UK care-home procurement in 2026: quantify the non-care spend
The line that gets less attention, because it is not the biggest number on the P&L, is non-care procurement. That makes it a useful area for disciplined review.
- Staffing is roughly 60-70% of cost — the National Living Wage and employer NI changes are fixed, sector-wide, non-negotiable.
- Non-care procurement gets less attention precisely because it is not the biggest number on the P&L — yet contracts drift from market year after year.
- Stacked together, these categories can contain duplicated scope, outdated volumes or contracts not recently compared. Value must be calculated from the home's own baseline.
Staffing deserves the board's attention: the Competition and Markets Authority found staff costs equal to approximately 50% of aggregate care-home revenue in its market study. Skills for Care's 2025 data also show care workers holding 56% of filled posts in residential services without nursing. But a large staffing line does not make energy, food, laundry, cleaning, maintenance and telecoms immaterial. Sources: CMA care-homes market study and Skills for Care
Those non-care categories are more controllable than statutory wage rates, but only if the operator first creates a defensible spend baseline.
Start with the market facts, not a generic savings claim
The National Living Wage rose to £12.71 per hour in April 2026, a 4.1% increase. Employer National Insurance is 15% above the relevant threshold. Those changes are legislated. In contrast, supplier prices and contract terms can be tested.
Food and non-alcoholic beverage CPI was 1.7% in the 12 months to June 2026, while headline CPI was 2.6%. A catering supplier asking for a materially larger increase therefore needs to show the relevant ingredient, labour, freight and service components; headline CPI alone neither proves nor disproves the request. Source: Office for National Statistics
A six-category spend exhibit
Consider an illustrative annual baseline for one home:
| Category | Illustrative annual spend |
|---|---|
| Energy | £180,000 |
| Catering and food | £240,000 |
| Laundry and linen | £90,000 |
| Cleaning and hygiene | £70,000 |
| Maintenance | £120,000 |
| Telecoms and IT | £40,000 |
| Total | £740,000 |
On that baseline:
- 1% verified movement = £7,400;
- 3% = £22,200;
- 5% = £37,000.
These percentages are sensitivities, not market benchmarks or promised savings. The value of the exhibit is that it gives management a materiality threshold: a fragmented category can be worth auditing even when no single invoice looks large.
Audit the categories in the right order
Energy: contract term, meter estate, consumption profile, renewal date and pass-through charges.
Catering: price by SKU, pack size, actual volume, substitutions, rebates, waste and nutrition specification.
Laundry and linen: kilograms or items processed, minimum charges, losses, rejected items, transport and emergency service.
Cleaning and hygiene: product specification, dilution, dispensers, consumption per occupied bed and bundled equipment.
Maintenance: preventive versus reactive work, call-out rates, parts mark-up, statutory compliance and response time.
Telecoms and IT: active users, unused licences, data allowances, hardware leases and renewal clauses.
Quality, safeguarding and continuity constraints must be written before any tender. The output is then a verified supplier-savings register—not a theoretical percentage applied across the P&L.
The categories hiding in plain sight
- Energy
- Contracts signed at opening and rolled over on annual renewal
- Catering and food supply
- Priced against 2019/2021 volumes and ingredient costs
- Laundry and linen
- Externalised from day one, never revisited
- Cleaning and hygiene consumables
- Often bundled with a facilities contract, rarely benchmarked separately
- Building maintenance
- Billed for activity (hours, parts) rather than outcomes
Nothing to lose. Everything to gain.
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Mohamed A. Madani is the founder of Madani Advisory, a founder-led boutique procurement advisory firm serving C-level operators across the GCC and Europe. His background spans General Electric's Onshore Wind business, pharma, and senior GCC advisory work. $485M+ in procurement and supplier value delivered across his career.
What percentage of a care home's costs is non-care procurement?
There is no universal percentage. Build it from the home's general ledger, invoices and contracts. The £740,000 exhibit is an illustrative baseline, not a sector average.
Does a 5% scenario mean every home can save 5%?
No. On the illustrative baseline it equals £37,000, but a result can be stated only after like-for-like actions are implemented and verified in invoices.
Which category should be reviewed first?
Prioritise addressable spend, renewal timing, price movement, supplier concentration and operational risk. The largest category is not always the quickest or safest opportunity.
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