Starting a therapy practice can be incredibly rewarding, but it also comes with its challenges.
Beyond clinical expertise, you need a solid business plan to succeed. Picture your business plan as a practical road map, designed to support your journey through the uncertain and unpredictable world of business ownership.
Taking the time to do it now will help you create the practice you want now, rather than compromising and having to pivot later.
When the challenges of entrepreneurship seem overwhelming (and they will), this plan stands as your reliable guide, helping you make decisions aligned with what you want for your business.
Embrace the CEO role
I hate to be the one to tell you this, but nothing you read in the remainder of this article matters if you don't accept this hard truth: Being a clinician is no longer your main job.
You are the CEO of your therapy practice. You are also sales, HR, IT, marketing, admin, manager, and yes, CFO.
Accept that being a clinician and running a profitable therapy practice are two very different things that require two very different skill sets. Write your vision down. Get clear on your values. Step into your CEO role.
Define your personal goals
Start with your personal goals. They drive your business aspirations. Maybe you want to only work three days a week so you have time to spend with your family. Living abroad and having the flexibility to see clients from anywhere in the world may appeal to you. Getting clear on what you value and your personal goals helps you to structure a business that best serves you.
Consider factors like:
- Family commitments
- Community involvement
By aligning your business with your personal aspirations, you create a practice that truly suits you. This alignment between your personal and business aspirations isn't just beneficial—it's a pivotal factor for achieving a fulfilling practice that doesn't feel like the agency job you left.
Create your business goals
Answer fundamental questions such as:
You may aspire to have a waitlist of dream clients, hire staff, or hit $20K months. Whatever you desire can be achieved by answering these foundational business questions.
Manage your cash flow
Ensure financial stability with a clear cash flow plan, consisting of two parts.
Projections: Predicting income and expenses
Begin with projections, estimating when money comes in and goes out based on past financial data. It's like foreseeing your financial path, and here's where using the financial reports provided by Heard becomes especially meaningful. These reports serve as your compass, guiding you through the intricate landscape of your practice's finances.
System: Implementing your plan
With projections in hand, it's time to execute. Decide how much you'll allocate to different areas, like expenses, payroll, taxes, savings, and your earnings. Keep track of these allocations and adjust as needed. This structured approach transforms your projections into actionable financial decisions, making sure your practice thrives. Businesses don't go out of business due to lack of profit, they go out of business due to lack of cash. By monitoring and reviewing your cash, you set your business up to not run out of money.
Maximizing your profit
Maximizing your profit is about adopting strategies to increase your earnings. This could mean enhancing your services, adjusting fees effectively, and streamlining operations for better efficiency. You should also focus on key profit drivers like your sales conversion rate and the number of potential clients who engage with your services. To maximize profit, it's essential to understand the nuances of sales and marketing, as they drive revenue growth. Additionally, keep an eye on your expenses to make sure you're not outspending what you're earning. This balanced approach ensures your practice remains financially healthy.
Stay on track
After crafting your business plan, regularly review and adapt. Keep a close watch on your progress. Ensure your income aligns with your needs, and make tweaks along the way.
If a marketing strategy falls short, switch it up and pivot. Closing new clients left and right and now you have a full caseload of dream clients, amazing! Your business plan will change as you grow and become more successful. It's important to review your progress, celebrate your wins, and adjust the plan along the way.
A simple and executable business plan is the foundation of a thriving mental health practice. As you embrace your CEO role, set personal and business goals, manage cash flow, and maximize profit, you pave the way for success. Regular monitoring and adjustment keep you on track as this is a continuous process you will redefine many times.
With this actionable plan, you're equipped to impact your clients and live the life you desire.
Want to learn more? Ashley Harlan, MBA will be presenting a free virtual workshop, “How to Build a Business Plan for Your Therapy Practice,'' on Wednesday, September 20 at 12 PM PST. Click here to register.
This post is to be used for informational purposes only and does not constitute legal, business, or tax advice. Each person should consult their own attorney, business advisor, or tax advisor with respect to matters referenced in this post.
Ashley Harlan, MBA is a Chief Financial Officer, Founder, and CEO of The Concierge CFO. She’s passionate about partnering with mental health and wellness professionals to help you reach your mission through financial freedom. Her focus is on guiding you to earn what you deserve, achieve your goals, and not burn out. If you're ready to build a practice you enjoy, serve the clients you feel called to, and not have to sacrifice your lifestyle, join her Profitable Practice Accelerator—a 6-week program that enhances your financial stability and gives you the freedom to live the life you want. Ashley can be found on Instagram, Twitter, and LinkedIn.