Starting an ABA company may seem overwhelming. You may find yourself asking questions about what to do, when to do it, how to do it, and who to go to for what. While some tasks can be done in different orders, I will outline here some critical considerations for starting a successful ABA agency.
First
Know what you’re getting into. There are many responsibilities and tasks you’ll need to take on as a new ABA business owner from selecting a name, to writing a business plan, to contracting with insurance companies. At the end of this article we include a link to a free project planning tool you may find helpful. For someone doing this for the first time, it could easily involve several hundred hours to get up and running. Still interested? Great! Move on to the next step.
Second
The next thing you need to do is figure out where (which state/region) you want to open up shop, at least initially. This will determine things like regulations, licensure requirements, rates, expenses, etc, all of which are important parts of the strategic financial and business planning process. There are different reasons for selecting locations. You may simply want to provide services in the area where you currently live. Alternatively, you may look at this from a slightly more strategic perspective and ask what are the publicly available rates in those areas and what is the state of licensure and regulations in the select states. Both are reasonable approaches.
Third
Determine the general model you envision. That will drive a lot of the business and financial planning. Do you want a clinic, multiple clinics, do you want to scale slowly or quickly. What services do you plan to deliver? What infrastructure do you want to have? Do you want BCBAS, BTs, a clinical director, a scheduling coordinator…. Who else, and at which point in the process? Are there other expenses you want to take on which are not necessary for operations, but have value nonetheless, like a researcher? These among other questions are important to consider in planning for your ABA company. Your PBH consultants have collectively worked at small, medium, and large providers and can help you adequately plan for this structure over the course of the agency’s growth.
Fourth
Do your strategic financial planning. This minimally includes projected profit and loss and projected cash flow statement, and potentially even your opening and projected balance sheet and your start-up expenses. Properly planning in this regard will help you identify precisely how much money you need for your start up ABA company.
To start, prepare a projected profit and loss (how much you’re making on paper when you subtract expenses from revenue) and cash flow statement (cash in and out) for 5 or so years in the future depending on yours or your bank’s needs. The profit and loss projections would look at a revenue build for that period of time, as well as expenses during that same time period, and project profit. The projected cash flow statements would look at cash in and out for each period of time. So, it allows you to see how much cash you’ll have to pay bills, reinvest, etc, after considering things like time to payment from funding sources, new funding sources in particular, time to credentialing, time from hiring new staff to when you’ll be paid for their services, etc. The strategic financial planning also considers other factors like taking on a new location, training, and turnover for example. You can purchase a template for this here: https://partnersaba.com/product-and-service-packages/five-year-financial-projections-template
PBH can help you with your strategic financial planning needs to help ensure adequate funds and a viable plan for your startup or growth period, as well as ongoing analyses and planning thereafter.
Fifth
Determine the feasibility of your plan. Do you generate sufficient profits? Do you have adequate cash flow, that is, the cash to pay for your bills on an ongoing basis? Consider doing a pro con list. Is the work and perhaps of greater importance the responsibility which may ultimately come back to you worth the pay? If the feasibility analysis is favorable, you will want to move on to the business planing phase. You can access a template for that here: https://partnersaba.com/product-and-service-packages/business-plan-template-semi-complete-will-be-priced-at-299-and-availble-for-download-in-april
Conclusion
By now you should know whether your plan is a viable one. Your next step is preparing a business plan to secure the funding, or at least prepare your business for success.
Interested in learning more? You can see our free project planning tool here: https://partnersaba.com/product-and-service-packages/project-planning-worksheet-for-an-aba-company.
For more blogs from our series on critical considerations for starting a successful ABA company and strategic financial planning for ABA companies, or to learn more about how PBH can help with these or other ABA business, executive coaching, or OBM needs, please email us at info@partnersaba.com, or check us out at www.partnersaba.com where you can sign up at the bottom of the page for further blogs and emails. You can also like us on Facebook and Linkedin to follow our posts.
.About the author
To learn more about the author, Brandon Herscovitch, PhD, BCBA-D, LABA, click on this link.
