Over the next few months, we are going to dig into the details of the business plan elements outlined in our recent article 8 Crucial Content Areas for your PT Business Plan. In that article, we suggested that for your first new clinic, you might secure start-up funding from friends and relatives in addition to your savings. However, for simplification of the language in this article, we will assume that you are securing at least some funding from an outside source, such as the Small Business Administration (SBA). Yet, the recommendations here apply to every physical therapy clinic business plan.
Who Should Create a Business Plan
We always recommend you go through the Business Plan “exercise” even if you do not have to approach third parties for funds. But if you do request SBA funds, you will need to flesh out those eight content areas with some additional subject matter and clarification.
To reiterate what we stated earlier, the Small Business Administration states,
“The development of a comprehensive business plan shows whether a business has the potential to make a profit.”
By putting statistics, facts, figures and detailed plans in writing, a new business has a better chance of attracting funding. To that end, professional funders such as bank/SBA loans will typically look for an Executive Summary as your Plan’s overview.
The Purpose of the Executive Summary
Some lenders may not bother reviewing your Plan if you haven’t made a compelling and persuasive argument up front for why they should consider loaning you funds.
Although the Executive Summary is placed at the beginning of your Business Plan, it should be written last. It is an overview of the entire plan. Most banks and investors will read it first or use it when considering future funding so ensure that you have the most important points of the plan written well. As we will explain below, include rationale for the needed financing and how it will be used, the growth you will expect as well as the services that you provide and staffing required. Remember, this plan needs to be written for someone who may not be familiar with the details for your business. Be clear and comprehensive, but also keep it brief so the reader is not bored.
Executive Summary Sections
Your Executive Summary should be around two pages, and contain the following sections.
The Point of It All
Begin your physical therapy clinic Executive Summary with:
A description of your company
The services you will provide
Your Mission Statement or “purpose” for starting the business
An explanation of your concept, and opportunity your business presents to the investor/lender and to the marketplace itself
Details of the overall rehabilitation market (size and forecast growth rates), and the local rehab market in which you will compete
Background and Management
Be sure to describe any relevant information on your clinic’s background and management. Provide context pertaining to your clinic’s launch, and the management of your staff and business after operations begin.
Finally, you need to explain your business’ financials and the funds you seek. In the Executive Summary, the Financials should be a three- or five-year forecast for Revenues and Earnings that you anticipate. (Your Financial Forecast is supported in detail later in your Business Plan.) The funds you seek from a lender or investor should be supported not only by this forecast, but explained as to why you need the funds you are requesting. For example, do you need these funds for Working Capital during the start-up phase of your business? Will you use the funds for Marketing efforts? PT Equipment? Etc.
In conclusion, the Executive Summary represents perhaps the most important element of your physical therapy clinic business plan. The ideas and support you provide in the Summary will make or break the reader’s interest. Excite her/him to read you entire Business Plan!
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