home health business plan template

How To Write a Winning Home Health Care Agency Business Plan + Template

Creating a business plan is essential for any business, but it can be especially helpful for home health care agency businesses who want to improve their strategy and/or raise funding.

A well-crafted business plan not only outlines the vision for your company, but also documents a step-by-step roadmap of how you are going to accomplish it. In order to create an effective business plan, you must first understand the components that are essential to its success.

This article provides an overview of the key elements that every home health care agency business owner should include in their business plan.

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What is a Home Health Care Agency Business Plan?

A home health care agency business plan is a formal written document that describes your company’s business strategy and its feasibility. It documents the reasons you will be successful, your areas of competitive advantage, and it includes information about your team members. Your business plan is a key document that will convince investors and lenders (if needed) that you are positioned to become a successful venture.

Why Write a Home Health Care Agency Business Plan?

A home health care agency business plan is required for banks and investors. The document is a clear and concise guide of your business idea and the steps you will take to make it profitable.

Entrepreneurs can also use this as a roadmap when starting their new company or venture, especially if they are inexperienced in starting a business.

Writing an Effective Home Health Care Agency Business Plan

The following are the key components of a successful home health care agency business plan:

Executive Summary

The executive summary of a home health care agency business plan is a one to two page overview of your entire business plan. It should summarize the main points, which will be presented in full in the rest of your business plan.

• Start with a one-line description of your home health care agency  
• Provide a short summary of the key points in each section of your business plan, which includes information about your company’s management team, industry analysis, competitive analysis, and financial forecast among others.

Company Description

This section should include a brief history of your company. Include a short description of how your company started, and provide a timeline of milestones your company has achieved.

If you are just starting your home health care agency business, you may not have a long company history. Instead, you can include information about your professional experience in this industry and how and why you conceived your new venture. If you have worked for a similar company before or have been involved in an entrepreneurial venture before starting your home health care agency firm, mention this.

You will also include information about your chosen home health care agency business model and how, if applicable, it is different from other companies in your industry.

Industry Analysis

The industry or market analysis is an important component of a home health care agency business plan. Conduct thorough market research to determine industry trends and document the size of your market. 

Questions to answer include:

• What part of the home health care agency industry are you targeting?
• How big is the market?
• What trends are happening in the industry right now (and if applicable, how do these trends support the success of your company)?

You should also include sources for the information you provide, such as published research reports and expert opinions.

Customer Analysis

This section should include a list of your target audience(s) with demographic and psychographic profiles (e.g., age, gender, income level, profession, job titles, interests). You will need to provide a profile of each customer segment separately, including their needs and wants.

For example, the customers of a home health care agency may include:

• The elderly
• People with disabilities
• New mothers
• Patients recovering from surgery or illness

Develop a strategy for targeting those customers who are most likely to buy from you, as well as those that might be influenced to buy your products or home health care agency services with the right marketing.

Competitive Analysis

The competitive analysis helps you determine how your product or service will be different from competitors, and what your unique selling proposition (USP) might be that will set you apart in this industry.

For each competitor, list their strengths and weaknesses. Next, determine your areas of competitive differentiation and/or advantage; that is, in what ways are you different from and ideally better than your competitors.

Marketing Plan

This part of the business plan is where you determine and document your marketing plan. . Your plan should be clearly laid out, including the following 4 Ps.

• Product/Service : Detail your product/service offerings here. Document their features and benefits.
• Price : Document your pricing strategy here. In addition to stating the prices for your products/services, mention how your pricing compares to your competition.
• Place : Where will your customers find you? What channels of distribution (e.g., partnerships) will you use to reach them if applicable?
• Promotion : How will you reach your target customers? For example, you may use social media, write blog posts, create an email marketing campaign, use pay-per-click advertising, launch a direct mail campaign. Or, you may promote your home health care agency business via public relations or partner with another organization to sponsor an event.  

Operations Plan

This part of your home health care agency business plan should include the following information:

• How will you deliver your service to customers? For example, will you do it in person or over the phone only?
• What infrastructure, equipment, and resources are needed to operate successfully? How can you meet those requirements within budget constraints?

The operations plan is where you also need to include your company’s business policies. You will want to establish policies related to everything from customer service to pricing, to the overall brand image you are trying to present.

Finally, and most importantly, in your Operations Plan, you will lay out the milestones your company hopes to achieve within the next five years. Create a chart that shows the key milestone(s) you hope to achieve each quarter for the next four quarters, and then each year for the following four years. Examples of milestones for a home health care agency business include reaching $X in sales. Other examples include hiring a certain number of employees, signing on a certain number of clients, and so on.

Management Team

List your team members here including their names and titles, as well as their expertise and experience relevant to your specific home health care agency industry. Include brief biography sketches for each team member.

Particularly, if you are seeking funding, the goal of this section is to convince investors and lenders that your team has the expertise and experience to execute on your plan. If you are missing key team members, document the roles and responsibilities you plan to hire for in the future.

Financial Plan

Here you will include a summary of your complete and detailed financial plan (your full financial projections go in the Appendix). 

This includes the following three financial statements:

Income Statement

Your income statement should include:

• Revenue : how much revenue you generate.
• Cost of Goods Sold : These are your direct costs associated with generating revenue. This includes labor costs, as well as the cost of any equipment and supplies used to deliver the product/service offering.
• Net Income (or loss) : Once expenses and revenue are totaled and deducted from each other, this is the net income or loss.

Sample Income Statement for a Startup Home Health Care Agency  

Balance sheet.

Include a balance sheet that shows your assets, liabilities, and equity. Your balance sheet should include:

• Assets : All of the things you own (including cash).
• Liabilities : This is what you owe against your company’s assets, such as accounts payable or loans.
• Equity : The worth of your business after all liabilities and assets are totaled and deducted from each other.

Sample Balance Sheet for a Startup Home Health Care Agency  

Cash flow statement.

Include a cash flow statement showing how much cash comes in, how much cash goes out and a net cash flow for each year. The cash flow statement should include:

• Cash Flow From Operations
• Cash Flow From Investments
• Cash Flow From Financing

Below is a sample of a projected cash flow statement for a startup home health care agency business.

Sample Cash Flow Statement for a Startup Home Health Care Agency  

You will also want to include an appendix section which will include:

• Your complete financial projections
• A complete list of your company’s business policies and procedures related to the rest of the business plan (marketing, operations, etc.)
• Any other documentation which supports what you included in the body of your business plan.

Writing a good business plan gives you the advantage of being fully prepared to launch and/or grow your home health care agency . It not only outlines your business vision but also provides a step-by-step process of how you are going to accomplish it.

A well-written business plan is an essential tool for any home health care agency. The tips we’ve provided in this article should help you write a winning business plan for your home health care agency.  

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Other Helpful Articles

How To Write a Winning Non-Medical Home Care Business Plan + Template

Home Health Care Business Plan Template [2024]

Home Health Care Business Plan Template

If you want to start a Home Health Care business or expand your current Home Health Care business, you need a business plan.

The following Home Health Care business plan template gives you the key elements to include in a winning Home Health Care Agency business plan.

Below is a sample home health care plan, outlining each of the key sections of a successful home care business plan. Once you create your plan, download it to PDF to show banks and investors.

I. Executive Summary

Business overview.

[Company Name] was founded by [Founder’s Name]. [Founder’s Name] is a nurse that has worked in local hospitals for over a decade. Her years of experience has taught her how to care for aging adults in a safe and supportive manner. [Founder’s Name] realizes the need for a quality and affordable home health care company as she has a difficult time placing her patients that are being discharged from the hospital with an agency that is reliable and within the patient’s budget. [Company Name] is a high-quality home health care agency that treats elderly patients with a wide array of illnesses and issues with a friendly and supportive staff that is also affordable and works within the patients budget.

Services Offered

[Company Name] will provide nursing, physical therapy, occupational therapy, home health aides, and social work services to its patient clients. In addition, their team of healthcare specialists will also be able to provide specialized services for Alzheimer’s, dementia, arthritis, and diabetic patients.

Customer Focus

[Company Name] will serve the aging community of [company location]. Many of the aging community has diabetes, arthritis, Alzheimer’s, dementia, etc. and would prefer to receive their care in the comfort of their own home rather than the hospital or assisted living facility. The demographics of the target customer profile is as follows:

• 106,727 residents
• Average income of $65,000
• 63.4% married
• 43.2% retired and/or over the age of 55
• Median age: 42 years

You can download our Business Plan Template (including a full, customizable financial model) to your computer here.

Management Team

[Company Name] is owned and operated by [Founder’s Name], a local nurse who has worked at local hospitals for over the past ten years. She has dealt with hundreds of elderly patients and their families finding adequate and affordable home health care upon being released from the hospital. [Founder’s Name] has realized there is a lack of quality and affordable home health care agencies in [company location]. She aims to provide the best in-home health care services while also being affordable for the patient and their families.

Aside from the nurses, therapists, aides, and social worker she will have on staff, [Founder’s Name] will also employ a receptionist and Office Manager to help with the administration and operation of the home health care agency.

Success Factors

[Company Name] has several advantages over its competition. Those advantages include:

• Compassionate Staff: Knowledgeable and friendly staff of nurses, therapists, aides, and social workers who are highly knowledgeable and experienced in their field.
• Location: [Company Name] will be able to service the entire metropolitan area of [company location] and its surrounding areas.
• Quality Care: [Company Name] will provide expert services so that the patients are at the highest comfort level.
• Pricing: [Company Name]’s pricing will be more affordable than its competition. They will also work on payment arrangements with the patient and their family so that the patient won’t have to sacrifice any type of care they might require because the cost is too high.

Financial Highlights

[Company Name] is seeking $150,000 in funding to launch its home health care business. The capital will be used for funding capital expenditures, staffing, marketing and advertising expenses, and working capital.

The breakout of the funding may be seen below:

• Capital expenditures (computers, equipment, etc.): $20,000
• Marketing and advertising: $10,000
• Staffing costs: $60,000
• Working capital: $10,000

II. Company Overview

Who is [company name].

[Company Name], is located at [insert location here] is a new home health care agency that provides skilled nursing services and occupational therapy to aging adults.

[Company Name] was founded by [Founder’s Name]. [Founder’s Name] is a nurse that has worked in the local hospital for over a decade. Her years of experience has taught her how to care for aging adults in a safe and supportive manner. [Founder’s Name] realizes the need for a quality and affordable home health care company as she has a difficult time placing her patients that are being discharged from the hospital with an agency that is reliable and within the patient’s budget. Many of her patients frequently use family members or friends that are inadequately trained or knowledgeable about what it takes to care for an elderly person. They have to rely on whomever is available because they can not afford a home health care agency. Most times, the caretaker’s schedule is inconsistent and the elderly person ends up back in the hospital because they are not receiving adequate nursing or therapy care.

A large segment of [Company Location]’s population is retired and/or elderly adults. There are not enough home health care agencies to support the aging population of this community.

[Company Name]’s History

[Founder’s Name] has been consulting with an attorney and CPA over the last few months to understand the business and financial obligations that go with owning their own business. Her lawyer has advised [Founder’s Name] that [Company Name] should be incorporated as an S-Corporation on [date of incorporation].

[Company Name] has identified the home health care office it will use as its headquarters. [Founder’s Name] has begun lease negotiations and began pricing out construction build-out for the facility.

Since incorporation, the company has achieved the following milestones:

• Found office location and signed Letter of Intent to lease it
• Decided on the company name, and developed the logo and website located at www…
• Finalized list of services the company will be able to provide
• Determined the office equipment and inventory requirements
• Began recruiting key employees for the home health care operation

[Company Name]’s Services

Below is [Company Name]’s list of services. All services will be provided by a trained and licensed staff.

• Skilled Nursing Services
• Therapy and Rehabilitation
• Alzheimer’s & Dementia Care
• Diabetes Care
• Arthritis Care
• Home Health Aide
• Medical Social Worker

[Company Name] will be able to provide daily services as well as accommodate on-call services and emergency response.

III. Industry Analysis

Strong and steady revenue growth is expected for the Home Care Providers industry over the five years to 2026 as a result of an aging population, increasing interest in home healthcare and expanded access to Medicare and Medicaid under the Patient Protection and Affordable Care Act (PPACA). The aging population will likely continue to foster revenue growth because this demographic not only requires more healthcare services compared with other age groups, but it also increasingly prefers home care. Payers will progressively shift to home care because it is more affordable than inpatient hospital and nursing home care.

Large companies will grow even larger through mergers and acquisitions. Moreover, home healthcare will evolve to include more chronic disease-management services, and consolidation will help the industry unite to influence policy change and benefit from larger-scale operations. Considering these projections, revenue is forecast to increase to $138 billion in the next five years.

IV. Customer Analysis

Demographic profile of target market.

[Company Name] will serve the community residents of [company location] and its surrounding areas.

The community of [company location] has thousands of retired, elderly adults who require a greater need of attention. Many of the aging community has diabetes, arthritis, Alzheimer’s, dementia, etc. and would prefer to receive their care in the comfort of their own home rather than the hospital or assisted living facility.

Below is a demographic breakdown of this area:

Customer Segmentation

We will primarily target the following four customer segments:

• Elderly patients who are being released from the hospital and their doctors highly recommended daily nursing services and/or therapy.
• Elderly patients who had a recent fall and require physical and/or occupational therapy to heal from their injury.
• Elderly patients who are suffering from Alzheimers or dementia and would prefer to remain in their home rather than an assisted living facility.
• Elderly patients who are diabetic and/or suffer from severe arthritis and need daily assistance with medication, etc.

V. Competitive Analysis

Direct & indirect competitors.

Comanche County Home Health Comanche County Memorial Hospital’s Home Health & Hospice has provided home health services for over a decade. Their staff is comprised of dedicated professionals who are committed to providing quality care in the comfort and convenience of the patients’ home. Their home health aides can assist the patient with grooming and light chores around their home. Home health care will verify if home health aide services are covered by their insurance policy. They accept Medicare, Insurance/HMO/PPO, Medicaid, Private Pay. The home health care team works closely with the physician to plan the care and monitor the patients’ progress. The nurse will contact the physician with any laboratory results, medication changes, or alterations in their health status.

Registered nurses, licensed practical nurses, nutritionists, speech therapists, physical therapists, occupational therapists, home health aides, and medical social workers all work with the patient and their family to develop an individual plan of treatment.

Elara Caring Elara Caring is one of the nation’s largest providers of home-based care, with a footprint in the Northeast, Midwest, and South. Elara Caring brings together three award-winning organizations – Great Lakes Caring, National Home Health Care, and Jordan Health Services, into one transformational company. They provide the highest-quality comprehensive care continuum of personal care, skilled home health, hospice care, and behavioral health. Their intimate understanding of the patients’ needs allows them to apply proprietary platforms to deliver proactive, customized care that improves quality of life and keeps patients in their homes.

Elara Caring leads patients through the post-acute care journey by providing the appropriate level of care, delivered wherever our patients call home. The company’s intimate understanding of its patients’ needs allows it to apply proprietary platforms to deliver proactive, customized care that improves quality of life and keeps patients in their homes.

Encompass Health Serving the Lawton, Oklahoma area, they are one of the nation’s leading providers of home health services and continually set the standard of homecare through their people, their approach and their outcomes. The patient experience is at the core of everything they do. That’s why they work collaboratively with the patient’s team of experts to craft a plan of care that meets their specific needs. Their skilled nurses, physical therapists, occupational therapists, speech language pathologists, medical social workers and home health aides use a coordinated, interprofessional approach to deliver compassionate, specialized care in the comfort of home.

Whether recovering from a surgery, recent hospital stay, or managing a disease or injury, Encompass Health’s services are designed to meet patient’s where they are. They offer cutting-edge specialty programs that focus on patient education, self-management and reducing hospital readmission, resulting in better care and better outcomes for their patients.

Competitive Advantage

• Compassionate Staff: Knowledgeable and friendly staff of nurses, therapists, aides, and social workers who are not only knowledgeable in their field, but place a special emphasis on compassion.
• Quality Care: [Company Name] will provide expert services and their patients will receive quality treatment and care so that the patient is as comfortable as they can be.

VI. Marketing Plan

The [company name] brand.

The [Company Name] brand will focus on the Company’s unique value proposition:

• Knowledgeable, friendly, expert staff of healthcare professionals.
• Quality level of service and care.
• Offering the best nursing, therapy, social worker, and aide services at competitive prices.

Promotions Strategy

[Company Name] will target all residents of [company location] within a 20-30 mile radius. The Company’s promotions strategy to reach the most clientele include:

Local Hospitals [Company Name] already has great relationships with the local hospitals. She will work to make sure the hospitals send referrals and highly recommend [company name] to its patients and their families upon releasing them from the hospital.

Nursing Homes and Assisted Living Facilities Oftentimes, an elderly patient will be placed in a nursing home or assisted living facility right away. Sometimes they are not happy and would rather go back home. [Company Name] will work with these facilities so that they recommend their agency for when a patient highly desires to receive the care in the comfort of their own home.

Website [Company Name] will have an informative and attractive website that will feature all of its services and referrals from other satisfied patients. The website will be highly informative and be designed in a way that is friendly and eye-catching.

SEO [Company Name] will invest in a high SEO presence so that the agency is listed at the top of the Google or Bing search engine when a family member is researching home health care agencies in [company location].

Billboard [Company Name] will have a billboard in an area of town at a busy intersection where thousands of cars and pedestrians pass daily. The location of the billboard will be in an area of town where there are a lot of doctors offices, rehab facilities, and a hospital nearby.

Advertising [Company Name] will invest in advertisements in featured local publications, such as community newspapers and newsletters that focus on the retired and aging population.

Pricing Strategy

[Company Name]’s pricing will be moderate so customers feel they receive great value when purchasing its services.

VII. Operations Plan

Functional roles.

[Company Name] will need to fulfill the following functional roles in order to execute their business plan and ensure the company’s success:

Administrative Functions

• General & administrative functions including legal, marketing, bookkeeping, tax, etc.
• Staff management and scheduling
• Hiring and training staff

Health Care Functions

• Physical Therapist
• Occupational Therapist
• Home Health Aides
• Social Worker

[Company Name] will achieve the following milestones in the following [] months:

• Secure 2,000 square foot office space
• Develop website, logo, and company website
• Secure small business loan bank financing
• Develop and finalize list of home health care services
• Hire and train staff
• Begin advertising campaign with hospitals, nursing homes, billboard, and print publications
• Grand Opening of [Company Name]

VIII. Management Team

Management team members.

[Company Name] is owned and operated by [Founder’s Name], a local nurse who has worked at local hospitals for over the past ten years. She has worked in the Occupational department where there are numerous elderly patients being treated daily. She has dealt with hundreds of elderly patients and their families finding adequate and affordable home health care upon being released from the hospital. [Founder’s Name] has realized there is a lack of quality and affordable home health care agencies in [company location]. She aims to provide the best in-home health care services while also being affordable for the patient and their families.

[Founder’s Name] graduated from the University of ABC with a Bachelor’s Degree in Nursing.

Hiring Plan

[Founder’s Name] will serve as the agency Founder and Chief Executive Officer. She will hire the following personnel in order to maintain an effective and profitable home health care business:

• Office Manager will assist [Founder’s Name] run the administrative tasks to operate the agency. This person will handle bookkeeping, tax payments, payroll, and office inventory.
• Receptionist will handle all phone calls and web inquiries. This person will also manage the scheduling of the home health care staff.
• Nurses – 2-3 nurses will be on staff to provide the nursing services.
• Occupational Therapist – 1 OT will be on staff to provide occupational therapy services.
• Physical Therapist – 1 PT will be on staff to provide physical therapy services.
• Home Health Aides – 3-4 aides will be on staff to provide basic care to the patients.
• Social Worker – 1 social worker will be on staff to oversee the welfare and care of each patient.

IX. Financial Plan

Revenue and cost drivers.

The revenues for [Company Name] will come from the fees it will charge the patients and their insurance for the health care services it provides.

The cost drivers for the company will be the payroll of the staff, lease on the office building, office supplies and equipment, and marketing and advertising costs.

Capital Requirements and Use of Funds

Key assumptions.

  5 Year Annual Income Statement

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Business Plan Template for Home Health Care

• Great for beginners
• Ready-to-use, fully customizable Subcategory
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Starting and running a home health care business requires careful planning and a well-structured strategy. ClickUp's Business Plan Template for Home Health Care is the ultimate tool to help entrepreneurs in this industry outline their goals, strategies, and financial projections. Whether you're a seasoned entrepreneur or just starting out, this template will guide you through the process of creating a comprehensive business plan that covers every aspect of your home health care business. From defining your target market and outlining your services to projecting your financials, ClickUp's template has got you covered. Get started today and pave the way for a successful home health care business!

Business Plan Template for Home Health Care Benefits

When using the Business Plan Template for Home Health Care, entrepreneurs in the industry can experience a multitude of benefits, such as:

• Clearly defining business goals and objectives
• Outlining detailed strategies and tactics for success
• Identifying target market and competitive analysis
• Developing financial projections and budgeting plans
• Creating a roadmap for growth and expansion in the industry
• Presenting a professional and comprehensive plan to potential investors and lenders
• Ensuring compliance with industry regulations and standards
• Establishing a solid foundation for operational efficiency and profitability

Main Elements of Home Health Care Business Plan Template

When starting a home health care business, it's crucial to have a well-structured business plan in place. ClickUp's Business Plan Template for Home Health Care includes:

• Custom Statuses: Track progress with statuses like Complete, In Progress, Needs Revision, and To Do, ensuring that each section of your business plan is accounted for and easily manageable.
• Custom Fields: Utilize custom fields such as Reference, Approved, and Section to add specific details to your business plan, making it easy to reference, track approvals, and organize sections.
• Different Views: Access five different views, including Topics, Status, Timeline, Business Plan, and Getting Started Guide, to visualize different aspects of your business plan, from tracking progress and managing sections to creating a timeline and getting started with your plan.
• Collaboration: Collaborate with your team by assigning tasks, setting due dates, and using comments to discuss and make revisions to your business plan in real-time.
• Integrations: Seamlessly integrate with other tools, such as financial software or project management tools, to enhance the functionality and accuracy of your business plan.

How To Use Business Plan Template for Home Health Care

Creating a business plan for a home health care company can be a daunting task, but with the help of ClickUp's Business Plan Template and the following steps, you'll be well on your way to success:

1. Define your business

Start by clearly defining your home health care business. Outline your mission, vision, and values, and identify your target market and the specific services you plan to offer. This step will help you establish a strong foundation for your business.

Use the Docs feature in ClickUp to create a comprehensive overview of your business, including your mission statement, target market analysis, and service offerings.

2. Conduct market research

To ensure the success of your home health care business, it's crucial to conduct thorough market research. Identify your competitors, analyze their strengths and weaknesses, and determine the demand for home health care services in your area. This information will help you develop a competitive advantage and identify potential growth opportunities.

Utilize the Table view in ClickUp to organize and analyze your market research data, including competitor analysis, market trends, and target market demographics.

3. Develop a marketing strategy

A solid marketing strategy is essential for attracting clients and growing your home health care business. Identify the most effective channels to reach your target audience, such as online advertising, social media, and local partnerships. Determine your unique selling points and craft compelling messaging that showcases the benefits of choosing your services.

Create tasks in ClickUp to outline your marketing plan, including specific actions and timelines for each marketing initiative. Use the Calendar view to visualize your marketing schedule and ensure timely execution.

4. Plan your financials

The financial aspect of your business plan is crucial for securing funding and ensuring the long-term sustainability of your home health care company. Estimate your startup costs, including licensing, equipment, staffing, and marketing expenses. Project your revenue and expenses for the first few years, and develop a realistic pricing strategy.

Use custom fields in ClickUp to track your financial projections and key performance indicators, such as revenue, expenses, and profit margins. The Dashboards feature in ClickUp can help you visualize your financial data and monitor your business's financial health.

By following these steps and utilizing ClickUp's Business Plan Template, you'll be well-prepared to launch and grow your home health care business. Remember to regularly review and update your business plan as your business evolves and new opportunities arise.

Get Started with ClickUp’s Business Plan Template for Home Health Care

Entrepreneurs in the home health care industry can use the ClickUp Business Plan Template to create a comprehensive plan for starting and operating a successful home health care business.

First, hit “Add Template” to sign up for ClickUp and add the template to your Workspace. Make sure you designate which Space or location in your Workspace you’d like this template applied.

Next, invite relevant members or guests to your Workspace to start collaborating.

Now you can take advantage of the full potential of this template to create a solid business plan:

• Use the Topics View to organize your business plan into different sections, such as Executive Summary, Market Analysis, Financial Projections, etc.
• The Status View will help you track the progress of each section, whether it's complete, in progress, needs revision, or still to do
• The Timeline View will give you a visual representation of your business plan's milestones and deadlines
• The Business Plan View will provide a comprehensive overview of your entire business plan, allowing you to easily navigate and review each section
• The Getting Started Guide View will offer step-by-step instructions and tips on how to use the template effectively
• Utilize the custom fields, such as Reference, Approved, and Section, to add additional information and track important details
• Update statuses and custom fields as you work on each section to keep track of progress and ensure everything is on track.
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How to Start a Home Health Care Business

13 Steps For Starting a Home Health Care Agency

Tips for a running a successful home health agency, how big is the home care provider industry, what are the key segments of the home care provider industry, what external factors affect the home care industry, who are the key competitors in the home care industry, what are the key customer segments in the home care market, what are the estimated start-up costs for a new home health care business, is a home health care business profitable, what are the keys to launching a new home care business, how to start a home health care business faqs, other helpful business plan articles & templates.

A home health care agency provides medical, nursing, and personal care to residents at their houses. For those who cannot afford to go to a nursing home, this is the next best option. But starting one takes more than having good intentions. It requires a lot of planning and patience.

However, before you begin your company, it is critical to conduct thorough market research to make certain that your company should indeed be in demand.

In this article, we share some tips on how to successfully start a home health care business.

Importantly, a critical step in starting a home care business is to complete your business plan. To help you out, you should download Growthink’s Ultimate Business Plan Template here .

Download our Ultimate Business Plan Template here

1. Determine Your Business Name

Choose the name of your home health care agency carefully. This may be among the most important decisions you have to make about your business. Make certain that any name you select is available in all 50 states so you can do business and register your company in each state if you choose so in the future.

Consider using a name that contains words like “home care” or “nursing.” This will help anyone searching online for those terms to find you quickly.

Also, choose a website domain name that is very relevant to the home health care services you provide. This way, people will be able to see your website’s URL quickly and easily.

2. Write a Home Care Business Plan

The next step in starting a home health care agency is to draft a business plan. Your business plan must be very detailed and contain all the information needed to successfully start and run your company.

Be certain to include details on how you will be able to deliver high-quality home health care for a reasonable cost, why consumers should choose your agency over others, and the benefits of going with a smaller company instead of a national or other local company.

3. Get Your Business License

File with the Secretary of State’s office for a license to function as a home health care provider in your state or city. If you are planning to start a home health care agency, find out about the rules and regulations in your area for home healthcare workers.

4. Obtain Any Other Necessary Certifications

Most states require that you have CPR, First Aid, and other types of training for your employees before they may work with clients. If you do not have these qualifications yourself, take them before beginning to recruit staff members so all home health care professionals will be adequately trained.

The Medicare and Medicaid certifications are also necessary if you want to accept payments from those government programs.

5. Register for a Tax ID

Register for a federal Employer Identification Number (EIN) or apply for an exemption from taxes if your business is considered a non-profit organization.

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6. open a business checking account.

Open up a business bank account so you can deposit money from home care services rendered and withdraw funds as necessary to pay for company expenses or taxes. All transactions related to your home healthcare agency should be done through this account, not your personal account.

7. Obtain Business Insurance

Obtain commercial liability insurance, workers’ compensation, and professional liability insurance.

8. Hire Nurses, Home Health Aides, and Other Medical Professionals

Interview and hire experienced nurses, professional caregivers, personal assistants, and other home care and medical professionals to work for your company. Ensure that they are adequately trained in their respective fields and have a clean background check.

9. Market Your Services

Advertise your services by placing ads in newspapers and posting flyers around the neighborhood where you will provide home health care services. Also, create a professional website with an online presence that will attract customers looking for home care services.

10. Train Your Employees

Train your employees on the proper techniques to safely and successfully provide services to elderly people in their homes. Schedule regular meetings with your employees to discuss any problems they are having providing services and ensure that each client’s needs and interests are being met.

11. Buy Home Health Care Supplies

The things you will need in order to conduct business are only limited by your imagination. Before starting any home health care services, make sure that you have what is necessary to run your business at any given time; this includes items like paper towels, sponges, rags, brooms, and dustpans, bleach products (such as disinfectants), hand soap for cleaning these areas after using the restroom or before preparing food or drinks for patients or guests, etc.

12. Outreach to the Local Community

Contact local nursing homes, retirement centers, and churches in your area that may have elderly people who need assistance with bathing or housekeeping chores. Schedule appointments with these potential clients so you can give them a home assessment of their needs.

13. Deliver Quality Care at Reasonable Rates

Home health care services are typically delivered on an agreed-upon basis for a fixed sum of money, which is less than conventional medical insurance rates in most cases. Check with your state’s Department of Health in order to find out how much you can charge for home care in your area without running into legal trouble. Remember that the goal is to deliver quality service while ensuring that you can charge customers what they are willing to pay while still making a profit.

Attend Continuing Education Classes

Attend seminars, workshops, conferences, and trade shows to learn about the latest trends and developments in home health care so you can incorporate them into your company as needed or desired.

Perform Regulatory Compliance Updates

Make sure you keep up with updates regarding regulatory compliance such as changes in privacy laws, medication administration rules/restrictions, home safety recommendations/measures, etc.

Document Everything

Keep good records for every patient seen by your agency including date of visit, problem treated, supplies used (even if it’s just gauze pads), medications given (including dosage and time administered; also include whether they were swallowed or injected if applicable) personal observations made about patient symptoms, symptoms exhibited, personal observations made about patient hygiene/personality/attitude, etc.

Build a Strong Team

A home care agency is only as good as its team of caregivers. When hiring caregivers, be sure to screen candidates thoroughly and look for people who are compassionate, patient, and reliable. Implement a clear and detailed hiring process that all employees must go through to ensure that the people you bring on board are qualified for the job.

Work in Close Collaboration with Patients and Their Families

Make sure that when working with patients, you keep everyone close by involved in making decisions about care. Keep them informed of any changes in their health status so they feel included in all aspects of treatment. Ensure they understand why specific things are done during treatment so there is no confusion or misconception regarding whether or not something was necessary or if it even happened at all.

Meet with family members to create a good rapport with them early on so they will be more likely to approve of your services if they believe you are competent enough to handle their loved one’s care needs. Additionally, this may help discourage family members from switching providers if they are dissatisfied with your services since there is already a good relationship between you.

Be Assertive but Not Aggressive About Office Finances

You should never be afraid to ask for payment from patients, but do not be too pushy about it either.

If someone is on a fixed income or has had an unexpected financial hardship, let them know that you are willing to work something out instead of demanding full payment or refusing service if they cannot afford to pay in full at that time. You can offer discounts or provide alternative arrangements such as allowing the patient to assist with office upkeep and cleaning in exchange for reduced fees.

Make sure to set firm boundaries ahead of time so your patients know what will and will not happen when they cannot pay their bills in full.

Train Your Employees Thoroughly

Create training manuals for each new hire so that they know exactly what procedures are to be followed when providing home care services to elderly patients. Take time every day to have employees practice what is taught in their training sessions so that it becomes second nature and they begin to feel comfortable providing home care services unsupervised. Also, use the manuals as a guide for regular meetings so that employees know what they should be covering and can refer back to them when needed.

Remember This Is People’s Lives You’re Handling

It may seem like just another day at work, but you are dealing with people’s lives here. Always ensure that you are treating patients with the utmost respect, showing empathy towards their situations, and being patient with them even during rough times. It is important to remember why you are doing this job in the first place — because you want to help others.

The home health care industry accounts for $109.6 billion in yearly revenue and is projected to grow to $134 billion in the next five years.

Home care currently employs over 1.9 million workers nationwide. The home care providers industry, according to the U.S. Bureau of Labor Statistics, is expected to grow by over 20 percent in the next ten years, adding about 300,000 new jobs.

The home care industry has 4 main sectors including:

• Home Support Services: These are non-medical support services that are provided in the homes of patients or clients rather than hospitals, nursing homes, or other medical facilities. Home support services include assistance with Activities for Daily Living (ADLs) such as eating, bathing, dressing, grooming, personal hygiene activities like toileting, positioning or transferring from bed to chair, etc., Instrumental Activities of Daily Living (IADLs) such as meal preparation, transportation, phone services, light housekeeping, etc.
• Home Nursing Services: Home nursing care is provided by registered nurses and certified nursing assistants who are licensed to provide all types of health care. Home health care companies are the ones that provide these services to patients upon referral from a doctor or medical professional. These services can be extended to include administering medications, supporting mobility issues, teaching families about the special needs of the patient and providing emotional support for family members. Home nursing services are typically more expensive than home support services because of the expertise involved with their provision. 
• Home Therapy Services: Home therapy is physical or occupational therapy conducted in a patient’s home instead of a clinical setting. Home therapy services are provided by home health care agencies that employ physical or occupational therapists for patients who would benefit from such therapy. 
• Home Relief Services: Home relief services is an umbrella term for home-based services including counseling, personal care, homemaking, and minor medical services as prescribed by a physician. Home relief services may be provided under this category not only to elderly people but also to those with disabilities, mental health or chronic conditions.

A home health care agency is an industry that is regulated by many different external factors. There are three external factors that affect the home care provider industry:

Increased regulations and certifications: The federal and state governments require that home care agencies comply with laws and regulations to ensure that both patients and employees receive quality services. Agencies must follow strict HIPAA (Health Insurance Portability and Accountability Act) guidelines for patient confidentiality protection, maintain detailed records of patient treatment plans, provide detailed training for employees such as initial and ongoing training on safety protocol, etc. These rules need to be followed whether the agency is a large one or a small one because it provides clarity about acceptable standards of inpatient care.

Economic slowdown: A global economic slowdown has an effect on healthcare service providers who rely on companies to reimburse their expenses for providing care to their employees. When companies are in financial trouble or revenues drop, home care providers could see a decrease in the number of services requested by these same companies because they do not want to pay for costly therapy services that are not required when layoffs occur.

Statutory changes: Since legislative rules can change with each election, home care agencies must be aware of possible statutory changes that affect how they conduct business. For example, if state laws require agencies to hire at least one nurse per five patient visits, but the law is reversed after an election and now states one nurse is required for every ten patient visits, this will affect all home care agencies who do not comply with this new requirement. Larger home care agencies may be able to absorb these types of changes but smaller providers may not be able to do so.

When starting a home care agency, it is important to know who the key competitors are in the industry. Some of the major competitors in the home care provider industry include:

Amedisys is a home health care company founded in 1995. Amedisys operates by providing comprehensive health care for patients for up to 90 days after they are discharged from the hospital. The Home Health Center is equipped with state-of-the-art technology and medical equipment, including oxygen concentrators, nebulizers, infusion pumps, suction machines, CPAP/BiPAP supplies, and Telemetry monitors.

Gentiva Health Services provides services at home that range from medication management to personal hygiene assistance. It also includes skilled nursing support if necessary. Their mission statement states that their goal is to provide quality care to those who need it most.  

Home Instead Senior Care franchise provides home health care services to senior citizens who want to maintain their independence while living at home. Home Instead offers non-medical in-home help with a variety of tasks including medication reminders, bathing assistance, meal preparation/feeding assistance, grocery shopping, and transportation.

Kindred Home is one of the largest home care companies in America, with nearly 100 locations. Their services include home health care, hospice care, and palliative care. They aim to provide medical care in a compassionate environment that promotes independence and wellness for clients. 

It is important to research these if these businesses are in your target area and understand their strategies in order to stay ahead of the competition.

Home care providers need to know who their customers are in order to serve their needs. Some of the key customer segments that home care agencies target include:

Aged/Elderly Population – Home health agencies typically provide patient services for this demographic because they are less mobile, have chronic illnesses, and sometimes need assistance with activities of daily living.

Children – Children may require home health care services due to conditions such as autism, cerebral palsy, spina bifida, muscular dystrophy, and cystic fibrosis. They often have extensive therapies that need to be performed in the home under the supervision of a qualified therapist.

Workers’ Compensation Patients – These are typically short-term patients who are injured/disabled due to an incident at work and are unable to perform their job duties for an extended period. If they are not allowed to return back to work after recovering from injuries or disabilities, they could potentially be eligible for permanent disability benefits through workers comp claims.

Patients with Disabilities – Those with disabilities may seek out home health care services if they cannot access transportation or cannot afford transportation, take advantage of community resources, or require help with activities of daily living.

Veterans – Military veterans may receive in-home care services if they are unable to perform their regular household duties due to mental/physical disabilities. They could also use this service if they do not have an in-home caregiver (partner, family member) available to provide them with aid in the home during recovery/treatment.

These are some key customer segments that home care agencies typically target in order to serve the needs in the market.

Some of the biggest startup expenses for home health care businesses include:

Office Furniture – If you decide that an office is necessary for your business (to act as a central location where all employees report to work), it may be necessary to rent/buy furniture such as desks, chairs, filing cabinets, etc. The cost of renting or buying office furniture will depend on what kind of furniture you require and the terms in your lease/purchase agreement.

Office Equipment – Office equipment may include PCs, laptops, printers, copiers, etc. The cost of purchasing these items will depend on what type of equipment is needed for your business and how much money you have to spend.

Medical Equipment – If you plan to service clients in their homes using medical equipment such as wheelchairs, walkers, etc., you will need to purchase this equipment upfront or finance it through a vendor (in which case there would be additional fees associated with the financing). It’s important to consider costs like insurance and costs related to shipping when evaluating financial options (if applicable).

Licenses/Permits – Home care businesses typically need to be licensed in the state where they operate. There may also be additional permits/certifications required by your city, county, etc., which will require a one-time fee paid to the appropriate agency.

Insurance – Depending on what kind of insurance coverage you decide to offer, there may be additional costs associated with buying the necessary general liability insurance policy(ies). One-time premiums may be paid by the homeowners directly to you, or paid to an insurance agency (in which case there may also be additional fees associated with the service).

Staff Training – Staff training doesn’t usually cost anything upfront, but it’s something that should be considered in terms of lost productivity if employees aren’t properly trained before starting to service clients. It may also be important to consider how long it takes for employees to complete training programs and what the total cost of this time is.

Networking/Commission Fees – Some home health care agencies choose to pay their employees a commission or bonus for contacting potential clients, which can help generate revenue faster. The cost of this type of compensation structure is typically included in the client’s fees (as opposed to an outwardly visible cost to customers).

Marketing – Marketing is often seen as one of the start-up costs because it requires money before you make any revenue for your business. Marketing costs can vary significantly depending on what type of marketing activities are done (online vs. print vs. radio).

Marketing materials – Marketing materials include brochures, business cards, etc., which you may utilize when marketing your services if they are not provided by third-party vendors. These items will require upfront costs that must be accounted for when looking at start-up costs.

For home health agencies, the profit margin is estimated to be between five and seven percent of total revenue. This number changes depending on how many patients you are able to serve per visit, as well as how much it costs you to provide each service. The best way for home health care professionals to increase their agency’s profitability is by building strong relationships with their clients and providing high-quality care in a cost-effective manner.

1. Continuing Education

Home health care nurses and therapists make a commitment to our patients’ well-being, but they also need to be committed to their own continuing education. New home care providers are encouraged to visit local continuing education workshops that are offered throughout the year.

2. Good Communication Skills

The demands of the job require that home care providers have good communication skills with patients and families or caregivers. Providers must be able to get on the same page quickly when it comes to establishing roles, routines, guidelines, and parameters for treatment.

3. Employee Training & Leadership

Home care business owners often start out as employees in their own businesses before they begin to grow beyond two or three people on staff. As a result, there is a need to develop strong leadership, delegation, and coaching skills along with understanding how to monitor progress while still allowing team members some level of autonomy.

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4. Strong Ethics & Values

Home care providers are responsible for providing appropriate, high-quality medical treatment. As a result, it’s important for business owners to have strong ethics and values so that their patients receive the best possible care.

5. Talent Acquisition

Good home health care nurses work well with others, but they often need to hire other people who can do the same thing in order to grow their businesses. Providers must be able to attract talent that reflects company culture, mission, vision, and brand standards – all of which play into talent acquisition strategies.

6. Business Acumen

Home care business owners need to have knowledge of how to manage administrative tasks, such as billing and financing, in addition to overseeing the business operations of the business. As a result, they need to develop broad business acumen, which can be accomplished by taking courses at local colleges or universities where continuing education opportunities are available.

7. Solid Marketing Plan

Successful home care business owners work with marketing experts to develop strategies that will help grow their businesses and increase awareness about the services they provide.

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What is a home health care business?

A home health business provides in-home medical care for patients who are unable to visit the hospital due to an illness or injury. These businesses typically specialize in certain areas such as nursing, physical therapy, occupational therapy, social work, etc., and offer services such as medication monitoring and support, treatments such as wound care and IVs, and life assistance such as mobility support.

The main goal of home health care is to provide short-term nursing care in order to help maintain independence within the patient's own home or community for as long as possible. They are generally not intended to cure illness but rather help improve a patient's quality of life and ability to function in a home environment.

What are the requirements to start a home care business?

The requirements to start a private home care business can vary depending on the state or country in which you reside. Typically, you will need to have a business license and insurance. You will also need to have a list of qualified caregivers who can provide home care services. You can learn more about the requirements in your area by visiting the website of the Department of Health and Human Services.

How do health care agencies get clients?

Home care agencies get clients by marketing their services. The best way for home health care professionals to get their agency's name out there is through networking with other business owners and attending events that are related to the industry. Other strategies include advertising through social media, online directories, in-home flyers, and direct mail campaigns.

What kind of training do I need when starting a home health care business?

When starting a home health care business, it's important to have strong leadership, delegation, and coaching skills along with understanding how to monitor patient progress while still allowing team members some level of autonomy. In addition to these things, home health care providers also need strong ethics and values so that patients can receive proper treatment. Lastly, talent acquisition is important, so it may be useful to have knowledge regarding how to properly train new hires.

Home health care professionals can gain the skills they need by taking courses at local colleges or universities where continuing education opportunities are available. It's also important for them to keep an open mind and take advantage of on-the-job training opportunities that allow them to develop their leadership, coaching, and monitoring abilities.

When starting a home health care business, it's important not only to learn about all of the necessary skills required but also how strategy fits into building a sustainable business model. There are many different aspects of running a company; however, developing marketing strategies will help increase awareness about the services you provide which can lead to more clients in the long term.

How to craft a successful home care business plan

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As a home care provider, you run your business with compassion and knowledge of the job and the local community you work with. After you’ve learned more about how to become a caregiver and how to start a home care business , you’re ready to formalize your ideas with a business plan.

How to create a home care business plan

Your business plan is an essential part of the portfolio you’ll present to banks, investors, and partners before launching your company. Every entrepreneur can benefit from a business plan that helps you turn your vision into action and strategize for success. For home care professionals, there are unique additions and considerations for your business plan. From determining your core local clients to developing the marketing plan to reach them, this guide will walk you through nine sections for your home care business plan.

1. The executive summary

The executive summary kicks off your business plan and hooks whoever’s reading it to learn more about your company and your proposal. Think of it a little like a sales pitch for your business and a preview of everything you lay out in your business plan.

A home care business summary should include:

• Your mission and the populations your business will serve 
• A list of your primary services 
• The demand for these services in your community
• What sets your home care business apart from competitors
• Your vision 
• A summary of funding needs

2. The company description

As a home care business working with clients in need, your professional background should be front and center. Your company description offers a snapshot of you and your business, and should include:

• The registered (or intended registered) name of your business
• The location of your company headquarters, and the neighborhoods, area, or city your business will reach
• Management, primary personnel, and their professional backgrounds
• Any licenses or certifications your staff has

Different types of home care services will need different certifications, like medical home care companies compared with senior transportation providers, for example. Make sure to research and include the requirements in your county, city, and state. 

If you’re in the preliminary stages of creating your home care business and haven’t secured the required licenses yet, mention any certifications you’re pursuing in this description.

3. Your business mission and goals

The mission and goals section of a business plan outlines the primary objectives of your company and how you plan to achieve them.

As more Americans advance into the senior age bracket, demand for credible home care businesses is rising. This need can help position your business for success and give you more opportunities to refine your mission and select specific populations to focus on. 

The need for home care help for senior relatives in particular has grown. As home care professional Christine Friedberg reflects, “I used to get on the phone and talk with clients about home care being an option for them or for their loved one, but it was like a new concept…For a long time, we were trying to educate the community about what home care was. Demand is greater than ever now.”

Medicare’s Triple Aim program may provide general inspiration for your own company goals. Their three pillars are :

• Centering and improving patients’ experience of care
• Improving health outcomes of patients served
• Mitigating the cost of care for individuals

From a business perspective, working with specific demographics may give you a leg up on funding. Based in Alexandria, VA, Griswold Home Care works with the area’s large population of aging veterans. To reach more of them, Griswold joined the cross-regional VA Community Care Network to provide in-home services to veterans needing extra support at home.

Not only was Griswold able to reach a specific community in need, but the program also helped this local home care business secure funding directly from the Department of Veterans Affairs . “We’ll see anywhere from 5 to 20 hours a week that the VA is covering, in terms of actually contracting with us directly. They pay us directly…so it’s very easy for the veteran to get in, take advantage of this program and take advantage of this care.”

In the home care industry, other demographics include:

• LGBTQ senior citizens
• People with Alzheimer’s
• People living with disabilities
• Non-seniors living with disabilities
• Adults whose first language isn’t English

Keep your demographic in mind as you refine your company’s identity and plan for growth. It will determine the steps you’ll take to fund your business and reach the neighbors who need you most.

4. Your services

The services section of your home care business plan sets the vision for what your business will specifically do. There are two main types of home care companies and services:

• Non-medical home care services – This type of home care business is not licensed to administer medical services or healthcare to its clients. Instead, they provide support, companionship, and home assistance. Services may include driving clients to doctor’s appointments, taking them to the park, or preparing meals.
• Medical home care services – Medical home care providers are staffed by nurses or other medical professionals licensed to administer medical care to their clients.

With the growing need for at-home healthcare businesses, some of the most common home care services include:

• Assistance with dressing, bathing, and using the toilet
• Companionship and diversion
• House cleaning and support with daily chores
• Transportation
• Hospice care
• Continued education for older adults
• Physical therapy and rehabilitation
• Prescription fulfillment services
• Administering medication
• Tracking vital physical or psychological health 
• Senior citizen relocation assistance
• Specialty nursing for a long-term illness or disability
• 24-hour emergency services

Get specific about what caregiver duties you’ll provide your clients, narrowing down your list with the most needed services in your local community. With 1 in 3 U.S. households on Nextdoor , you’ll be able to connect with neighbors, and your most important clients, with a free business page.

5. Your management structure

This section of your business plan establishes the legal status of your company, which affects other details, from the extent of your liability as the owner to how you’ll file taxes.

The most common business structures for home care providers are:

• Limited liability company (LLC)
• Sole proprietorship
• Partnership
• Corporation

To choose the right business structure for you, consider:

• Liability – Every business is financially and legally liable to compensate for injuries committed on their watch. Consult with an accountant to take stock of your personal assets to choose a framework that gives you adequate protection.
• Taxes – Your home healthcare business structure will determine how the profits you earn are taxed, whether through your business, on your individual tax returns, or a hybrid of both. As a general rule, the larger your company is, or the more shareholders it has, the more complex the tax process will be.
• Growth expectations – Whether your home care company will focus on your neighborhood or expand nationwide, your business structure should reflect your desired administrative capacity and set the stage for investors who want to scale alongside you. 

While S corporations and C corporations are often better suited for larger-scale companies, it’s possible to change the legal structure of your organization as it grows. Consider hiring experts, like a lawyer and an accountant, to help you with this stage of the process, especially if they have advised other local businesses in your area.

6. Your marketing plan

Show potential funding partners you know the modern home care market and set your local business up for success with marketing goals that cover the following bases:

• Digital marketing - In a job as intimate as home care, any new caregiver business begins on the local level. Sign up for a free business page with Nextdoor to instantly unlock a network of verified neighbors near you. Keep your business page updated with your story, photos, and contact information so local clients can find you and easily get in touch. Introduce yourself, share job listings, and keep neighbors updated on your business with free posts or hyperlocal advertising tools to reach more clients in specific ZIP codes you want to grow your business in.
• Partnerships – Qualified home care providers may be eligible to partner with care networks already plugged into local consumer demand. If properly licensed, apply to enroll as a Medicaid or Medicare partner. 
• Word-of-mouth marketing – Since home care professionals are a part of their clients’ and families’ lives, your local reputation will be important. Build trust in you and your services with testimonials on your website and recommendations on Nextdoor. 72% of neighbors there have been influenced by a business recommendation and 71% have shared one. Consider sharing your website and Nextdoor page with former clients to ask them for a recommendation.

Anything that makes your home care business unique, include in this section of your business plan. With a growing population of aging Americans, entrepreneurs are getting creative about the types of care they offer to suit different lifestyles.

Take Dr. Bill Thomas . He thought there should be a senior care option in place of the traditional nursing home so he created Minka, a company that builds small dwellings tailormade for seniors who want extra assistance, community, and autonomy in their advanced years. Says Thomas, “I think there will continue to be congregate housing, but the more choices people find in front of them, the more they’ll find something that suits them best.”

7. Your core financials

The next two sections cover your financial history with projections for your home care business’s future. This will be important for your business strategy, as well as for potential lenders, investors, or partners. 

The finance section of your home care business plan should include:

• Income statement
• Balance sheet
• Expected revenue
• A list of your assets and debts
• A summary of company expenses
• Desired loans

If you plan to enroll as a provider through a network like Medicare, mention in this section of your business plan.

8. Financial projections

This section of your home care business plan is important if you’re asking for an investment of any kind as it covers the funding you’re requesting, what you’ll use it for, and your plan to pay it back.

Financial projections should cover at least three years. Fortunately, the home care industry is slated for financial growth in the coming years. In the U.S. alone, the compound annual growth rate for home health care is projected to be 14.2% between 2021 and 2027.

However you plan to grow your company, speak with your local bank to discuss the full spectrum of financial options before finalizing your business plan. 

You can also connect with fellow home care professionals through Nextdoor for more information on the local home care industry in and around your neighborhood. This will help you get a realistic sense of your financial plan and the next few years operating your business.

9. Appendix

Your business plan’s appendix is where you’ll include any supporting or miscellaneous information for your business goals that didn’t have a place in the earlier sections.

Consider including:

• The resumes or educational and professional backgrounds of you, the owner, and your core staff
• Medical or non-medical licensing, or the licenses you plan to secure
• Any legal permits your business needs or the ones you plan to secure
• Bank statements, loans, and personal or professional credit history
• Real estate information about your business’ headquarters, if applicable

Make local connections through Nextdoor

As more Americans age, local caregivers are increasingly integral to the health of their communities. An effective home care business plan should tell this compelling narrative, sharing why there’s a need for your services and what you’ll do to fulfill them in your area. 

If you’re just building your local home care business, start close to home with a Nextdoor Business Page. Signing up is free, takes just a few minutes, and will help you spread the word, turning your neighbors into your first clients. 

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Home Health Care Business Plan Sample

Published Oct.12, 2016

Updated Apr.23, 2024

By: Jakub Babkins

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Table of Content

Home health care business plan for starting your own agency

Home healthcare is an $84 billion industry in the US alone and it is not going to slow down anytime soon. It covers both non-medical healthcare and skilled home health care, teams. Currently, the US has over 386,000 home health care businesses and employed more than 1.7 million people approx. But this home care agency business plan is not for everyone. It involves high stress and peer pressure in its environment.

If you have a strong desire and passion for helping others, this industry is very rewarding and you can earn a lot with compassion. If you are eager in starting a home health care business and you are raising funds, it is highly recommended to come up with a well-detailed home health care agency business plan .

Executive Summary

In this section, you need to explain all the basics of your homecare business model. Explain how much amount you want to raise for the growth of your home care agency business plan while presenting the expected operations and financials over the upcoming 3 years. For Example,

Wheatland Home Healthcare Agency (Your Company Name) is a Kansas-based home healthcare agency aimed to provide home health care agency business plan services to the targeted market.

The business

If you are wondering how to start a home care agency business plan , you first need to start with arranging for sophisticated medical equipment. Make a detailed list of all the business equipment you will have to arrange.

In addition, your company should also be licensed by your respective state and who will be your partners.

When making a homecare business model, you should also include who will be the owner and main operator of the home care agency business plan . For example, Wheatland Home Health Care Agency will be based in Wilson County (the area) and owned by its operators and investors. The office will be managed in a lavish office space in Kansas.

Your customers are basically the families and individuals looking for social services and/or home health care. If you are asking how to get clients for non-medical home care business, you can generally ask attorneys, physicians, healthcare facilities and insurance companies who can refer those patients to you.

Business Target

Consider this example when writing a business plan for home health care.

“The company is expecting a home care agency business plan loan for five years from its investors. Later on, we will manage the cash flow to finance the growth without requiring additional debt. We are planning to have full sales on credit. Hence, we need proper cash in hand in the beginning to avoid any problems related to the cash flow.“

Company Summary

When setting up a care company, you need to explain how you are going to make a presence in the market. For example, “Our agency will be based on a central location of Kansas and provide different services to clients and patients coming from Wilson, Neodesha, and Labette Counties, within the radius of 90 miles of our corporate offices.”

Here, you need to define your company and goals when you start a home health agency. You may want to promote and market your business and make an online presence by starting a website.

Company Owner

As a limited liability company, Wheatland Home Healthcare Agency is going to be operated and owned by Ethan J. Peter (name of company owner).

Along with years of experience in healthcare industry, explain the specialization and qualification of the owner.

Why the home health care business is being started?

When making a non-medical home care business plan, explain what the inspiration behind starting a home health care business is. Do you have a strong desire to help people in need which drives you to make it your profession? Do you have years of experience working with a healthcare organization and want to start your own home care agency business ?

How the home health care business will be started?

Since your company is being started, you will definitely need to address your funding matters and startup costs. In this sample business plan for home health care agency, we have listed the assets required for start-up, a breakdown of start-up expenses, total cash required, total funding, investment, capital, and other liabilities along with the startup cost diagram to illustrate the expected expenses, investment, assets, bank loans for the business plan , etc.

Services for Customers

The home health care agency’s business plan  should be aimed to help people with special needs as well as elderly in their daily activities and providing all the living help at the home. The company should also retain a skilled team of healthcare professionals, in case any specific treatment is required or in an emergency.

Along with at-home facilities, your company should also provide facilities to take them out if they are not able to drive their car. In this section of a home care business plan , you need to describe the services you have planned to offer.

As a home care agency business plan , you should ensure that all your clients/patients have been treated well. The following services should be provided by specialized health care nurses, physicians, mental health counselors, physical therapists, chiropractors, rehab counselors, and other professionals who are well versed in providing valuable services. Your non-medical home care agency business plan should include the following services –

• Nursing Aide
• Skilled Nursing
• Social Work
• Personal Injury Case Management
• Physical, Occupational, and Speech Therapy
• Personal Assistance Services
• Home Medication Management

When creating a business plan for home health care agency, you may also want to provide resource linkage, assessment, planning, and reporting services for injury case management.

Marketing Analysis of Home Health Care Business

When raising funds, the best thing you can have is a foolproof business plan for home care agency to stand out in the competition and market your home care agency business . It goes without saying that home health care is a growing industry on both the national and international levels. If your community has become an over-saturated market with a lot of home health care services out there, you must have a lot of competition to face.

However, a strong marketing analysis on home care services business plan can save you and drive you to penetrate the market in the short term. You need to figure out the weak point of your competitors and make proper marketing strategies.

For better insight, consider the following home health care business plan example in this segment.

The Wheatland Home Health Care Agency’s customer base would generally consist of patients who are referred by health care facilities, physicians, and other professionals in the industry. Only a small percentage of patients will be covered by any private insurance company because most of them will be insured by Medicare.

For the Personal Injury Case Management part of our business plan for domiciliary care agency , the customer base generally includes the patients who have been injured in any kind of accident or in the job. These patients will usually get referred from lawyers looking for case management services for them or insurance providers seeking help to mitigate the loss of their clients and injuries.

Market Trends

The target customers of personal injury case management, as well as home health care agency business plans , usually don’t do comparison shopping directly. They usually prefer the health care providers who are referred by their physicians.

When it comes to assessing competition in the field of home health care, the most vital aspect here is consulting with other professionals and asking them to refer their clients to your agency. For doing this, your agency should provide the best patient care and showcase professional business management and organization, and pertinent and current qualifications. It will help you to capture most of the personal injury case management and home healthcare market in your respective area.

Marketing Segmentation

The target market for home health care business should be an aging population who prefer to stay in their homes most of the time and go out mostly for seeing doctors instead of being admitted to a nursing home. Your target market should cover especially the patients who are aging and need proper health care services from a well-trained nursing team. They may also call for other home care services like social work, to gather important resources from the community.

Next up, you may want to target the people who need personal injury case management solutions. You can help them in dealing with financial, medical, and work-related issues.

Since you are specialized in community-oriented services and home health care services, your target should be the segments where your services are needed the most. By working for those market segments, which need home care services only, you can save overhead expenses significantly, as you will not have to set up another office space.

Product Pricing

When acquiring home health care services, trust is the major aspect for both referring professionals and customers. They should have faith in your home care service for reliability, professionalism, and quality.

The customer’s choices do not get affected with the pricing of your services. A lot of those services are covered under Medicaid, Medicare, and private insurance providers and the rates are set by them.

Pricing is a very determining factor for personal injury case management. It varies from case to case and is paid on an hourly basis, which is subject to negotiation. When it comes to providing personal injury case management, the pricing would be estimated on the total time required for the client.

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Home Health Care Marketing Strategy

So you have developed a full-fledged domiciliary care agency business plan and go through all the complex processes of Medicare and state certificate. You have also recruited experienced professionals.

The next thing to consider in a free business plan for home health care agency is the way to attract clients. This is where you need proper marketing strategies to ensure success.

Competitive Analysis

In this free home health care agency business plan , we will start with your competitive edge. If you have learned a lot of daily administrative duties and have experience in home care agency business plan , you can make it successful. Your reputation can help you build a solid client base even before starting your home care agency business plan .

Sales Strategy

Here, you need to provide the best patient service and ensure complete satisfaction from referring to healthcare facilities and physicians.

Sales Monthly

This part should contain your projected monthly sales in home  care agency business .

Sales Yearly

Define annual projected sales from your home care agency business  for three years in this section.

Sales Forecast

It reflects the conservative average of your patients during the first year along with modest year-by-year rise. It should be based on the total patients you are seeing currently in your home health care business.

Personnel plan

In this sample business plan for home care agency, the following points should explain your staff requirements, benefits, and costs needed to hire them. You should also consider the cost of living of employees without affecting your administration. Project the growth of the client base without any impact on payroll because of increased working hours.

Company Staff

In this part of home health care agency business plan free, explain the number of employees as well as who will be hired for what services and for how many hours.

Average Salary of Employees

This part should contain the breakdown of an average salary of each employee in your organization for the next three years.

Financial Plan

As discussed, you may want to use your cash flow to finance your growth. It will ensure slow but steady growth. The collection of dues plays a very vital role in non-medical home care business profits. The services will be mainly reimbursed by insurance providers.

Important Assumptions

The assumptions table showcases major annual assumptions based on tax rates, interest rates as well as staff requirements. For example, we assume no major recession and strong economy, as well as no major and unexpected change in federal policy.

Brake-even Analysis

In a home health care agency business plan , the brake-even analysis is based on Average Variable cost (per unit) and fixed monthly costs.

Projected Profit and Loss

You need to project the overall profit and loss, with sales, rise over the next three years and profits should be notable in the beginning. Also, project your expenses and primary costs in providing services on a monthly and annual basis.

Profit Monthly

In this section, you need to show the detailed overview of your monthly profits for the 12 months in the next 3 years.

Profit Yearly

Your investors may also want to know the annual profits your business can make. It will also help you determine the estimate annual profits for the next 3 years

Gross Margin Monthly

You need to show up your gross margin on monthly basis in your home health care agency business plan .

Gross Margin Yearly

For this section, you can mentkon the annual gross margin you are expecting for the next 3 years.

Projected Cash Flow

It should show annual amounts, which are important to your home care agency business plan success. The following table represents cash flow on monthly basis.

Projected Balance Sheet

The projected balance sheet of your home care business should show sufficient net worth growth and healthy financial state.

Business Ratios

The projected business ratios should be based in comparison with home health care standards. Expect to have healthy ratios for risk, profitability, and returns.

Download Home Health Care Business Plan Sample in pdf

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HVAC Business Plan Template

Written by Dave Lavinsky

HVAC Business Plan

You’ve come to the right place to create your HVAC business plan.

We have helped over 1,000 entrepreneurs and business owners create business plans and many have used them to start or grow their HVAC companies.

Below is a template to help you create each section of your HVAC business plan.

Executive Summary

Business overview.

Anderson’s Heating Ventilation & Air Conditioning Company (HVAC) is a startup HVAC company located in Boise, Idaho. The company is founded by Arnie Anderson, a HVAC technician for over 20 years who has now determined the time is right to start his own company. Arnie has worked in every operational position in his former employer’s company and has a strong depth of experience and capability in every aspect of HVAC installation and repair.

The job requires a history of knowledge and thorough expertise of many systems within HVAC; Arnie has learned them all via trial and error or on-site. His customers for the past 20 years have learned to trust Arnie with all replacements or repairs for their HVAC systems, because of both his expertise and his encouraging and calm demeanor when dealing with difficult, sometimes emergency, situations.

Product Offering

The following are the services that Anderson’s Heating Ventilation & Air Conditioning Company will provide:

• Provide high-quality service in HVAC installation and repair for residential customers
• Use a “set-window” time frame for HVAC commercial customers in need of repair
• Utilize digital platforms as technical assistance tools for diagnostics and repairs
• Service industrial clients with infrastructure over 100,000 square feet
• Provide distinctive service to high-demand contractors, real estate agencies, and property management companies who require HVAC replacements or repairs
• Provide the most up-to-date and innovative HVAC systems and repair service

Customer Focus

Anderson’s Heating Ventilation & Air Conditioning Company will target residential customers in the greater Boise area. They will also target commercial customers. They will search for and service industrial clients with large-space infrastructures. They will target contractors, real estate agencies and property management companies.

Management Team

Anderson’s Heating Ventilation & Air Conditioning Company will be owned and operated by Arnie Anderson. He has recruited two of his former assistants in his prior employment, Tex Rowan and Matt Rogers, to take on positions as Senior Technicians for Anderson’s HVAC. Tex and Matt together have over thirty years of experience as HVAC technicians and can instruct new employees, as well as diagnose, repair or rebuild HVAC systems.

Success Factors

Anderson’s Heating Ventilation & Air Conditioning Company will be able to achieve success by offering the following competitive advantages:

• Friendly, knowledgeable, and highly-qualified team at Anderson’s Heating Ventilation & Air Conditioning Company
• Provide a unique “set-window” urgent-response time frame for HVAC commercial customers
• Anderson’s Heating Ventilation & Air Conditioning Company will offer the best pricing in town. Their pricing structure will be the most cost effective compared to the competition.

Financial Highlights

Anderson’s Heating Ventilation & Air Conditioning Company is seeking $200,000 in debt financing to launch its Anderson’s Heating Ventilation & Air Conditioning Company. The funding will be dedicated toward securing the office space and purchasing office equipment and supplies. Funding will also be dedicated towards three months of overhead costs to include payroll of the staff, rent, and marketing costs for the print ads and marketing costs. The breakout of the funding is below:

• Office space build-out: $20,000
• Office equipment, supplies, and materials: $10,000
• Three months of overhead expenses (payroll, rent, utilities): $150,000
• Marketing costs: $10,000
• Working capital: $10,000

The following graph outlines the financial projections for Anderson’s Heating Ventilation & Air Conditioning Company.

Company Overview

Who is anderson’s heating ventilation & air conditioning company.

Anderson’s Heating Ventilation & Air Conditioning Company is a newly established full-service HVAC company in Boise, Idaho. Anderson’s Heating Ventilation & Air Conditioning Company will be the most reliable, cost-effective, and efficient choice for residents, commercial customers, and industrial clients within Boise and the surrounding communities. Anderson’s Heating Ventilation & Air Conditioning Company will provide a comprehensive menu of diagnostic and repair services for any client to utilize. Their full-service approach includes a unique service that provides “set time” responses for commercial clients with urgent HVAC needs.

  Anderson’s Heating Ventilation & Air Conditioning Company will be able to provide distinctive, high-quality replacements and repairs to all residents and commercial establishments. The team of professionals are highly qualified and experienced in HVAC processes and can provide either replacements, when necessary, or repair within a short window of time. Anderson’s Heating Ventilation & Air Conditioning Company removes all headaches and issues of the problems that can occur with HVAC systems, particularly in extremely cold winter weather. The unique response time system of Anderson’s HVAC ensures all issues are taken care of expeditiously while delivering the best customer service.

Anderson’s Heating Ventilation & Air Conditioning Company History

Since incorporation, Anderson’s Heating Ventilation & Air Conditioning Company has achieved the following milestones:

• Registered Anderson’s Heating Ventilation & Air Conditioning Company, LLC to transact business in the state of Idaho.
• Has a contract in place at one of the office buildings in midtown Boise.
• Will set up its 10,000 square foot office space
• Reached out to numerous contacts and former clients to consider services from Andersons HVAC.
• Began recruiting a staff of ten and office personnel to work at Anderson’s HVAC company.

Anderson’s Heating Ventilation & Air Conditioning Company Services

The following will be the services Anderson’s Heating Ventilation & Air Conditioning Company will provide:

Industry Analysis

The heating, ventilation, and air conditioning service industry is expected to grow over the next five years to over $309 billion. The growth will be driven by the population increases which continue to create a need for HVAC replacement and repairs. The growth will be driven by the innovative new HVAC systems and products, such as the tankless water heater, that will be requested by customers who desire a more sustainable environment for their homes. The growth will be driven by innovation not-yet-known, as older materials and processes give way to newer high-tensile products that can replace steel wraps, tanks and ducts. Costs will likely be reduced as the worldwide economy continues to remain at a healthy level and commerce is not detained by political forces.

Customer Analysis

Demographic profile of target market.

Anderson’s Heating Ventilation & Air Conditioning Company will target residential and commercial clients in Boise, Idaho. They will search for and service industrial clients with large-space infrastructures. They will target contractors, real estate agencies and property management companies.

Customer Segmentation

Anderson’s Heating Ventilation & Air Conditioning Company will primarily target the following customer profiles:

• Residents of Boise region
• Commercial clients of greater Boise area
• Industrial clients (100,000 square foot facilities) in the greater Boise region
• Real estate agencies, contractors and property management companies in Boise

Competitive Analysis

Direct and indirect competitors.

Anderson’s Heating Ventilation & Air Conditioning Company will face competition from other companies with similar business profiles. A description of each competitor company is below.

Middleton HVAC Company

The Middleton HVAC Company is headquartered approximately 30 miles from Boise, Idaho. The company has been in business for five years, providing installations of new water heaters for the fast-growing bedroom communities of Boise. The owner, Mitch Carter, has extensive experience in water heater installation, having formerly worked for a company that manufactures and installs water heaters. He, along with two employees, work on new home construction, assembling and installing water heaters on a large volume basis.

The Middleton HVAC Company does not specialize in installation, repair or replacement of heating, ventilation or air conditioning units; however, the water heaters are heavily prominent in the business and some HVAC work is also completed for select clients. This company is focused on new home starts; as such, the next Middleton community is on their radar for sales and installation purposes. The company installs basic water heaters, without offering tankless water heaters, and includes typical instructions and safety warnings with those heaters. Repairs are often secondary to installation, which has led to some first-time homeowner complaints.

COC Company

The COC Company is an abbreviation of the full company name: Cooling Or Cold Company, which describes the installation, replacement or repairs offered by this company. Because of heat during the summer, cooling systems are required. The extreme cold during the winters in Idaho create the need for operational heating systems. These two weather patterns drive the systems comprising the scope of installation and servicing of the COC Company.

The COC Company is owned and operated by Tabor Nugent, who started the business in 2010. Since that time, he has hired one additional service repair representative and two administrative office staff. Tabor has found a niche in hot and cold weather systems, which he believes are the solutions for the weather patterns of the Boise region.

Thomas & Marsh HVAC Company

Thomas & Marsh HVAC Company was established in 1995 and has been a part of the Boise, Idaho community in several interactive ways throughout the years. The company has built and maintained an active community within area company owners and has started various associations to support local businesses. Terry Thomas is the owner and president of the company, and handles most of the client relations. Matt Marsh is the vice president of the company, overseeing the scheduling and other operations duties. Both Terry and Matt are active in the community organizations, encouraging camaraderie among all businesses.

In 2010, Thomas & March HVAC placed all services into a “mobile repair” mode, which resulted in increased customer calls for urgent repairs in cold weather or other electrically-challenged situations. This created a following of clients who continue to use the mobile repair service rather than calling a competitor, as the impression given to clients is that the repairs will be available within minutes instead of within hours.

Competitive Advantage

Anderson’s Heating Ventilation & Air Conditioning Company will be able to offer the following advantages over their competition:

Marketing Plan

Brand & value proposition.

Anderson’s Heating Ventilation & Air Conditioning Company will offer the unique value proposition to its clientele:

• Highly-qualified team of skilled employees who are able to provide the most up-to-date and innovative HVAC systems and repair service.
• Provide a unique “set-window” urgent-response time frame for HVAC customers
• Unbeatable pricing for clients; creating the best pricing options available

Promotions Strategy

The promotions strategy for Anderson’s Heating Ventilation & Air Conditioning Company is as follows:

Word of Mouth/Referrals

Anderson’s Heating Ventilation & Air Conditioning Company is owned by Arnie Anderson, who has built up a stellar reputation as an installation, replacement, and repair expert in the HVAC industry. His long and extensive list of clients over the years has been bolstered by recent publicity after Arnie saved a family from extreme danger when searching for a systemic leak. By providing exceptional service and expertise to his clients, Arnie can now ask former clients to spread the word about Anderson’s Heating Ventilation & Air Conditioning to help build his company rapidly.

Professional Associations and Networking

Boise, Idaho is a medium-sized city and, as such, is a community-focused one, as well. Neighbors are friends, as are repair personnel, installation teams, construction groups and others. Arnie Anderson intends to solicit new customers and network among several groups for the first time since starting his company, as he knows referrals and word-of-mouth comments will lead to the success of his company.

Print Advertising

Two weeks before the launch of the company, a direct mail item will be sent to every resident in Boise, inviting all to take part in special “launch prices” during the first two weeks of the grand opening of the company. Customers are invited to visit and get a discount voucher for installation, replacement or repair of HVAC systems.

Website/SEO Marketing

Anderson’s Heating Ventilation & Air Conditioning Company will utilize their website, which will be well-organized, informative, and provide a list of services that Anderson’s Heating Ventilation & Air Conditioning Company is able to offer. The website will also list their contact information and list their available times if customers want to schedule a visit. The website will use SEO marketing tactics so that anytime someone types in the Google or Bing search engine “HVAC company” or “HVAC repair near me”, Anderson’s Heating Ventilation & Air Conditioning Company will be listed at the top of the search results.

The pricing of Anderson’s Heating Ventilation & Air Conditioning Company will be moderate and on par with competitors so customers feel they receive excellent value when purchasing their services.

Operations Plan

The following will be the operations plan for Anderson’s Heating Ventilation & Air Conditioning Company. Operation Functions:

• Arnie Anderson will be the Owner and President of the company. He will oversee all staff and manage client relations. Arnie has spent the past year recruiting the following staff:
• Tex Rowan, a former associate of Arnie’s in his former position, will be a Senior Technician who will train new technicians and install, repair and replace HVAC equipment.
• Matt Rogers, a former associate of Arnie’s in his former position, will also be a Senior Technician who will oversee scheduling and operations of the team as a whole.
• Carrie Swanson will be the Office Manager, handling service calls, daily administration duties and assisting the technicians as needed.

Milestones:

Anderson’s Heating Ventilation & Air Conditioning Company will have the following milestones completed in the next six months.

• 5/1/202X – Finalize contract to lease office space
• 5/15/202X – Finalize personnel and staff employment contracts for the Anderson’s Heating Ventilation & Air Conditioning Company
• 6/1/202X – Finalize long-term contracts for Anderson’s HVAC Company clients
• 6/15/202X – Begin networking at industry events
• 6/22/202X – Begin moving into Anderson’s Heating Ventilation & Air Conditioning Company office
• 7/1/202X – Anderson’s Heating Ventilation & Air Conditioning Company opens its office for business

Arnie Anderson has recruited two of his former assistants in his prior employment, Tex Rowan and Matt Rogers, to take on positions as Senior Technicians for Anderson’s HVAC. Tex and Matt together have over thirty years of experience as HVAC technicians and can instruct new employees, as well as diagnose, repair or rebuild HVAC systems.

Financial Plan

Key revenue & costs.

The revenue drivers for Anderson’s Heating Ventilation & Air Conditioning Company are the fees they will charge to their customers for their products and services.

The cost drivers will be the overhead costs required in order to staff Anderson’s Heating Ventilation & Air Conditioning Company. The expenses will be the payroll cost, rent, utilities, office supplies, and marketing materials.

Funding Requirements and Use of Funds

Anderson’s Heating Ventilation & Air Conditioning Company is seeking $200,000 in debt financing to launch its HVAC company. The funding will be dedicated toward securing the office space and purchasing office equipment and supplies. Funding will also be dedicated toward three months of overhead costs to include payroll of the staff, rent, and marketing costs for the print ads and association memberships. The breakout of the funding is below:

Key Assumptions

The following outlines the key assumptions required in order to achieve the revenue and cost numbers in the financials and in order to pay off the startup business loan.

• Number of customers Per Month: 165
• Average fees for products and services per Month: $44,500
• Office Lease per Year: $100,000

Financial Projections

Income statement, balance sheet, cash flow statement, hvac business plan faqs, what is an hvac business plan.

An HVAC business plan is a plan to start and/or grow your HVAC business. Among other things, it outlines your business concept, identifies your target customers, presents your marketing plan and details your financial projections.

You can easily complete your HVAC business plan using our HVAC Business Plan Template here .

What are the Main Types of HVAC Businesses? 

There are a number of different kinds of HVAC businesses , some examples include: Residential HVAC company, Commercial HVAC company, and Industrial Company.

How Do You Get Funding for Your HVAC Business Plan?

HVAC businesses are often funded through small business loans. Personal savings, credit card financing and angel investors are also popular forms of funding.

What are the Steps To Start an HVAC Business?

Starting an HVAC business can be an exciting endeavor. Having a clear roadmap of the steps to start a business will help you stay focused on your goals and get started faster.

1. Develop an HVAC Business Plan - The first step in starting a business is to create a detailed HVAC business plan that outlines all aspects of the venture. This should include potential market size and target customers, the services or products you will offer, pricing strategies and a detailed financial forecast. 

2. Choose Your Legal Structure - It's important to select an appropriate legal entity for your HVAC business. This could be a limited liability company (LLC), corporation, partnership, or sole proprietorship. Each type has its own benefits and drawbacks so it’s important to do research and choose wisely so that your HVAC business is in compliance with local laws.

3. Register Your HVAC Business - Once you have chosen a legal structure, the next step is to register your HVAC business with the government or state where you’re operating from. This includes obtaining licenses and permits as required by federal, state, and local laws.

4. Identify Financing Options - It’s likely that you’ll need some capital to start your HVAC business, so take some time to identify what financing options are available such as bank loans, investor funding, grants, or crowdfunding platforms.

5. Choose a Location - Whether you plan on operating out of a physical location or not, you should always have an idea of where you’ll be based should it become necessary in the future as well as what kind of space would be suitable for your operations.

6. Hire Employees - There are several ways to find qualified employees including job boards like LinkedIn or Indeed as well as hiring agencies if needed – depending on what type of employees you need it might also be more effective to reach out directly through networking events.

7. Acquire Necessary HVAC Equipment & Supplies - In order to start your HVAC business, you'll need to purchase all of the necessary equipment and supplies to run a successful operation.

8. Market & Promote Your Business - Once you have all the necessary pieces in place, it’s time to start promoting and marketing your HVAC business. This includes creating a website, utilizing social media platforms like Facebook or Twitter, and having an effective Search Engine Optimization (SEO) strategy. You should also consider traditional marketing techniques such as radio or print advertising. 

Learn more about how to start a successful HVAC business:

• How to Start an HVAC Business

How to Write an HVAC Business Plan + Free Sample Plan PDF

Elon Glucklich

8 min. read

Updated February 16, 2024

Download: Free one-page HVAC sample business plan

No one wants to spend hours living or working in sweltering heat or bitter cold.

Over 3 million heating and air conditioning systems are replaced in the United States each year. As a result, the HVAC industry employs 1.5 million people and generates over $150 billion in annual revenue.

There are plenty of opportunities for skilled technicians looking to start or grow an HVAC installation and maintenance business. But just because demand is high, it doesn’t mean that anyone who knows how to install equipment can successfully enter the market.

Writing a business plan will help you align your services with the opportunity in your area. It also matches your vision for the business with your financial resources. And you’ll need to write a plan if you’re seeking a bank loan or investment for your business.

This article will help ensure that your plan includes the right information and supporting data to highlight your HVAC business, and convince investors that you’ll run an efficient operation that’s profitable over the long term.

• What should you include in an HVAC business plan?

Don’t get too hung up on trying to hit a certain number of pages in your business plan. Just focus on the aspects of your plan that are most important based on what you want your plan to accomplish. If you’re looking for in-depth guidance, Bplans can guide you through writing your full business plan in detail .

In this article, we’ll cover a few of the business plan components you’ll likely include in your HVAC business plan:

• Executive Summary
• Market Analysis
• HVAC Services and Pricing
• Operations Plan
• Marketing and Sales Strategy
• Company Summary and Funding Needs
• Financial Plan and Forecasts

As you write your plan, be sure to consider the full range of services you might be able to offer customers. For instance, you might not only provide installation, maintenance, and repair services but also sell HVAC units, smart thermostats and related products. 

Including all these possibilities in your plan will help you determine the feasibility of adding revenue streams and opportunities to enhance customer value through product sales alongside your services. Just make sure your plan details strategies for providing whichever services you decide to offer.

Here’s an example of an HVAC business plan outline.

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• The 7 elements of an effective HVAC business plan

1. Executive summary

The executive summary outlines the broad vision and opportunity for your HVAC business. It provides readers with a brief, high-level overview of your plan, one that emphasizes your unique value proposition and competitive advantages.

Write a mission statement , which describes the purpose of your business. Maybe you aim to provide energy-efficient and environmentally sustainable HVAC systems. Or perhaps you provide top-notch customer service for both residential and commercial customers.

Touch on key factors for the success of your business, like your location, service offerings and staff.

2. Market analysis

Without understanding the needs of customers in your target area, you won’t know which products or services will generate the most sales.

That’s why conducting a thorough market analysis is crucial. What do homeowners and commercial landlords in your area need? If you’re in a warm climate, air conditioning systems will be in high demand. But a cold-weather market will drive demand for heating systems. Other factors to consider include the age and condition of buildings in your service area. 

Researching the market helps identify your target customer segments and understand their specific needs and preferences. This analysis should cover demographic details, purchasing behaviors, and the size of your target market . Additionally, provide an overview of the competitive landscape , identifying key players and their market positioning. Highlight industry trends, such as the growing demand for energy-efficient systems that support the potential success and relevance of your HVAC business.

3.  HVAC services and pricing

List the full range of HVAC services your business plans to provide, such as installation, maintenance, and repair services for heating, ventilation, and air conditioning systems.

You should also outline your pricing strategy . Detail how you intend to offer competitive rates while ensuring profitability. Whether you adopt a value-based pricing model or a cost-plus approach, this section should explain how your pricing aligns with market expectations and customers’ willingness to pay.

4. Operations plan

Finding customers is one challenge. Once you have them, you’ll need a solid operations plan to ensure you can meet their needs. This section of your plan details the day-to-day operational aspects of your business.

You’ll need to account for delivering your HVAC services and all of the related logistics of service delivery, the equipment required, and any business policies or standards you intend to implement. If you have employees, spend time in this section covering how you will coordinate with them to ensure they have the right equipment and information when they head to a job site.

5. Marketing and sales strategy

Your marketing and sales strategy expands on your market research. This section outlines the methods you’ll use to attract and retain customers.

You should start by identifying the most effective marketing channels for reaching your target market. Take a look at how other HVAC companies are promoting their services. Are they advertising online , or on TV and radio? Do they have active social media presences, or are they relying on more traditional methods like printed flyers or partnerships with real estate agencies?

Once you understand where your target audience gets information about HVAC services, write down your strategies for investing in these marketing and sales channels. Try to include estimated costs and projected return on investment for each channel.

Remember, different product and service offerings might require different marketing tactics. For instance, you might want to promote the energy efficiency aspects of your service online. But customers seeing your ads on television might be more interested in your pricing versus competitors.

6. Company summary

In the business overview section, detail your business model , including the legal structure and geographical location of your operation. 

Briefly list the range of HVAC services you offer. You’ve already provided details on these in the services and pricing section, but the company overview is where you explain how these services address specific customer needs or market gaps. This part of the plan should clearly articulate the problems your business solves, emphasizing the value and reliability your company brings to the HVAC market.

You can also include a bit about your management team, highlighting the key roles and the expertise each member brings to the HVAC industry. And if you’re seeking bank or investor funding for your business, you can lay out the funding request and explain how you intend to use the funds here.

7. Financial Plan

The financial plan should present detailed financial projections for your HVAC business, giving a reader an understanding of how you expect the business to perform in the short and long term.

Include revenue , costs , and profitability , as well as a cash flow statement , income statement , and balance sheet .

If you’re starting a new business, provide details on startup costs , revenue streams, and funding requirements.

Remember, forecasts are just educated guesses. At the same time, the goal of your financial plan is to demonstrate your cleaning service’s ability to generate a profit. If your numbers don’t show a pathway to profitability, you may need to rethink your service offerings or marketing strategy.

• Key considerations for writing an HVAC business plan

Building supplier relationships and managing how cash moves in and out of your business is essential. So is understanding what your customers want. To write an HVAC business plan that helps you streamline operations, reduce wasteful spending, or get a bank loan, consider addressing these points.

1. Go deep with your market research

Utilize data from public sources like the U.S. Census Bureau to drill down on the number of households in your area. You can also use Google to research commercial properties in your area that might need HVAC services, like office buildings or retirement homes.

2. Make your credentials clear

Highlight your team’s expertise, certifications, and accreditations. They serve as proof of your credibility to clients, lenders and investors.

3. Professional training and standards

Document your plans for committing to ongoing training on the latest HVAC technologies and safety standards.

4. Supplier relationships and inventory

Detail your plans for sourcing your HVAC systems, and how you’ll store the systems before delivering them. Also, describe your logistical arrangements for job site deliveries, including transportation needs, such as whether you will need a company van.

5. Accounts receivable and accounts payable

It’s likely you won’t immediately be paid in full for your services. Make sure you account for this in your forecasts. Incorporate realistic financial projections considering delayed payments for services and the gradual settlement of equipment expenses.

• Download your free HVAC one page sample business plan

Download your HVAC business plan sample now for free, or explore the Bplans gallery of over 550 sample business plans if you want to see plans for other industries.

Writing a business plan for your HVAC business boosts your chance of success for a variety of reasons . We’ve mentioned its importance if you’re seeking a loan or investment. But just going through the process of thinking through each aspect of your operation will help make sure you don’t leave any stone unturned as you build a successful business.

Elon is a marketing specialist at Palo Alto Software, working with consultants, accountants, business instructors and others who use LivePlan at scale. He has a bachelor's degree in journalism and an MBA from the University of Oregon.

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