The 7 Step Business Plan for a Medical Staffing Agency
April 22, 2021
A strong business plan can make or break a new startup. Therefore, if you’re looking to open a healthcare staffing agency, a solid business plan should be your first port of call.
Not only does it provide a clear road map for getting your business up and running, it’s also the first step in applying for a business loan. Furthermore, with so much to handle from financing to legal protection, the act of writing it all down with actionable steps can take a huge load off your mind and make that mountain ahead seem a lot easier to climb
To help you in your journey, we’ve outlined below in seven easy steps how you can create a business plan for a medical staffing agency.
1. Outline Your Business Goals and Purpose
Start by writing out in clear terms what your business goals are for starting a healthcare staffing agency.
It should be concise and easy to understand. Furthemore, If you’re going to be applying for a business loan, this is your chance to lay out why you’ll need the funds and what your growth targets are.
2. Decide on the Type of Business You’ll Be Running
Every staffing agency must decide on the type of ownership structure it will operate under. You have a few options, and each have their own pros and cons. Take some time to decide which one might work best for you depending on your personal and business goals.
- Sole Proprietorship – This is where one person owns the entire business under their own name. Any debts or liabilities that the business takes on are the sole personal responsibility of the owner.
- Joint Partnership – When two or more people open a business together, they enter into a partnership. Depending on the arrangement, each owner may hold an equal or different share in the business. All debts and liabilities are still considered personal.
- A Limited Liability Company – An LLC comes with significant tax benefits and can be opened under sole proprietorship or joint partnership. Another benefit to this arrangement is that it offers the legal protection of being a corporation.
- A Corporation – Functions much the same as an LLC, with the important difference that it is owned by its shareholders, whereas an LLC is owned by one or more individuals.
Whatever type of business you decide on, keeping track of employee time and attendance will make your life a whole lot easier. Learn more about our staffing agency software here.
3. Ensure Liability Protection
As a nurse staffing agency, you’re in a rather unique position regarding legal protection. Your staff will be working in several different locations, some safer than others and you need to ensure that both they and you have proper protection.
Outline the type of liability insurance you’ll need and how it will protect your company from any damages caused. Since you’re operating in the medical industry, it’s advisable that you go with premium liability insurance.
You’ll also need proper worker’s compensation in case one of your employees suffers an injury on the job. Your insurance program should cover both medical costs and rehabilitation. As an added bonus, it may also be worth getting short or long-term disability insurance on top of the base package.
4. Investigate Funding Options
Whatever agency you operate within, when you first get started, you’ll likely be operating out of a spare room.
Furthermore, for the first few months, as you try to hire staff and find clients, your business will probably be in the red, financially speaking.
This is perfectly normal. That being said, eventually you’re going to have to find extra funding before your business can really take off. Employees will have to be paid before you even have clients and you’ll have advertising, recruiting, and operating costs to cover.
To get yourself through these first early months, outline a plan for how you will fund your business venture. Some of it can come from your own personal savings, but in all likelihood, you’re going to need a business loan to cover the rest. Research what loan options are available and what the requirements are to be approved.
5. Make Revenue Projections
Key to the success of any business venture is an accurate revenue projection. This will be crucial when it comes time to apply for a business loan, so lay out your expected earnings for each month and yearly quarter for the first 2-3 years. It should be properly cited with market reports and financial statements to back up your projections. Be aggressive in your goals, but also realistic. Your loan officer will want to see clear evidence that you can cover your monthly loan payments and any other debts or liabilities you may have taken on.
This is also a good time to think about how you can achieve critical mass, the point at which you have enough staff and clients that your business becomes self-sustaining. When you first get started, you’ll be operating on a shoestring budget and largely dependent on whatever funding you could get.
Try to get a clear sense of how much you’ll need to grow before you can compete in the medical market effectively and remain competitive. Your point of critical mass will be an ever-changing target, so be aware that you’ll need to revise it over time. The revenue projections you make will have a direct impact on the balance between your medical staffing agency’s bill rate vs pay rate.
Revenue projections and medical staffing analysis is made easier by using our staffing agency software. Learn more here.
6. Develop a Marketing Plan
This is where you will lay out your marketing plans and how you intend to achieve them. You’ll need to outline two marketing plans, one for attracting medical employees and another for clients.
For your medical employees, brainstorm a bunch of ideas for how you can draw talent. For instance, reach out to local schools that specialize in nursing and medical care. You could even try teaming up with a local faculty to encourage new graduates to join your agency. Other methods for finding staff include reaching out on social media or asking medical staff you already have on the books to reach out through their connections and pitch job offers.
As for clients, draw up a list of all the nearby hospitals, health clinics, and anywhere else that needs medical staff. These will be the targets for your marketing campaign, and you should have a clear idea for how you can attract their business.
If you have a unique selling proposition (USP), this is your chance to showcase it and explain how you will compete with other staffing agencies. You should also research any educational events in your area. Medical personnel are always in need of continuing education credits to maintain their professional licenses, and these events can be a great place to find both new recruits and new business clients.
7. Bring It All Together
Type out everything in a single document with each area categorized and properly indexed. It should be easy to present to lenders and provide a clear blueprint for how your business will operate and grow in the future. A basic business plan should include the following:
- An executive summary
- Company ownership structure and financing
- Market analysis and business plan
- Pricing model and marketing plan
- An appendix section listing supporting information
There you have it! While there is no blueprint for how to open a healthcare staffing agency, if you follow these 7 steps your chance of success will drastically increase.
Once you’re up and running, make sure you finalize your temp agency markup rates to ensure you’re profitable but don’t price yourself out of the market.
Furthermore, to offer unique value and attract the best medical professionals, invest in staffing agency software in order to streamline your time and attendance, payroll and HR.
Want to learn more about how Timerack can benefit your medical staffing agency? Book a personalized demo here.