Starting a non medical home care business can be very profitable. With proper planning, execution and hard work, you can enjoy great success. Below you will learn the keys to launching a successful non medical home care business.
Importantly, a critical step in starting a non medical home care business is to complete your business plan. To help you out, you should download Growthink’s Ultimate Business Plan Template here.
14 Steps To Start a Non Medical Home Care Business:
- Choose the Name for Your Non Medical Home Care Business
- Develop Your Non Medical Home Care Business Plan
- Choose the Legal Structure for Your Non Medical Home Care Business
- Secure Startup Funding for Your Non Medical Home Care Business (If Needed)
- Secure a Location for Your Business
- Register Your Non Medical Home Care Business with the IRS
- Open a Business Bank Account
- Get a Business Credit Card
- Get the Required Business Licenses and Permits
- Get Business Insurance for Your Non Medical Home Care Business
- Buy or Lease the Right Non Medical Home Care Business Equipment
- Develop Your Non Medical Home Care Business Marketing Materials
- Purchase and Setup the Software Needed to Run Your Non Medical Home Care Business
- Open for Business
1. Choose the Name for Your Non Medical Home Care Business
The first step to starting a non medical home care business is to choose your business’ name.
This is a very important choice since your company name is your brand and will last for the lifetime of your business. Ideally you choose a name that is meaningful and memorable. Here are some tips for choosing a name for your non medical home care business:
- Make sure the name is available. Check your desired name against trademark databases and your state’s list of registered business names to see if it’s available. Also check to see if a suitable domain name is available.
- Keep it simple. The best names are usually ones that are easy to remember, pronounce and spell.
- Think about marketing. Come up with a name that reflects the desired brand and/or focus of your non medical home care business.
2. Develop Your Non Medical Home Care Business Plan
One of the most important steps in starting a non medical home care business is to develop your business plan. The process of creating your plan ensures that you fully understand your market and your business model. The plan also provides you with a roadmap to follow and if needed, to present to funding sources to raise capital for your business.
Your business plan should include the following sections:
- Executive Summary – this section should summarize your entire business plan so readers can quickly understand the key details of your non medical home care business.
- Company Overview – this section tells the reader about the history of your non medical home care business and what type of private home care business you operate. For example, are you a home health agency, in-home care service, home nursing service, personal home care service, or a respite care business?
- Industry Analysis – here you will document key information about the home care services industry. Conduct market research and document how big the industry is and what trends are affecting it.
- Customer Analysis – in this section, you will document who your ideal or target customers are and their demographics. For example, how old are they? Where do they live? What do they find important when purchasing services like the ones you will offer?
- Competitive Analysis – here you will document the key direct and indirect competitors you will face and how you will build competitive advantage.
- Marketing Plan – your marketing plan should address the 4Ps: Product, Price, Promotions and Place.
- Product: Determine and document what products/services you will offer
- Prices: Document the prices of your products/services
- Place: Where will your business be located and how will that location help you increase sales?
- Promotions: What promotional methods will you use to attract customers to your non medical home care business? For example, you might decide to use pay-per-click advertising, public relations, search engine optimization and/or social media marketing.
- Operations Plan – here you will determine the key processes you will need to run your day-to-day operations. You will also determine your staffing needs. Finally, in this section of your plan, you will create a projected growth timeline showing the milestones you hope to achieve in the coming years.
- Management Team – this section details the background of your company’s management team.
- Financial Plan – finally, the financial plan answers questions including the following:
- What startup costs will you incur?
- How will your non medical home care business make money?
- What are your projected sales and expenses for the next five years?
- Do you need to raise funding to launch your business?
3. Choose the Legal Structure for Your Non Medical Home Care Business
Next you need to choose a legal business structure for your non medical home care business and register it and your business name with the Secretary of State in each state where you operate your business.
Below are the five most common legal structures:
1) Sole proprietorship
A sole proprietorship is a business entity in which the owner of the non medical home care business and the business are the same legal person. The owner of a sole proprietorship is responsible for all debts and obligations of the business. There are no formalities required to establish a sole proprietorship, and it is easy to set up and operate. The main advantage of a sole proprietorship is that it is simple and inexpensive to establish. The main disadvantage is that the owner is liable for all debts and obligations of the business.
A partnership is a legal structure that is popular among small businesses. It is an agreement between two or more people who want to start a non medical home care business together. The partners share in the profits and losses of the business.
The advantages of a partnership are that it is easy to set up, and the partners share in the profits and losses of the business. The disadvantages of a partnership are that the partners are jointly liable for the debts of the business, and disagreements between partners can be difficult to resolve.
3) Limited Liability Company (LLC)
A limited liability company, or LLC, is a type of business entity that provides limited liability to its owners. This means that the owners of an LLC are not personally responsible for the debts and liabilities of the business. The advantages of an LLC for a non medical home care business include flexibility in management, pass-through taxation (avoids double taxation as explained below), and limited personal liability. The disadvantages of an LLC include lack of availability in some states and self-employment taxes.
4) C Corporation
A C Corporation is a business entity that is separate from its owners. It has its own tax ID and can have shareholders. The main advantage of a C Corporation for a non medical home care business is that it offers limited liability to its owners. This means that the owners are not personally responsible for the debts and liabilities of the business. The disadvantage is that C Corporations are subject to double taxation. This means that the corporation pays taxes on its profits, and the shareholders also pay taxes on their dividends.
5) S Corporation
An S Corporation is a type of corporation that provides its owners with limited liability protection and allows them to pass their business income through to their personal income tax returns, thus avoiding double taxation. There are several limitations on S Corporations including the number of shareholders they can have among others.
Once you register your non medical home care business, your state will send you your official “Articles of Incorporation.” You will need this among other documentation when establishing your banking account (see below). We recommend that you consult an attorney in determining which legal structure is best suited for your company.
4. Secure Startup Funding for Your Non Medical Home Care Business (If Needed)
In developing your own home care business plan, you might have determined that you need to raise funding to launch your business.
If so, the main sources of funding for a non medical home care business to consider are personal savings, family and friends, credit card financing, bank loans, crowdfunding and angel investors. Angel investors are individuals who provide capital to early-stage businesses. Angel investors typically will invest in a non medical home care business that they believe has high potential for growth.
5. Secure a Location for Your Business
There are a few key factors to consider when choosing a location for your non medical home care business. First, you’ll want to think about the needs of your target market. For example, if you’re targeting seniors, you may want to choose a location close to retirement communities or hospitals. If you’re targeting families with young children, you’ll want to be close to schools and parks.
Next, think about accessibility. If you’re planning on offering transportation services, you’ll need to operate in a location that is accessible by public transportation.
Finally, consider your budget and what will be the most cost-effective for your business. You’ll also want to think about the setting you want for your business. Do you want to operate out of your home, or do you want to lease office space?
6. Register Your Non Medical Home Care Business with the IRS
Next, you need to register your business with the Internal Revenue Service (IRS) which will result in the IRS issuing you an Employer Identification Number (EIN).
Most banks will require you to have an EIN in order to open up an account. In addition, in order to hire employees, you will need an EIN since that is how the IRS tracks your payroll tax payments.
Note that if you are a sole proprietor without employees, you generally do not need to get an EIN. Rather, you would use your social security number (instead of your EIN) as your taxpayer identification number.
7. Open a Business Bank Account
It is important to establish a bank account or business checking account in your non medical home care business’ name. This process is fairly simple and involves the following steps:
- Identify and contact the bank you want to use
- Gather and present the required documents (generally include your company’s Articles of Incorporation, driver’s license or passport, and proof of address)
- Complete the bank’s application form and provide all relevant information
- Meet with a banker to discuss your business needs and establish a relationship with them
8. Get a Business Credit Card
You should get a business credit card for your non medical home care business to help you separate personal and business expenses.
You can either apply for a business credit card through your bank or apply for one through a credit card company.
When you’re applying for a business credit card, you’ll need to provide some information about your business. This includes the name of your business, the address of your business, and the type of business you’re running. You’ll also need to provide some information about yourself, including your name, Social Security number, and date of birth.
Once you’ve been approved for a business credit card, you’ll be able to use it to make purchases for your business. You can also use it to build your credit history which could be very important in securing loans and getting credit lines for your business in the future.
9. Get the Required Business Licenses and Permits
The licenses and permits you need to start a non medical home care business will vary depending on your location. However, generally you will need a business license, a state license, and insurance. You may also need a permit to operate as a home care agency. To find out what licenses and permits you need in your area, contact your local government or business licensing agency.
10. Get Business Insurance for Your Non Medical Home Care Business
The type of insurance you need to operate a non medical home care business will depend on the scope of the operation.
Some business insurance policies you should consider for your non medical home care business include:
- General liability insurance: This covers accidents and injuries that occur on your property. It also covers damages caused by your employees or products.
- Auto insurance: If a vehicle is used in your business, this type of insurance will cover if a vehicle is damaged or stolen.
- Workers’ compensation insurance: If you have employees, this type of policy works with your general liability policy to protect against workplace injuries and accidents. It also covers medical expenses and lost wages.
- Commercial property insurance: This covers damage to your property caused by fire, theft, or vandalism.
- Business interruption insurance: This covers lost income and expenses if your business is forced to close due to a covered event.
- Professional liability insurance: This protects your business against claims of professional negligence.
Find an insurance agent, tell them about your business and its needs, and they will recommend policies that fit those needs.
11. Buy or Lease the Right Non Medical Home Care Business Equipment
To start a non medical home care business, you will need some basic equipment. This may include a computer with internet access, a printer, a phone, and a fax machine. You may also want to invest in a copy machine and scanner. You may also need a vehicle to transport your clients.
12. Develop Your Non Medical Home Care Business Marketing Materials
Marketing materials will be required to attract and retain customers to your non medical home care business.
The key marketing materials you will need are as follows:
- Logo: Spend some time developing a good logo for your non medical home care business. Your logo will be printed on company stationery, business cards, marketing materials and so forth. The right logo can increase customer trust and awareness of your brand.
- Website: Likewise, a professional website provides potential customers with information about the services you offer, your company’s history, and contact information. Importantly, remember that the look and feel of your website will affect how customers perceive you.
- Social Media Accounts: establish social media accounts in your company’s name. Accounts on Facebook, Twitter, LinkedIn and/or other social media networks will help customers and others find and interact with your non medical home care business.
13. Purchase and Setup the Software Needed to Run Your Non Medical Home Care Business
The software you need to run a non medical home care business is a customer relationship management (CRM) system to manage your customers and appointments, and a billing system to track your invoices and payments. You may also want to consider an online booking system to make it easy for your customers to book appointments.
14. Open for Business
You are now ready to open your non medical home care business. If you followed the steps above, you should be in a great position to build a successful business. Below are answers to frequently asked questions that might further help you.
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How to Start a Non Medical Home Care Business FAQs
There is no one-size-fits-all answer to this question, as the difficulty of starting a non medical home health care business will vary depending on the specific market and location. However, some key factors to keep in mind include the availability of qualified employees, stringent regulations governing the industry, and competition from larger businesses.
One of the best ways to start a home healthcare business with no experience is to research the industry and find a mentor. You can also look for online courses or webinars that can teach you the basics of starting and running a home care business. Additionally, you can join industry associations and networking groups to learn from other experienced medical professionals in the field.
Finally, create a business plan and track your progress. There are many helpful resources online, including the U.S. Small Business Administration (SBA). The SBA offers free counseling and workshops for small businesses and online resources like templates and calculators.
Businesses that provide home care services to seniors and disabled individuals are the most profitable. There is a high demand for these services, and the market is growing as the population ages. Home health care agencies that offer nursing and other medical services are also in high demand. However, the profitability of a home care business can vary depending on the location and the services offered. So, it is essential to do some research before starting any home care business.
Other profitable home care businesses are personal care, companion care, and homemaker services, which include tasks such as cooking, cleaning, and running errands.
The cost of starting a non medical home care business can range from a few thousand dollars to over $50,000. The most important factor is the size and scope of the business. The startup costs include licensing and insurance fees, equipment, marketing materials, and staff training.
One of the most significant ongoing expenses for a home care business is hiring qualified caregivers. Other ordinary expenses include advertising and marketing, office supplies, and liability insurance. It's important to calculate these costs and factor them into your overall plan to ensure your business is profitable and sustainable in the long term.
Non medical home care businesses make money by charging a fee for their services. This fee can be either a flat rate or based on time. Additionally, some non medical home care businesses receive payments from health insurance providers or government programs. Finally, non medical home care businesses can also earn money by recruiting new clients.
There are many reasons owning a non-medical home care business can be profitable. First, the number of people over the age of 65 is growing rapidly. As more people reach retirement age, there will be an increasing demand for home care services. Additionally, the Baby Boomer generation is increasingly interested in staying in their homes as they age, rather than moving to a retirement community. This trend indicates increased demand for home care services.
Non medical home care businesses fail for various reasons, including a lack of industry knowledge, inadequate planning, and insufficient capitalization. Other reasons include failure to properly screen and train employees, marketing mistakes, and not pricing services correctly.