Table of Contents
Reasons for Writing a Business Plan for Private Practice
- You want to Start a Business
- You Own an Established Practice and seeking help
- You Need to Determine your Objectives
- You are Trying to Predict the Future
- You Want to Use it to Raise All the Money you will Need
A business plan creates a strategic roadmap for your business goals. You own an established practice, and you’re seeking help. So we’re in Middle Stage Practices. We’ll develop some draft plans to help them, whether it is to find growth opportunities or pivot.
Another reason might be you needed to determine the objectives. So there are so many variables in developing a business, and a business plan is an excellent way of addressing them and your future goals, projections, initiatives, et cetera.
The last one that most people already think of when I say writing your business plan. But ironically, I think it’s just a small piece of it because you want to raise money and need something to show them. So I get all the time when I say,
Hey, have you written a business plan? They look at me, and they're like, well, I'm not trying to get money.
And my statement to them is:
- How do you know where we're going?
- What are we trying to achieve?
- What are all the pieces, factors, and all the little bubbles that are up here in your head?
You know, something interesting as I teach communication a lot for clinicians and healthcare providers. I find that sometimes how we see it and feel it and believe it in our head never translates to out. So when we can voice it, write it, repeat it, review it. Suddenly, the vision all comes together, and we’re more effective with the implementation steps.
SAMPLE STRUCTURE FOR BUSINESS PLAN FOR PRIVATE PRACTICE
Section 1: Executive Summary
As we start with section one, I want you to know that this is a business plan’s sample structure. So this is one that often people use for funding, but it doesn’t have to be that way. And this is just to give you a template
In the end, you’re going to see some References and Resources of places you can go to look at different business plans. So we’re going to start with your executive summary because that’s the snapshot of your business plan?
This section will cover global and essential communication related to vision and strategy within your business plan. We want to talk about the mission statement and the necessary company information:
- When was your business formed, or when will it be formed?
- What's the founders' name, the roles, employees, locations, any growth highlights as applicable, or goals?
- How do you position the market, your products, services, and summary of opportunity?
Now, something I’ll share with you is that there are times where I will create a business plan, and I ended up shelving the business plan. Because of outside factors, the timing wasn’t right. But I have picked them up years later and been able to implement them so fast.
So even if this is just a phase where you’re in idea mode, get it all out of you. Write the business plan as a journal of imagination structure and pushing you to research where you’re going to go with this vision.
Section 2: Company Description
The next section, when writing a Business Plan for Private Practice, is your Company Description. You know, in many cases, you’re going to be in a service-based business model. You’re delivering healthcare; maybe you’re not. Maybe it’s something related to healthcare, and it’s a product or a technology or something new. But at the end of the day, we want to describe:
- What your business does, the nature of it?
- What differentiates your business?
- What markets your business serves?
- How will the products meet the needs of the community, the specific consumer organizations, or businesses?
- Your company will serve the Publics as I like to call them. Who are your publics?
- Explain the competitive advantage? (We always look at it from a marketing standpoint, but it's essential to cover a business startup standpoint)
- What is your competitive advantage? Clinical outcomes, location, price, or Is it the whole package?
- What are the pieces that help you stand out?
Section 3: Marketing Analysis
Next is market analysis. And this is where I find people need to spend more time on because this will help your patient marketing and overall strategic growth.
- What's the industry description and outlook?
- What's going on in the market. Do you know what's going on in healthcare?
- How is healthcare reform impacting your business?
- How does your product streamline and support the needs of the community?
- What's the outlook, the quality?
- What's your niche?
- What sets you apart in your market analysis?
- What's your target market's size?
- What's your pricing, gross margin, target, and competitive analysis?
- Who's playing in your swimming pool, and what did they do?
- What are your Strengths and weaknesses?
- How important is your target market to your competitors?
So I’ll give you an example right now, more and more people are struggling to get the care they need because the price of healthcare costs is so high.
Well, how is your product going to streamline and support the needs of the community? What’s the outlook, the quality, the fact that people aren’t getting care fast enough.
All of those pieces, the industry description of outlook, are such important information about your target market. What’s your niche, the swimming pool you’re swimming in? Show it, display it, paint that picture, and distinguishing characteristics.
What sets you apart again in your market analysis? Hey, ABC healthcare, does this Johnny do right, does this? This is where I come in. Know that piece, what’s your target market’s size. And this is important right now.
I’m working on a business plan for new technology in the healthcare space and a niche focus. I was meeting with some investors, and I have advisors too. And one of the things they said is what’s the size of the bucket. So when I broke down the size of the market, I realized it was small in the big scheme of things.
It allowed me to define a business model around this niche that helped me understand the market analysis. How I was going to market, going to scale, and how I would create buy-in to those around me with a small market share. Know that what’s your pricing, gross margin, target, and competitive analysis. Who’s playing in your swimming pool, and what did they do?
Your Strengths and weaknesses. Now we’ll talk a little bit more about identifying that, but that is something so important. I know where I’m strong, where I’m weak, and I’m learning every day to reassess that understanding of myself. As you go through, you may find that your strengths are higher than what you thought because you’re like, Oh, I knew that. Well, that’s part of learning is understanding how to identify your strengths and weaknesses.
How important is your target market to your competitors? If you’re picking a healthcare practice in the middle of Iowa, well, you probably don’t have competitors, just being honest. And you got to understand that what’s your window of opportunities? Is there a time to capitalize? Any market barriers? Regulatory restrictions? Do you know anything regarding home health licensure and audits? Any of those things should all come under this marketing analysis.
Section-4: Organization and Management
So a sample structure for your business plan next would be organization and management.
- Who's your team?
- What are the ownership details and percentages of ownership?
- What is their involvement, track record?
- What are the details of education, special skills, and unique experience?
- Who is the board of directors?
- What is their legal structure?
There are times where I only show myself on the organizational leadership side. And there are times when I bring in a powerful board of directors or team of managers because I need to diversify the skill sets that I’m showing to this business model in relation to scalability, growth, and the outlook.
And if I’m going for money or not, am I trying to pick up investors? Am I trying to pick up clients? They are some of the purposes of ways that I may use this business plan to benefit me.
Sample Org Board
- Who's in your organization?
- Who they report to what their role is?
- Who is the owner, who is the medical director? Who's under them?
- What are the products tied to a person?
- How to hold people accountable?
- How to streamline success?
This is a sample org board, and there are two trains of thoughts with org boards, but I bring it up because it’s business one on one. We want to identify who’s in your organization, who they report to what their role is. Now, something that I often build-out is I put in accountability measures on an organizing chart. So that I know, as you can see by this, and I had fun with this.
If you can guess the movie, email me, and I’ll send a special prize to you because I have built the names within this organization based around a film that I grew up with, which happens to be my kids’ favorite movie as well. So if you can guess that, email me, and I’ll send you a special treat from Brandon.
But the idea that I’m trying to show is how we structure an organization in different ways. Who’s the owner, who’s the medical director. Who’s under them. What are the products directly tied to each person so that I can hold everyone accountable? That’s the bottom line. Accountability is the secret to automation. How do I keep people accountable? How do I streamline success and create a buy-in based on understanding?
Type of Legal Business Structures
1. Sole Proprietorships
2. Cooperative
3. Partnerships
- General Partnership (GP)
- Limited Partnership (LP)
- Joint Venture(JV)
4. Corporations
- Non Profit Corporations
- C-Corporation
- S-Corporation
- Limited Liability Corporation
So I had mentioned it earlier. You got to know your legal business structure. There are so many different kinds, and I’m just naming a couple; you may be a sole proprietor, a cooperative, a partnership, or a corp. The majority of you are going to go under Corp, a professional corp. I happened to go under S corp. All of my companies are S corps. Some of you may go LLC. That’s what a CPA and lawyers are for, discussing goals and identifying the best structure both to protect you as well as for tax purposes.
So there are two reasons why we need to talk with a CPA and a lawyer. One is protection, and the other is, you know, tax filing and the best route based on finances and whatnot. I’ll give you some quick overhead on legal business structures.
Sole Proprietors
The simplest business form under which one can operate a business. It’s not a legal entity; it merely refers to a person who owns a business and is personally responsible for its debts. So you can be a sole proprietor; all the risk is on you, so know it.
Cooperative
A cooperative is a business or organization owned by an operative operated to benefit those using its services. So co-ops you see in food, you see all different aspects. So one of the most popular co-ops right now is organic vegetables, where a group of the co-op of farmers will come together, and people will be part of it, and they’ll purchase. It is set up as an infrastructure for supporting that group.
Partnerships
General Partnership, Limited Partnership, Joint Venture. You can go into this in more detail. In our industry, I rarely find this unless you’re at a point where you’re scaling to a certain level, but very seldom what you need to know this.
Corporations
This is the biggest area that I want you to understand, and the only thing I technically didn’t write was the professional Corp, which many you may go after. And again, talk with your CPA about it.
Non-profit Corp 501C3
You become a 501C3 because you want to be able to offer tax deductions for those who donate money, something you should understand. There’s a lot of red tape in that.
C-Corp
A C-Corp is a separate legal entity owned by shareholders. The corporate structure limits each owner’s personal liability. I find that it’s more expensive often. And unless you’re scaling to a certain point, my CPA personally told me unless I’m looking to sell, bringing outside investors to a certain extent, that it wasn’t appropriate.
S-Corp
S-corp is similar to C-Corp. it’s a standard Corp that has elected a special tax status with the IRS. The S Corp is where my CPA felt my business models for the best fit.
Limited Liability Corp (LLC)
Limited Liability Corp is viewed as a hybrid between a corporation and a partnership. An LLC is formed under state law and gives you personal liability protection tax-wise. An LLC is similar to an S-Corp with business income and expenses reported on your personal tax return. So a lot of people go to LLC. It tends to be cheaper than an S-corp.
Again, consult with your CPA, consult with your legal team, just to make sure you make a great decision. In many cases, you can change. So a lot of the time, you’ll start as an LLC and then switch up from there. It just depends.
Section 5: Service or Product Line
So the next part of our business plan for private practice is our service and product line. We are going to break this down into great detail.
- How will your service benefit the community?
- How will you differentiate from your competitors?
- Is there any "intellectual property" connected to the service or product that you are offering?
- Is there something you're doing that no one else is doing?
- What were your research and development activities?
- How did you get here?
- What did you do to understand your niche within the area related to your service or product line?
I’ve built a curriculum. You look at it like a Mathnasium. They had a finite intellectual property, which was their curriculum to rolling out their tutoring programs by people processing that. Every child was treated with this curriculum that was indeed their property. Do you have that, or is it just, you’re delivering a service?
Section 6: Marketing and Sales
Now you want a detail; you’re going to take your market analysis. But it’s essential for this part that you start to look at. What’s your market strategy. It should be an ongoing business evaluation process unique to your company.
I’m a big believer that strategic relationships are everything. I used to knock on 50 doctor doors a week to create my referral network, have lunch, build that relationship, and pick and choose the people aligned with my vision.
I’m a people person. And hopefully, you are too, because that’s been the greatest return on investment. The other thing is we’ve got digital marketing, which is transforming how we reach people today. There are so many solutions out there, and I will bring more ideas to you along this journey. So you need to know the following:
- Market Penetration Strategy
- Your Growth Strategy
- Channels of Distribution Strategy
- Communication Strategy
- Sales Strategies and Activities
How are you distributing it? So I work with many different strategic partners where they’ll distribute some of my teachings and training and workshops. I’ll write content for them, et cetera.
What are your channels of delivery, sales strategies, and activities? How are you going about it? How are you creating buy-in? How are you empowering the referral process? Pretty simple, right? It’s fun. You’ll enjoy it. Today, you’re going to learn a lot of ways to attack this part of your business.
Section 7: Financial Projections
So the next piece is usually the piece where you feel the most afraid. Compliance and financial projections are the two where I start to see you roll your eyes.
Oh my gosh, what am I going to do?
I want you to listen to me now when I tell you, you got this at your fingertips, I never met a private practice owner that couldn’t do this, and there’s support out there for you. So you’re not alone. But the idea is that you confronted that you address and understand that this is part of crafting your optimal business plan and optimal business foundation. Something that you should not overlook. So you want to develop your financial projections, look at your:
- Financial Trend Analysis
- Financial Projections
- Historical Financial Data
- Projected Cash Flow Analysis
Now we’re going to talk more about metrics, but just so you guys get an idea of like, where’s the market share, how many clients are you planning to target in the first month, I’m going to see a hundred clients in my first month.
- How are we going to get there?
- What's the revenue look like?
- What's your gross revenue?
- What's your cashflow meaning?
- Is it going to take time?
Insurance, as we talk about Payer Sources later, insurance is a slower payer source. So you’re not going to get it often. There are times where you won’t get paid in 30 days from insurance.
So those are all the things that you should start to attribute:
- What are the contracts and payer sources?
- What is their cash flow?
- How fast are you getting paid?
And then run a profitability study. Getting back to something that I had said initially, understanding your people’s productivity, how you’re compensating, the margins, and the reimbursement tied to it is important. And that all comes into your financial projections.
Determine your Scalability: Understanding how to prepare for the future
So one of the last things I’m going to cover is scalability. Everyone says to me, and they’re like:
- What is scalability?
- What's your out plan?
- Where are you going?
- How to prepare for the future?
Scalability is growth, and when I launch a company, I usually launch a company with an understanding of where I’m going to start and where it’s going to go. Now, often it doesn’t take all those courses because we pivot in business. That’s what we do.
But right now, as I said, I’m working on new software. In that software, I’ve already decided it’s getting bought out. And I even know who’s going to buy it out. So I’ve determined the scalability of that business model that I can work towards that goal. And people say, well, why do you do that?
Because I want to know what I need to prepare to get there, people say, well, why would you like to determine already that you’re going to sell it? Well, I know what I’m creating will eventually have the best scalability under a giant enterprise than what I currently offer.
So if I get it to a point where it’s ready for scalability, the right partner will come in and take it to that next level global on a whole different level. Some of you might want smaller scalability, and some of you might have the green light go light of let’s make this thing an empire. And that’s something you should start to name as you look through this process.
Resources for Creating an Effective Business Plan
- SCORE Business Plan Template
- Sample Business Plan Template
- U.S. Small Business Administration
Here are some resources for creating your business plan, click on them, look at them, and go to it. SBA is alone. If you haven’t heard of small business administration, they’ve got loans. Web PT had a perfect one on PT. I have some other business plans, and if you need more reach out, I’m here for you. I got your back.
Get your plan started. Let’s make it happen. Let’s create the practice you want it to be. Let’s do it now, and let’s do it together.
Don’t forget to sign up for a free 30-minute video consult. We will make it happen. We will push you to the finish line. We can thrive, not just survive.
