How to build your plan’s financials without guessing

The steps

1. List every one-time startup cost and every fixed monthly cost, using the categories in the template.
2. Replace each estimate with a written quote or a published fee wherever you can, and note the source.
3. Run the startup cost and cash-flow reserve calculators on homecarestartupcost.com and carry the totals into your plan.
4. Enter your hourly rate and cost per hour of care to see the break-even hours your numbers imply.
5. Write down the assumption behind every number, and have an accountant prepare or check the projections you attach.

Why we do not give you numbers

Startup costs, rates and wages differ by state, city and the choices you make, and sample numbers tend to get copied into real plans. A lender will ask where each figure came from. A number you cannot source weakens the whole plan, so the template starts every amount blank.

Use the calculators for the cash math

The plan and the calculators do different jobs. The startup cost calculator helps you total one-time and early costs, and the cash-flow reserve calculator helps you size the reserve you hold until revenue covers costs. Both are on homecarestartupcost.com, also published by Home Care Agency Blueprint. Carry their totals into the plan’s financial section, and keep the printouts for your appendix.

What the SBA says the financial section should include

The SBA advises supplementing a funding request with financial projections: forecasted income statements, balance sheets, cash flow statements and capital expenditure budgets, with quarterly or even monthly detail for the first year, and projections that match your funding request. It suggests organizing startup costs into one-time and monthly expenses so you can see how much capital you need and when.

The SBA’s list of common startup costs includes office space, equipment and supplies, communications, utilities, licenses and permits, insurance, lawyer and accountant, employee salaries, advertising and marketing, market research, printed marketing materials and a website. The template’s financial categories follow that list.

Break-even, in plain terms

The SBA calls the break-even analysis an important part of a business plan presented to an investor. Its formula is fixed costs divided by the price per unit minus the variable cost per unit. For a home care agency the unit is usually one billed hour of care: your monthly fixed costs divided by your hourly rate minus what each hour costs you in caregiver pay, payroll taxes and other per-visit costs. If your hourly rate is not above your cost per hour, there is no break-even point at that rate.

Get help with the projections

Have an accountant prepare or check the projections you attach. The SBA’s resource partners, including Small Business Development Centers and SCORE mentors, offer counseling; find them through the SBA’s local assistance page.