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Your Acupuncture Business Plan
Your acupuncture classes in practice management should provide you with books, lectures, and handouts on what a business plan is. However, it is unlikely that you will receive any instruction on how to write a business plan. Don't let that stop you from mapping out the development and growth of your acupuncture practice. Maybe the acupuncture profession would experience greater success and demonstrate better practice statistics if we devoted more time to planning out effective business strategies. Although it is likely that you will not need a formally written business plan, I encourage you to go through the step-by-step process of thinking one through.
It can't hurt. And it can definitely help. Plus I will share a few of my favorite FREE and FUN resources to help you along the way.
What You Need to Know About
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The purpose of any business plan is to provide a well thought-out map for your success. It is organized in a particular manner so that you can easily communicate your specific strategies to a bank, the Small Business Administration, or any other lending institution (even Mom & Dad). |
Business Plan Basics:
Acupuncture is a "service-based" business as opposed to a retail or wholesale based business. You are providing a service as a health care provider. And even though you may also sell herbs and other retail products, your primary source of income is from services rendered.
1. A formally written business plan is required if you plan to borrow money to start or expand your acupuncture business.
If you are investigating securing grants for business development or a loan from a bank, writing a professional business plan is a must.
If you do not need to take out a business loan or apply for a grant, then technically you do not need a formally written business plan. But you should write (at least an informal) one anyway. Keep reading.
2. A business plan forces you to define your business.
This includes your mission, philosophy, and goals. Unlike other businesses, as an acupuncturist, YOU ARE YOUR BUSINESS.
Although you are "selling" acupuncture as a service, what makes your business unique is YOU. Any basic book on business will tell you that in order to be successful, you must know your product. What this means is, you must know yourself.
You must be able to communicate to your "customers" why YOU are the best acupuncturist for them. If all you do is try to "sell" acupuncture (and other Chinese Medicine techniques) as the service you provide, you are missing out on the biggest part of your practice. YOU!
Assessing your strengths and weaknesses, knowing your inner motivations, and understanding your fears and goals will make you a better practitioner and a more successful business owner.
3. Your patients are your customers.
A business plan helps you identify your "target" customer. Who is the most likely person to seek out and use acupuncture? What is their gender, age, education level, or income? Answering these questions helps you to:
- Know where to find your customers.
- Know how to communicate with and advertise to them.
- Know how to expand your customer base.
- Know what fees are appropriate to charge for your services.
The fancy word for all of this information is "customer demographics". In order to be successful, you must be sure there is a significant population of likely customers where you set up your acupuncture practice, and they can access you easily (by foot, bicycle, car, or bus).
4. Your business plan should detail your marketing strategies.
Now that you know your customer demographics and you have a large population of likely people to walk through your door, how exactly will you let them know you exist?
| Having strategies and methods to educate and reach out to your most likely customers is very important. Know what methods resonate with who you are. For instance, don't schedule talks at local health food stores or senior centers if you are terrified of public speaking and don't have any experience.(Of course you can always join a local Toast Masters club and learn these skills.) |
On the other hand, if you are a dynamic speaker and enjoy talking to groups about Chinese Medicine, go for it!
Other forms of marketing materials suitable for most anyone include a Yellow Pages listing, business cards, acupuncture brochures, and newsletters.
One of the most underutilized sources of marketing (and income!) by acupuncturists is having a website. I strongly believe that a well-researched and optimized website for your acupuncture practice can not only provide 99% of your marketing needs, but also generate new avenues of revenue.
I am so certain that this is a powerful area that acupuncturists are missing out on that I devoted an entire section, with website resources and cost analysis, to help acupuncturists get up to speed. (See, The Web-site That Has A Very Busy Weaver, by Lisa Hanfileti, LAc, MAcOM, ©Copyright 2007.)
5. A business plan lists all your business "needs".
This refers to employees, advertising materials, herbal products, and equipment, like treatment tables, acupuncture needles, herbal dispensary materials, chairs, pictures for the walls, signage, computers, clip boards, paper, pens and anything else that is necessary for you to run your business.
Knowing your specific business needs is important to help you with the next, and probably the most difficult, part of your entire business plan; The Budget.
If you are planning on applying for a business loan then you must have a well planned and articulated budget.
6. A budget is a projected estimate of the costs it will take for you to start your business and operate until it reaches the "break even point".
You must buy the necessary equipment to get your business set up. It is relatively easy to come up with cost estimates for hard goods like computers and treatment tables. You should end up with an accurate number for these fixed costs.
There will always be unforeseen items that arise, but for the most part you will be able to come up with a realistic budget for everything you need.
| In simplistic terms, the "break even point" is an estimated point in time (a month and year) when your projected income will equal your expenses. It seems like a straight forward math equation. But what many new business owners forget to factor into that equation are the financial estimates for your LIVING expenses while your business steadily grows. |
Your budget needs to take into account the fact that your business "income" will need to go to business expenses initially.
Therefore, you either need a significant savings or a business loan to make certain you can pay for living essentials like food, your rent or mortgage, insurances, car payments, school loans, credit card bills, utilities, gasoline, and all the other expenses that don't have anything to do with the business directly.
This is where understanding the meaning of Pay Yourself First is very important. ("Pay Yourself First" and other financial strategies will be covered in more depth in Financial Management.)
Overall, a Business Plan serves to map out a short term set of strategies for your business success. Although you will include contingencies to take into account variations in start-up costs, market demand, and other factors, you cannot plan for everything.
I had been in practice a little over a year and was just starting to feel like a successful business owner gaining momentum when September 11th happened. It affected the economy everywhere.
So plan for what you can. Take the rest as it comes. And be happy you get to be part of the coolest profession on earth.
FREE Business Plan Writing Resources
Writing your business plan does not have to be costly or boring.There are many FREE Business Plan Writing Resources available to you help you through this important planning process.
These include free online courses, tutorials, and downloads from a variety of private, government and local sources. My favorites are: "My Own Business, Inc.", the Small Business Administration, and the United States Internal Revenue Service.
You can also use business plan writing software to help you through the specific steps and produce a professional report.
Another FUN option is to "write" a business plan by mapping it out using a non-linear format called a Mind Map. If you have never tried this, look at my Acupuncture Clinic's Marketing Plan using a FREE Mind Map I downloaded from the internet. Try it yourself. It's FUN!
If it is FREE expert information about Business Plans and business strategies then read anything that Tim Berry has to say.
He is the author of Business Plan Pro and the president of Palo Alto Software (located in Eugene, Oregon). His hippie roots, curiosity, writing talents, and incredible brilliance has made him a legend in the business community.
Free Business Plan Resources
Use a Mind Map to "Write" Your Business Plan
Business Management Basics
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