Running a care home efficiently and profitably is becoming more difficult. The sector faces unique pressures, including an aging population and increased demand for quality healthcare alongside significantly higher operating and staffing costs.  

For your care home business to succeed, you must find efficiencies whilst enhancing the quality of service.

As digital accountants, we aren’t experts at providing care home services. But we are experts at helping stretched businesses become more financially resilient, compliant, and efficient.

This blog will run through some key actions care home owners should be considering right now.

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The financial challenges facing care homes

The care home sector is very demanding, and there are plenty of ways financial headaches can develop. Some of these are experienced by most businesses, but others are unique to care homes, such as:

• Massive administrative requirements

• Fluctuations in funding from local authorities, or delayed payments

• Rising operating costs, including staffing, energy, equipment, food and drink

• Cash flow that is dependent upon occupancy rates

• High maintenance and infrastructure costs

• Stringent regulatory demands

Unlike NHS-funded institutions or large corporate chains, private care home operators may lack the safety nets and economies of scale that can cushion financial shocks or economic downturns.

So how can embracing digital accounting make life easier?

Digitising and automating your care home finances

The good news for care home owners is, despite the unique challenges you are facing, many of these can be mitigated through smart use of financial automation and digital accounting.

Here is how.

Streamline and automate your bookkeeping

When you’re dealing with potentially dozens of employees, residents and associated transactions, manual bookkeeping can be an enormous time sink. Care homes are vulnerable to administrative bloat and the valuable time it consumes.

This is time you should be spending on improving operations, training staff and providing the best care possible.

Through automation, your data will be entered and processed automatically, making your books more accurate with a fraction of the time and effort. This is essential for compliance, can boost profitability, and will also ensure you are audit ready.

Automated invoices and billing

Invoicing for care homes has the potential to get messy quite fast. Missed or late invoices mean delayed cash flow and more financial headaches.

Automation can streamline this, generating and sending invoices based on specific care plans, issue automatic reminders for overdue payments, and synchronise it all with your bank account to track receipts.

Real time cash flow tracking

Cash flow is critical for any business, but especially care homes, where staff wages, medical supply and maintenance costs can stack up quickly (and sometimes unexpectedly).  

To make matters more complicated, care home income from multiple sources can be notoriously inconsistent – this makes budgeting and forecasting difficult.

An accurate and regularly updated cash flow makes it easier to deal with various potential disruptions.  

Going digital means real-time visibility. It means you can track every penny coming in and going out of your business, analyse cash flow accurately, and predict the future with more confidence.

Compliance made easy

Care homes are heavily regulated, including HMRC, GDPR and CQC. The piles of paperwork and pressure to remain compliant can be tremendously stressful for owners.

By automating your finance function, you can keep all your records and important documents organised and accessible in an instant, and you can do it without hours of manual data entry or organisation.

Payroll automation

Payroll for care home staff can be more complex than standard 9-5 businesses. You will need to administer payroll for teams with varied shifts and contracted hours, which is both time consuming and ripe for errors when done manually at scale.

Automating your payroll pulls data from your live scheduling software, calculates taxes for you, and issues monthly or weekly pay slips automatically. It is faster, more accurate, and means staff always get paid on time.

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Interested? We can get you all set up

Gravitate is an accountancy practice built around the principles of finding efficiency through automation. Whether it’s your year-end accounts, bookkeeping, payroll, taxes or budgeting. We will set you up with the most suitable software, integrate it fully with your business operations, and save you countless hours (not to mention stress!)

From there, we can take things further. We’ll help you harness the data your business generates, helping you boost profitability and your business valuation with data-driven financial strategies.

Send us a message today if you’d like to learn more.

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