion for serving humanity. As the healthcare business is a highly specialised field, therefore an entrepreneur must understand the seriousness of the profession and devote ample amount of time in establishing and running his/her healthcare franchise centre. Majority of the healthcare companies in India like Apollo Clinic, Sky Healers India Pvt. Ltd, Fortis Healthcare and few more are following the franchise route to cater to provide better healthcare facilities. Sudhir Diggikar, CEO, Apollo health and Lifestyle Ltd says, “We are constantly working on innovative ideas for customer satisfaction to introduce new practices and latest techniques for the effective treatment of various ailments.”

Guard against challenges

The highly technical nature and externalities allied with the healthcare sector often raise certain challenges for prospective franchisees. So, if you wish to take up a healthcare franchise, you need to consider the following challenges: 

  • Skilled man-power: Franchising is the only way through which an entrepreneur gets complete hand-holding in terms of the training provided to his/her staff, as the healthcare centres requires highly specialised professionals with expertise in the subject. As Sudhir Diggikar, CEO, Apollo health and Lifestyle Ltd says, “Healthcare is a people driven business but there is scarcity of enough trained manpower in India and moreover employee retention also pose a major challenge for growth.” Therefore, a franchisee is always advised to seek the help of the franchisor while recruiting the medical practitioners. 
  • Competition from unorganised players: The healthcare sector is occupied with a large number of unregistered or unorganised medical practitioners. They pose a major threat to the success of a franchisee as it becomes difficult for patients to judge the quality of a health service and accordingly change the service provider. As Diggikar says, “Healthcare though is a ‘recession proof industry’ still it is not free from challenges, the unorganised players also pose major challenges in the growth.” 
  • Difficulty in maintaining standards: As the healthcare centres deal in a number of human afflictions and their treatments, so maintaining quality in the various services offered at the franchised centre should be a primary concern for the franchisee. Therefore, he/she needs to recruit a highly efficient work force that can meet the needs of the patients and simultaneously maintain the set standards of the franchised brand.  
  • Problem in building a network: The healthcare centre cannot run successfully if an entrepreneur fails in keeping profit margins. It is possible only if the franchisee has the ability to develop a network of well qualified primary and secondary health care providers. A franchisee needs to negotiate with a qualified supplier for the bulk supply of healthcare products (drugs, equipments, contraceptives and office supplies) and services (finance, insurance). Or the franchisee can seek help from the franchisor for it.

Franchising benefits

In spite of these challenges, franchising in the healthcare sector is beneficial for the aspiring entrepreneurs as it offers immense opportunities for them. Take for instance, the franchisor typically trains his/her franchisees and their staff in technical and business administrative skills. As Diggikar says, “We also focus on getting all our laboratories to match the international standards to ensure high quality standard.” The franchisor also helps the franchisees by informing the potential clients about the availability of the franchised outlet in the nearby locality.

Overall, the healthcare industry has unlimited scope for entrepreneurs who wish to establish a business in this promising sector. A consideration of the various challenges discussed above and their evaluation at the latent stage of the franchise deal will surely spell success for a healthcare franchise.

Related: Smart franchisees convert visitors to buyers

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