How To Write A Business Plan For A Care Home

How To Write A Business Plan For A Care Home

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Writing a comprehensive business plan is essential for the success of your care home. Following the steps that should be included in your business plan will ensure that you have researched and explored all the aspects of your new project. 

Writing a business plan for a care home should include – who are you; what will you provide; when will you implement; where will you be located; why did you select your team; and how will you finance your business venture?

Through answering these questions, potential clients and investors will have a thorough understanding of your care home. The most important component of your business plan is to assure family members that your home will meet the needs of their loved one. 

Who Are You?

How To Write A Business Plan For A Care Home

In this section of your business plan, you need to provide a succinct overview of your business. This will be the first impression that an investor or client will have of you; let your personality shine. You should write a draft of your executive summary, then complete the other sections of your plan. For your last step, revise your opening summation. 

Components that you should include in the about you section or executive summary include – 

  • Business name, location or possible locations, business model or legal structure, size of facility
  • Target market and services that will be provided
  • Timeline for implementation and startup
  • Market analysis and reasoning for location(s)
  • Management structure and bios of any people already on the team
  • Expected start up costs, revenues, and profits

These sections will be discussed in detail later in the plan. For your summary, include highlights of each area only. Your purpose is to actively engage your audience, so they want to know more about you and your care home. Use the following sections, to bring your dream to life. They are not linear in their completion. Each section will impact another, so you need to continually envision and refocus the big picture. 

What Will You Provide? 

In this section of your business plan, you will provide details about your demographics and how you will market your home to your target client base. Types of care homes to consider include –

  • Independent Living
  • Assisted Living Facility
  • Skilled Nursing Home
  • Rehabilitation Services – short- or long-term support needs to be delineated 
  • Therapy – speech, occupational, physical
  • Specialty Care
  • Hospice Support

Perhaps the care home that you are opening will have different areas to meet the needs of your clients. To fully develop the – what you will provide, consider the following –

  • Number of beds each unit
  • Types of care plans will be written
  • Methods to thoughtfully transition clients from one area to another as their needs change
  • Staffing for each area
  • Specialized equipment and rooms need
  • Dietary needs
  • Social activities
  • Therapy 
  • Mental health

Now that you have a clear picture of your clients and the type of support they will need, your business plan needs a section on marketing. For your care home, you need to determine how you will let potential clients know what you offer. Working in partnership with hospitals and other care facilities should be fully explored. 

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When Will You Implement Your Plan?

Investors and potential clients will want to understand the steps you will take to implement your great ideas. Depending on whether you are redoing an existing facility or building a new one, what to include in your implementation plan will vary. Listed here are some of the items to write about in this section of your business plan. For each, consider how long it will take to obtain or accomplish and create a timeline. 

  • Licenses and permits for building and operating
  • Federal certification for Medicare and Medicaid
  • Either an existing building or land
  • Renovations needed or construction details
  • Equipment and supplies lists and purchases
  • Marketing timeline
  • Staffing – doctors, nurses, aides, therapists, dietitians, housekeeping, etc.
  • Building census or filling the beds
  • Obtaining funding

After you detailed the steps of your timeline, determine opening day!

Your business plan should be a working and living document for you. This section will be important to continually review. Any issues with the timeline and delaying your opening will cost your investors and you money. Most importantly, services will not be available as promised for your clients. A project manager can assist you with these concerns.

Where Will You Be Located?

Determining your care home’s location will necessitate a thorough market analysis, which will be included in your business plan. An understanding of your competitors is essential for your success. You must also verify that there is a need for your facility and the size that you are planning to open. 

In your market analysis, consider including the following –

  • List of competitors
  • Services any competitors provide
  • Amenities included
  • Size of each competitor’s facility 
  • Assess the competitor’s limitations and successes
  • Pricing at each care home
  • Revenues at each competitor’s facility
  • Unmet needs in the market
  • Size of the market
  • Estimated growth or decline in the market
  • Details that are affecting the market
  • New developments or needs forecasted
  • Areas you intend to service 
  • Income ranges of your potential clients
  • Insurances, Medicare, Medicaid available in your demographic 

You also need to explore options of existing care homes, renovating a building for your care home, or finding land and constructing a building. You explored these questions in your timeline as well. Now that you have completed a market analysis, you should revisit your thoughts on location. Working with a realtor might be the best use of your time and resources. From your market analysis, you should have a better idea of your preferred location.  

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Why Did You Select Your Team?

How To Write A Business Plan For A Care Home

When writing your business plan, you might not have hired any member of your team. However, you should be able to articulate how you will hire the best people to work with your clients. Personal is a key component for success in the care industry. 

In this section, you should provide details about your own background. Focus on including the skills and traits that will enable you to successfully launch your care business. Do the same for anyone one else that you have on your team at this point. Detail who is responsible for what elements leading up to opening your business. 

Before the care home is fully operational, you need to create and include in your plan an organizational chart. After this is completed, return to your timeline, and make any necessary adjustments. 

In your organizational chart, include some of these ideas –

  • List all the departments in your organization
  • For each sector, include all positions
  • Describe the responsibilities of each position
  • Detail the background or experience, if any, needed for each role 
  • Reporting structure – who will evaluate each team member
  • Support positions, such as lawyers, accountants, startup assistance 
  • Include salary estimates for each 

How Will You Finance Your Business Venture?

With all the steps to opening your care home, there are associated costs. An important section of your business plan must include finances. All the other sections of your business plan must be reviewed. Expenses and revenues expected from your business must be estimated for each element. At the minimum, you will need a forecast of your profits and losses. A projected cash flow statement must be included along with a balance sheet.  

Since this is a new venture, you will need to include your projected startup costs in your plan. This list should only include costs that will be incurred before you open your care home. Construction or renovation costs will be part of your startup expenditures. Also, the furniture you purchase so you can open the home are included here along with all the medical equipment. Parts of these costs can also be depreciated over time and included as part of your operating costs. 

Depending on your background, it might be worth your investment to hire someone to assist you with financial estimates and taxes. 

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Frequently Asked Questions

  • What are USPs?
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USP is an acronym for Unique Selling Propositions. For your care home, explore adding USPs that will be used to distinguish your care home from competitors. Areas to investigate include your recreational offerings, medical team, and details included in each client’s room. 

  • What is a CAC?

A CAC is an abbreviation for customer acquisition cost. Included in this cost are all the steps included in admitting a new patient. Add together the fees from marketing, meetings with the client and family members, proposing care plans, purchase of any specialized equipment for the customer, and other costs.   

  • What are ADLs? 

ADLs or BADLs are the basic activities of daily living. Included in ADLs are taking care of someone’s essential physical needs. Care for one’s hygiene or cleanliness, use of the toilet, getting dressed each day, obtaining necessary nutrition, and physical movement are elements of ADLs. 

  • What are IADLs? 

IADL refers to instrumental activities of daily living. These life skills require the ability to think through more complex tasks. Typically included in IADLs are handling money, maintaining a clean home, shopping for clothing and food, preparing meals, the ability to shop, taking medications as directed, and communicating as needed. 

To learn more about how to plan your own home care business click!

Please note that the contents of this blog are for informational and entertainment purposes only and should not be construed as legal advice. Any action taken based on the information provided in this blog is solely at your own risk. Additionally, all images used in this blog are generated under the CC0 license of Creative Commons, which means they are free to use for any purpose without attribution.