Table of Content

    Occupational therapy business plan for starting your own business

    If you want to know how to open an occupational therapy business, you are in the right place. We will give you all the information and guidance for nonprofit business planning as well as for-profit. Our business plan for physical therapy has helped a lot of people start their own business.

    Occupational therapy is a field of health sciences. It is focused at helping people correct mental and behavioral irregularities using meaningful activities (occupations) that are imparted in their daily routine. We will have a look at how Alpha Occupational Therapy plans to be the leader of the industry.

    Executive Summary

    2.1 The Business

    Alpha Occupational Therapy will be a registered business in Seattle. It will be owned by Dr. William Petronas. William is a retired psychiatrist who has conducted substantial research in the field of behavioral therapy and interventions.

    2.2 Management of Occupational Therapy Business

    For starting an occupational therapy business, it is of paramount importance to make a strong management plan. William will hire an experienced CEO to manage the business. As there are two faces of the business, operations and public relations, experts will be hired to take care of both. This document will tell you in sheer detail how to start an occupational therapy business and make it successful.

    We’ll also tell you how to get a non profit occupational therapy business license.

    2.3 Customers of Occupational Therapy Business

    This is not as simple as a pharmacy business plan. To make the strategic business plan for this business, we need to know the customers first. The main customers of this business will be:

    • People who want to improve their lives by therapy.
    • People who want to get a loved one treated.
    • Institutions that want their employees to get therapy.

    2.4 Business Target

    The business target is:

    • To expand to two more states in 2 years.
    • To start making $29.8k in profits per month by the end of three years.

    Occupational Therapy Business Plan - 3 Years Profit Forecast

    Company Summary

    3.1 Company Owner

    William Petronas, the owner of the company is one of the most renowned psychiatrists in the state of Washington. He was one of the very first practitioners to make occupational therapy available for the masses. However, business and management are out of his scope and to make this occupational therapy business plan example successful he’ll hire a CEO.

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    3.2 Why the Occupational Therapy Business is being started

    William is starting this business because he’s passionate about it. He has worked in this field all his life. He is like a star of this field. However, just like a Herbalife business plan there is a financial aspect too.

    3.3 How the Occupational Therapy Business will be started

    Step1: Plan Everything

    The first step in making this sample occupational therapy business plan is planning. Williams will start this business after extensive planning. This consulting business plan template occupational therapy will cover all the aspects of planning needed.

    Step2: Making a Brand

    People these days are brand conscious. In order to make this business successful, a brand needs to be developed. The focus of making the brand will be around how occupational therapy can change your life for good.

    Step3: Establishing a Clinic

    Once the brand has been established, the next step will be to establish a clinic where the clients will visit. This clinic will need to be at par with the services provided in it.

    Step4: Establish Online Presence

    Going online is the most important thing. If you want your business to be noticed, you’ll have to create an online presence. This will be done using a website and social media pages on all the notable platforms.

    Step5: Marketing

    A solid marketing plan will be developed to make sure that the people of Seattle know Alpha Occupational Therapy exists.

    Occupational Therapy Business Plan - Startup Cost

    Start-up Expenses  
    Legal $248,000
    Consultants $0
    Insurance $30,000
    Rent $29,000
    Research and Development $30,000
    Expensed Equipment $51,000
    Signs $4,000
    TOTAL START-UP EXPENSES $392,000
    Start-up Assets $340,000
    Cash Required $350,000
    Start-up Inventory $51,000
    Other Current Assets $230,000
    Long-term Assets $250,000
    TOTAL ASSETS $1,221,000
    Total Requirements $1,613,000
    START-UP FUNDING
    Start-up Expenses to Fund $392,000
    Start-up Assets to Fund $1,221,000
    TOTAL FUNDING REQUIRED $1,613,000
    Assets
    Non-cash Assets from Start-up $1,612,000
    Cash Requirements from Start-up $369,000
    Additional Cash Raised $52,000
    Cash Balance on Starting Date $33,000
    TOTAL ASSETS $2,066,000
    Liabilities and Capital
    Liabilities $30,000
    Current Borrowing $0
    Long-term Liabilities $0
    Accounts Payable (Outstanding Bills) $41,000
    Other Current Liabilities (interest-free) $0
    TOTAL LIABILITIES $71,000
    Capital
    Planned Investment $1,613,000
    Investor 1 $0
    Investor 2 $0
    Other $0
    Additional Investment Requirement $0
    TOTAL PLANNED INVESTMENT $1,613,000
    Loss at Start-up (Start-up Expenses) $382,000
    TOTAL CAPITAL $1,995,000
    TOTAL CAPITAL AND LIABILITIES $2,066,000
    Total Funding $1,613,000

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    Services

    No occupational therapy business plan template can be complete without a list of the services the business is going to provide. To deliver the best value to the customers and make profit while you are at it, you need to know how to start your own occupational therapy business.

    Here are the services Alpha Occupational Therapy will be providing:

    • Personal Development Services

    These will cover the bulk of the services provided by the business. These services will be intended for people who are not suffering from any irregularity or medical condition and just want to be the better versions of themselves.

    These services will include:

    • Time management therapy.
    • Focus increasing therapy.
    • IQ improvement therapy.
    • Increasing decision making ability.
    • Specialized Therapy

    Just like any other non-medical home care business plan, this business will also provide services to people with mental problems. These will include:

    • Anger management therapy.
    • Depression mitigation therapy.
    • Mental improvement therapy.
    • Behavioral therapy.
    • Corporate Personal Development Services

    These services will be provided for large corporations who want their employees to be better persons. These services will include behavioral, personal development, stress, and workload management therapies.

    • Occupational Therapy for Hospitals

    Hospitals with in-patient psychiatric wards that do not have occupational therapy services available will be provided with these services which will include all types of therapy needed by people with severe and progressive psychiatric conditions.

    Marketing Analysis of Occupational Therapy Business

    Note

    It is a must to have proper business models occupational therapy in order for successfully starting a business as a occupational therapy. Marketing analysis is an immensely important part of this.

    Business Plan for Investors

    Occupational therapy is not an entirely new concept. The idea came into being in 1917. As of now it is a $26.1 billion market in the US. The business has grown from “a therapy for the rich” to an essential healthcare profession. Large corporations, schools, and even hospitals hire occupational therapists to provide the services. You need to have some really radical and innovative occupational therapy business ideas to start this business and make it profitable.

    5.1 Market Trends

    Just like a cannabis cultivation business plan, the occupational therapy business has just recently boomed. The market started flourishing after the financial crisis of 2008. As a lot of people lost their jobs and property, it was a time of widespread mental illnesses. This was the time when occupational therapy proved itself and came forth as a solution to the problem the US was facing at that time. This market is not yet saturated and you can make a name and start a profitable business in this field very easily.

    5.2 Marketing Segmentation

    The market for occupational therapy is a very diverse one. It can be divided into four major segments and each of them is a large one in terms of revenue.

    Occupational Therapy Business Plan - Marketing Segmentation

    5.2.1 Individual Patients

    These are the people who do not have a severe mental condition. These people just want to improve themselves and be better. These patients are the easiest to handle and pay substantially. However, there are not much of such patients as occupational therapy is still largely thought of as a treatment and not as a method of self-improvement.

    5.2.2 Schools

    This is an emerging market segment for occupational therapy service providers. Schools hire occupational therapists to help the children who need special care. Children with anger issues and those suffering with PTSD also need the services which makes this segment a profitable one.

    5.2.3 Corporate Clients

    This is also a market segment for occupational therapy that has bulk of clients. Large corporations have realized the importance of occupational therapy and hire therapists to improve their employees. We will focus on such clients as they work with the therapists on a long-term basis and offer the best prices.

    5.2.4 Hospitals

    Some hospitals do not have occupational therapy experts, but they do need the services. They can be a good source of cases in bulk and for long time. We will be dedicating a whole part of the company to serve these clients.

    Market Analysis
    Potential Customers Growth Year 1 Year 2 Year 3 Year 4 Year 5 CAGR
    Individual Patients 32% 32,000 34,000 35,000 37,000 39,000 10.00%
    Schools 23% 25,000 26,000 27,000 28,000 30,000 10.00%
    Corporate Clients 24% 21,000 22,000 24,000 25,000 27,000 10.00%
    Hospitals 21% 16,000 17,000 18,000 20,000 21,000 11.00%
    Total 100% 94,000 99,000 104,000 110,000 117,000 10%

    5.3 Business Target

    In this business plan on how to open an occupational therapy business, we’re providing the business targets set by Alpha Occupational Therapy.

    • To be the leading provider of occupational therapy services in the US.
    • To expand to 2 more states by the end of 3 years.
    • To bring innovation in the field of occupational therapy.
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    5.4 Product Pricing

    Our services will be priced at the market average at the start. This will, however, change to a higher-than-average price once we get clients. The average price is being used because we don’t want people to think of us as an inferior brand due to low prices.

    Marketing Strategy

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    The next thing needed to complete this occupational therapy marketing plan is the marketing strategy. This occupational therapy business proposal covers that expect in detail. In order to successfully launch and run this business, the importance of a solid marketing policy is paramount.

    We will run a detailed competitor analysis to see what competitive edge we have and the marketing strategy will be based on that. Let’s have a look at the competitor analysis for this occupational therapy business.

    6.1 Competitive Analysis

    1. No occupational therapy business has an experienced and renowned professional like Dr. William Petronas on their payroll. This will give us an edge.
    2. To make sure that the services provided by our company are impeccable, we will hire the best of the best therapists.
    3. We will market our business as a cheap yet effective way towards a better life and mental health.

    6.2 Sales Strategy

    • We will utilize all the major media channels to advertise our services.
    • We’ll keep the prices low at the start and will offer substantial discounts to earn repeat customers.
    • We will partner up with hospitals and corporate clients who have lot of patients to make sure that we have plenty of work.

    6.3 Sales Monthly

    Occupational Therapy Business Plan - Sales Monthly

    6.4 Sales Yearly

    Occupational Therapy Business Plan - Sales Yearly

    6.5 Sales Forecast

    Occupational Therapy Business Plan - Unit Sales

    Sales Forecast      
    Unit Sales Year 1 Year 2 Year 3
    Personal Development Services 49,000 51,940 55,056
    Specialized Therapy 38,000 40,280 42,697
    Corporate Personal Development Services 35,000 37,100 39,326
    Occupational Therapy for Hospitals 28,000 29,680 31,461
    TOTAL UNIT SALES 150,000 159,000 168,540
    Unit Prices Year 1 Year 2 Year 3
    Personal Development Services $43.00 $49.88 $57.86
    Specialized Therapy $52.00 $60.32 $69.97
    Corporate Personal Development Services $49.00 $56.84 $65.93
    Occupational Therapy for Hospitals $55.00 $63.80 $74.01
    Sales
    Personal Development Services $2,107,000.00 $2,590,767.20 $3,185,607.35
    Specialized Therapy $1,976,000.00 $2,429,689.60 $2,987,546.33
    Corporate Personal Development Services $1,715,000.00 $2,108,764.00 $2,592,936.21
    Occupational Therapy for Hospitals $1,540,000.00 $1,893,584.00 $2,328,350.89
    TOTAL SALES $7,338,000.00 $9,022,804.80 $11,094,440.78
    Direct Unit Costs Year 1 Year 2 Year 3
    Personal Development Services $41.00 $46.00 $53.00
    Specialized Therapy $50.00 $57.00 $65.00
    Corporate Personal Development Services $47.00 $53.00 $61.00
    Occupational Therapy for Hospitals $53.00 $60.00 $70.00
    Direct Cost of Sales
    Personal Development Services $2,009,000.00 $2,389,240.00 $2,917,989.20
    Specialized Therapy $1,900,000.00 $2,295,960.00 $2,775,292.00
    Corporate Personal Development Services $1,645,000.00 $1,966,300.00 $2,398,886.00
    Occupational Therapy for Hospitals $1,484,000.00 $1,780,800.00 $2,202,256.00
    Subtotal Direct Cost of Sales $7,038,000.00 $8,432,300.00 $10,294,423.20

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    Personnel plan

    In order to complete this occupational therapy business plan example, we need to talk about the staff that will be needed to run the business. This is important because just like a physical therapy clinic business plan, this business needs a lot of experienced, educated, and trained staff to operate.

    7.1 Company Staff

    • 1 CEO to head the company.
    • William Petronas himself will be the Chief Operations Officer.
    • 6 Occupational Therapists.
    • 1 Web Developer to make the website and app for the business.
    • 1 Social Media Manager
    • 2 Sales Executives
    • 1 Accountant
    • 1 Driver
    • 1 Receptionist

    7.2 Average Salary of Employees

     Personnel Plan      
    Year 1 Year 2 Year 3
    CEO $15,000 $16,500 $18,150
    Occupational Therapists $68,000 $74,800 $82,280
    Web Developer $10,000 $11,000 $12,100
    Social Media Manager $9,000 $9,900 $10,890
    Sales Executives $20,000 $22,000 $24,200
    Driver $10,000 $11,000 $12,100
    Accountant $11,000 $12,100 $13,310
    Receptionist $7,000 $7,700 $8,470
    Total Salaries $150,000 $165,000 $181,500

    Financial Plan

    If you are wondering how much money is the occupational therapy business worth, it depends on the value of the brand. This is not a dentistry business plan where the equipment and real estate are all what dictate the value of the business. The value of such a business is determined by the level of trust people have in it.

    To start this business, we’ll have to arrange enough money for the following:

    • Renting a place to set up the business.
    • Salaries for the staff for the first 6 months.
    • Money needed to lease 3 field vehicles.
    • Money needed to get the business registered and licensed.
    • Money needed to set up a website and social media pages.
    • Money needed to market and promote the business in the starting phase.

    8.1 Important Assumptions

     General Assumptions      
    Year 1 Year 2 Year 3
    Plan Month 1 2 3
    Current Interest Rate 8.24% 8.25% 8.26%
    Long-term Interest Rate 8.40% 8.41% 8.42%
    Tax Rate 23.90% 23.98% 24.20%
    Other 0 0 0

    8.2 Break-even Analysis

    Occupational Therapy Business Plan - Break-even Analysis

     Break-Even Analysis  
    Monthly Units Break-even 5338
    Monthly Revenue Break-even $132,020
    Assumptions:
    Average Per-Unit Revenue $235.00
    Average Per-Unit Variable Cost $0.66
    Estimated Monthly Fixed Cost $164,100

    8.3 Projected Profit and Loss

     Pro Forma Profit And Loss      
    Year 1 Year 2 Year 3
    Sales $7,338,000 $9,022,805 $11,094,441
    Direct Cost of Sales $7,038,000 $8,432,300 $10,294,423
    Other $0 $0 $0
    TOTAL COST OF SALES $7,038,000 $8,432,300 $10,294,423
    Gross Margin $300,000 $590,505 $800,018
    Gross Margin % 4.09% 6.54% 7.21%
    Expenses
    Payroll $150,000 $165,000 $181,500
    Sales and Marketing and Other Expenses $126,000 $127,000 $128,000
    Depreciation $2,290 $2,340 $2,440
    Leased Equipment $0 $0 $0
    Utilities $2,975 $3,020 $3,110
    Insurance $1,850 $1,930 $2,040
    Rent $3,000 $3,100 $3,200
    Payroll Taxes $31,000 $32,000 $33,000
    Other $0 $0 $0
    Total Operating Expenses $317,115 $334,390 $353,290
    Profit Before Interest and Taxes ($17,115) $256,115 $446,728
    EBITDA ($17,115) $256,115 $446,728
    Interest Expense $0 $0 $0
    Taxes Incurred ($3,423) $51,223 $89,346
    Net Profit ($13,692) $204,892 $357,382
    Net Profit/Sales -0.19% 2.27% 3.22%

    8.3.1 Profit Monthly

    Occupational Therapy Business Plan - Profit Monthly

    8.3.2 Profit Yearly

    Occupational Therapy Business Plan - Profit Yearly

    8.3.3 Gross Margin Monthly

    Occupational Therapy Business Plan - Gross Margin Monthly

    8.3.4 Gross Margin Yearly

    Occupational Therapy Business Plan - Gross Margin Yearly

    8.4 Projected Cash Flow

    Occupational Therapy Business Plan - Projected Cash Flow

     Pro Forma Cash Flow      
    Cash Received Year 1 Year 2 Year 3
    Cash from Operations
    Cash Sales $57,000 $61,560 $66,485
    Cash from Receivables $19,000 $20,520 $22,162
    SUBTOTAL CASH FROM OPERATIONS $76,000 $82,840 $89,467
    Additional Cash Received
    Sales Tax, VAT, HST/GST Received $0 $0 $0
    New Current Borrowing $0 $0 $0
    New Other Liabilities (interest-free) $0 $0 $0
    New Long-term Liabilities $0 $0 $0
    Sales of Other Current Assets $0 $0 $0
    Sales of Long-term Assets $0 $0 $0
    New Investment Received $0 $0 $0
    SUBTOTAL CASH RECEIVED $76,000 $83,000 $90,000
    Expenditures Year 1 Year 2 Year 3
    Expenditures from Operations
    Cash Spending $31,000 $32,000 $33,000
    Bill Payments $21,000 $22,000 $23,000
    SUBTOTAL SPENT ON OPERATIONS $52,000 $54,000 $56,000
    Additional Cash Spent
    Sales Tax, VAT, HST/GST Paid Out $0 $0 $0
    Principal Repayment of Current Borrowing $0 $0 $0
    Other Liabilities Principal Repayment $0 $0 $0
    Long-term Liabilities Principal Repayment $0 $0 $0
    Purchase Other Current Assets $0 $0 $0
    Purchase Long-term Assets $0 $0 $0
    Dividends $0 $0 $0
    SUBTOTAL CASH SPENT $52,000 $56,160 $60,653
    Net Cash Flow $15,500 $16,900 $18,000
    Cash Balance $22,000 $23,000 $24,000

    8.5 Projected Balance Sheet

     Pro Forma Balance Sheet      
    Assets Year 1 Year 2 Year 3
    Current Assets
    Cash $268,000 $300,160 $330,176
    Accounts Receivable $23,000 $25,760 $28,954
    Inventory $4,000 $4,480 $4,900
    Other Current Assets $1,000 $1,000 $1,000
    TOTAL CURRENT ASSETS $277,000 $310,240 $348,710
    Long-term Assets
    Long-term Assets $10,000 $10,000 $10,000
    Accumulated Depreciation $18,100 $20,272 $22,806
    TOTAL LONG-TERM ASSETS $24,000 $26,880 $30,240
    TOTAL ASSETS $291,000 $325,920 $366,660
    Liabilities and Capital Year 4 Year 5 Year 6
    Current Liabilities
    Accounts Payable $18,800 $21,056 $23,667
    Current Borrowing $0 $0 $0
    Other Current Liabilities $0 $0 $0
    SUBTOTAL CURRENT LIABILITIES $15,500 $17,360 $19,513
    Long-term Liabilities $0 $0 $0
    TOTAL LIABILITIES $13,400 $15,008 $16,869
    Paid-in Capital $29,000 $30,200 $30,900
    Retained Earnings $53,300 $58,097 $63,907
    Earnings $192,500 $209,825 $230,808
    TOTAL CAPITAL $277,800 $302,802 $333,082
    TOTAL LIABILITIES AND CAPITAL $291,200 $325,920 $366,660
    Net Worth $285,000 $310,650 $341,715

    8.6 Business Ratios

     Ratio Analysis        
    Year 1 Year 2 Year 3 INDUSTRY PROFILE
    Sales Growth 7.25% 8.03% 8.90% 3.00%
    Percent of Total Assets
    Accounts Receivable 9.28% 10.28% 11.39% 9.80%
    Inventory 5.40% 5.98% 6.63% 9.90%
    Other Current Assets 2.15% 2.38% 2.64% 2.40%
    Total Current Assets 150.02% 151.00% 152.00% 158.00%
    Long-term Assets 11.39% 11.45% 11.53% 12.00%
    TOTAL ASSETS 100.00% 100.00% 100.00% 100.00%
    Current Liabilities 4.89% 4.93% 4.97% 4.34%
    Long-term Liabilities 0.00% 0.00% 0.00% 0.00%
    Total Liabilities 7.61% 7.67% 7.74% 7.38%
    NET WORTH 101.02% 101.83% 102.76% 110.00%
    Percent of Sales
    Sales 100.00% 100.00% 100.00% 100.00%
    Gross Margin 95.03% 97.60% 100.33% 99.00%
    Selling, General & Administrative Expenses 94.90% 97.46% 100.19% 97.80%
    Advertising Expenses 1.54% 1.58% 1.63% 1.40%
    Profit Before Interest and Taxes 41.10% 42.21% 43.39% 33.90%
    Main Ratios
    Current 34 35 36 32
    Quick 34 34.5 35.3625 33
    Total Debt to Total Assets 0.17% 0.17% 0.17% 0.40%
    Pre-tax Return on Net Worth 73.80% 74.60% 75.12% 75.00%
    Pre-tax Return on Assets 95.02% 99.77% 104.76% 111.30%
    Additional Ratios Year 1 Year 2 Year 3
    Net Profit Margin 33.21% 34.24% 35.30% N.A.
    Return on Equity 55.10% 56.81% 58.57% N.A.
    Activity Ratios
    Accounts Receivable Turnover 7.7 7.8 7.8 N.A.
    Collection Days 100 100 100 N.A.
    Inventory Turnover 32 33.6 34 N.A.
    Accounts Payable Turnover 15.3 15.8 16.4 N.A.
    Payment Days 27 27 27 N.A.
    Total Asset Turnover 2.4 2.5 2.6 N.A.
    Debt Ratios
    Debt to Net Worth -0.04 -0.03 -0.04 N.A.
    Current Liab. to Liab. 1 1 1 N.A.
    Liquidity Ratios
    Net Working Capital $238,900 $252,278 $266,406 N.A.
    Interest Coverage 0 0 0 N.A.
    Additional Ratios
    Assets to Sales 0.86 0.87 0.88 N.A.
    Current Debt/Total Assets 1% 1% 0% N.A.
    Acid Test 29.45 29.89 30.01 N.A.
    Sales/Net Worth 2.2 2.2 2.3 N.A.
    Dividend Payout 0 0 0 N.A.

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