Producing
An Effective Business Plan
By Pattie
Stechschulte
Do you like working for somebody else and having that nice, dependable paycheck? Or, do you dream about being out on your own with the freedom to run a practice the way you have always wanted to?
All chiropractors contemplate starting their own practice or buying a practice at some point in their career. In a practice management survey published in Today’s Chiropractic in November/December 1999, approximately 78 percent of respondents were solo practitioners, while only 12 percent were partners and 4 percent were associates.
The biggest obstacle standing in your way is securing a small business loan. To get that loan, you have to convince the lender that you are a good financial risk, explain how a chiropractic practice works and that it is a good investment.
Organize and Research
There are a few things you must do before you actually sit down to write out your business plan.
First, you need to organize your thoughts to envision every detail of your dream practice. Figure out where you would like an office, the equipment and décor you want in the office and estimate the costs. By working backwards, you will be able to break things down into more attainable or workable parts.
The second thing you have to do is gather copies of all your important documents including your credit report, letters of reference from former employers and/or business associates, diplomas, etc.
The third step is to conduct some research on the demographics of the area where you want to open your practice. What is the population, income levels, the number of competitive chiropractors, what types of industries/large companies are in the area? Also, contact the national and state chiropractic associations to obtain the average income levels for chiropractors and average expenses.
The fourth step is figure out what your operating costs of running an office will be and how much you will need to charge to make a profit. It might be a good idea to hire a Certified Public Accountant to help you with this. Since they have a better understanding of what the lenders are looking for, their advice can save you time and aggravation.
Outlining the Plan
Once you have gathered all of your necessary background information, then you need to dedicate some time to write out your business plan. Each of the following sections should be included in your final business plan because they are designed to help you plot out your objectives and to help your potential lender understand your intentions.
1. Introduction: A one to two page summary that describes your business and provides highlights of your business plan.
2. Personal Information: A few paragraphs that serve as a biography of your professional life including any accomplishments.
3. Projected Living Expenses: Summarize how much money you will need to survive on and outline your personal monthly expenditures. Also, include any additional income you may be receiving, especially a working spouse.
4. Demographic and Professional Data: Analysis the current population to determine your potential patient base and emphasize the need for a chiropractor to serve the area.
5. Business History: If you are purchasing an existing practice, you need to obtain the financial records from the current owner dating back several years.
6. Legal Documents: Include copies of any documents or agreements for your property or equipment that you will need to sign or have already signed.
7. Cost Projections: Using the demographic information you gathered, you need to chart out what your actual operating costs on a day-to-day basis.
8. Projections: Here is where you will have to forecast your bottom line, basically how much money will be coming in against your cost of doing business.
9. Marketing Plan: Propose how you plan on publicizing your practice to the public, including advertisements, mailings, etc., and the costs involved.
10. Finances Needed: Simply listing the amount of money you are requesting to borrow and propose a realistic timeframe of paying it back.
It will take a lot of time and effort to produce a well, thought-out business plan, but you will stand a better chance of getting the loan with it attached to your loan packet than without one.
About the author: Pattie Stechschulte, an award-winning writer, is the freelance associate editor of Today's Chiropractic magazine and has been responsible for TC Online since its inception in November 1999. Inquiries should be addressed to her at 3803 Brads Court, Marietta, GA 30066; or E-mail pattiest@todayschiropractic.com.