Strengths
Most importantly, the demand for senior transportation services remains strong in any economic climate. This is due to the fact the elderly people will continue to need ongoing transportation from their homes to doctor’s offices, dialysis centers, for their shopping needs, as well as other personal needs. These businesses typically have highly controllable operating costs, which allows them to produce highly predictable streams of revenue on a daily basis. For doctor visits, publicly funded healthcare systems generally pay for this type of service depending on the scope of the client’s coverage. One of the other strengths related to senior transportation services is that they are able to easily scale their operations without incurring major capital expenditures. Given that these businesses maintain substantial vehicle inventories, most financial institutions are willing to extend the needed credit to either purchase or lease vehicles on an as needed basis.
Weaknesses
As senior transportation service companies are highly lucrative businesses, there is always a significant amount of competition in any market. This is especially true where there is a large population of people that are over the age of 65. To that end, these businesses need to find ways to properly differentiate themselves from other market providers. A full scale marketing plan needs to be implemented with a major focus on establishing ongoing referral relationships with doctor’s offices, clinics, hospitals, outpatient facilities, and home healthcare agencies. The initial marketing for a senior transportation service is substantial.
Opportunities
There are numerous opportunities for senior transportation companies to expand their operations. These companies can scale through organic growth by expanding marketing campaigns while concurrently acquiring additional operational assets in order to conduct growth. Additionally, these businesses can acquire existing senior transportation services that are already in operation. As discussed above, nearly all financial institutions like to provide capital to enterprises that operate within this field given their economic stability. These businesses can source business acquisition loans as well as lines of credit relatively easily.
It should be noted that many senior transportation services can expand by providing full scale ambulatory services as well. This is a slightly different business that NEMT services, but it complements these operations. This segment of operations could be a highly profitable revenue stream.
Threats
Outside of competitive matters, there are few risks associated with these businesses. Most revenue is generated from direct client payments so changes in reimbursement schedules would not overly impact a senior transportation services’ ability to generate revenue. Inflation could cause the operating costs of these businesses to increase. However, this can be remedied through increase in the per-mile rate charged to client