assisted living facility SWOT – ALF Business Plan

1.0 Executive Summary

The purpose of this business plan is to raise $900,000 for the development of an assisted living facility while showcasing the expected financials and operations over the next three years. The Assisted Living Facility, Inc. (“the Company”) is a New York based corporation that will provide assisted living services through its facility to customers in its targeted market. The Company was founded by John Doe.

1.1 The Services

As state above, the Assisted Living Facility is in the business of providing compassionate assisted living services that will allow developmentally disabled people to live happy and productive lives while having direct access to assistance. The facility that the business is seeking to acquire can house up to 20 people. It is anticipated that the business will receive $2,500 per month per resident.

In addition to these fees, the Company will also provide a limited number of medical services when necessary (provided by third party independent contractors that are properly licensed). This will be a strong secondary stream of income for the business.

The third section of the business plan will further describe the services offered by the Assisted Living Facility.

1.2 Financing

Mr. Doe is seeking to raise $900,000 via a bank loan. The interest rate and loan agreement are to be further discussed during negotiation. This business plan assumes that the business will receive a 30 year loan with a 5.25% fixed interest rate. The financing will be used for the following:

Development of the Company’s Assisted Living Facility location.
Financing for the first six months of operation.
Capital to purchase FF&E for the facility.
Capital for licensure and professional fees associated with the establishment of the assisted living facility location.

Mr. Doe will contribute $100,000 to the venture.

1.3 Mission Statement

It is the goal of the Company to provide a caring environment for those that need assisted living support support. The Company is committed to providing a safe and secure environment for its residents. Management will also ensure that the facility complies with all local, state, and federal regulations concerning assisted living services.

1.4 Management Team

The Company was founded by John Doe. Mr. Doe has years of experience in the assisted living facility industry. Through his expertise, he will be able to bring the operations of the business to profitability within its first year of operations.

1.6 Expansion Plan

The Founder expects that the business will aggressively expand during the first three years of operation. Mr. Doe intends to implement marketing campaigns that will effectively target families with individuals that require continued care within a compassionate assisted living facility.

2.0 Company and Financing Summary

2.1 Registered Name and Corporate Structure

Assisted Living Facility, Inc. The Company is registered as a corporation in the State of New York.

2.2 Required Funds

At this time, the Assisted Living Facility requires $900,000 of debt funds. Below is a breakdown of how these funds will be used:

2.3 Investor Equity

Mr. Doe is not seeking an investment from a third party at this time.

2.4 Management Equity

John Doe owns 100% of the Assisted Living Facility, Inc.

2.5 Exit Strategy

If the business is very successful, Mr. Doe may seek to sell the business to a third party for a significant earnings multiple. Most likely, the Company will hire a qualified business broker to sell the business on behalf of the Assisted Living Facility. Based on historical numbers, the business could fetch a sales premium of up to six times earnings plus the value of the appreciated real estate owned by the Assisted Living Facility.

3.0 Assisted Living Facility Services

The Assisted Living Facility’s will seek to provide people with an alternative to the uncompassionate facilities of normal mental health institutions. The Company will hire a broad range of assisted living aides that will provide a safe, stimulating, and caring environment for the Company’s residents. As stated in the executive summary, the business will be able to house up to 20 people at any given time. By the start of Year 2 of operations, the Company anticipates that the location will operate at 95% occupancy at all times.

In order to ensure that residents have access to their healthcare needs onsite, the business will retain a number of licensed medical professionals that can render services. These professionals include:

Mental Healthcare Providers (including social workers, therapists, and psychologists)
Occupational Therapists
Physical Therapists

Beyond these professionals, the Company will retain a physician consultant (who will be on twenty-four hour call) in order to recommend courses of action in the event of a medical emergency. It should be noted that the Company, at all times, will comply with all federal, state, and local laws regarding the operations of the facility. All employees will be required to undergo substantial background checks prior to their employment.

4.0 Strategic and Market Analysis

4.1 Economic Outlook

This section of the analysis will detail the economic climate, the assisted living facility industry, the customer profile, and the competition that the business will face as it progresses through its business operations.

Currently, the economic climate is uncertain. The pandemic stemming from Covid-19 has created a substantial amount of turmoil within the capital markets. It is expected that a prolonged economic recession will occur given that numerous businesses are being forced to remain closed for an indefinite period of time (while concurrently having their respective employees remain at home). However, central banks around the world have taken aggressive steps in order to ensure the free flow of capital into financial institutions. This is expected to greatly blunt the economic issues that will arise from this public health matter.

However, assisted living facilities typically operate with great economic stability as people will continue to require specialized medical care regardless of the general economic climate. Additionally, the risks related to developing a new assisted living facility are further ameliorated given that two vaccines have been approved and many older people will soon be immunized.

4.2 Industry Analysis

There are over 60,000 assisted living service companies in the United States. Each year, the industry generates over $76 billion dollars in billable revenue. The industry also employs more than 1,000,000 people.

The assisted living industry has grown substantially over the past twenty years as people are living longer and require a greater degree of care. Additionally, many families have become busier. Most families are now two-income households and the difficulty between managing a professional life and family life has increased significantly. As such, many families feel that assisted living facilities are the only option when an older person (or developmentally disabled person) requires ongoing supervision and care.

This is a mature industry, and the future anticipated growth rate of the industry will mirror that of the general economy and the population growth among people aged 65 and older.

4.3 Customer Profile

Mr. Doe expects that residents will have a range of older age disorders, but are able to live within a facility that provides a host of specialty physical and mental health care services. Management anticipates that the average client will be between the ages of 70 to 80.

In this section of the analysis, you should describe the type of customer you are seeking to acquire. These traits include income size, type of business/occupation; how far away from your business is to your customer, and what the customer is looking for. In this section, you can also put demographic information about your target market including population size, income demographics, level of education, etc.

4.4 Competition

This is one of the sections of the business plan that you must write completely on your own. The key to writing a strong competitive analysis is that you do your research on the local competition. Find out who your competitors are by searching online directories and searching in your local Yellow Pages. If there are a number of competitors in the same industry (meaning that it is not feasible to describe each one) then showcase the number of businesses that compete with you, and why your business will provide your residents with higher quality assisted living care.

5.0 Marketing Plan

The Assisted Living Facility intends to maintain an extensive marketing campaign that will ensure maximum visibility for the business in its targeted market. Below is an overview of the marketing strategies and objectives of the Company.

5.1 Marketing Objectives

Implement a local campaign with the Company’s targeted market via the use of local newspaper advertisements and word of mouth advertising.
Establish relationships with doctors and mental health professionals that will refer business to the Assisted Living Facility.
Develop ongoing relationships with healthcare organizations in the target market.

5.2 Revenue Forecasts

Assisted Living Facility Revenue Forecasts

5.3 Assisted Living Facility Marketing Strategies

Foremost, the Assisted Living Facility will maintain strong relationships with the healthcare community. This will ensure that proper referrals are made when an older person (or developmentally disabled person) requires round-the-clock care that cannot generally be provided by their family. The business, during the course of the pre-launch phase of the business, will distribute information packages to social workers, psychologists, other mental healthcare professionals, and well as physicians that specialize in geriatric medicine. This will ensure that a waiting list can be developed while the facility is being prepared.

The Company will also maintain an expansive presence on the Internet via a proprietary website as well as a social media presence. As it relates to the website, the Company will have a large scale platform developed that is mobile friendly and search engine optimized. This website will showcase the facility, amenities, and how to enroll a loved one as a resident. This platform will also feature account login functionality in order to track the expenses of residents. The website will link to all social media accounts.

The business will use search engine optimization strategies in order to increase the presence of the website when specific keyword searches are completed. For instance, when a person conducts as search for “assisted living facilities in New York”, the Company’s website will appear within the search. The retained SEO firm will place linking text on a third party websites in order to accomplish this goal. This firm will also manage press releases issued by the business.

In regards to the social media marketing aspect of operations, the Assisted Living Facility will maintain pages/accounts on Facebook, Twitter, Instagram, and YouTube. These social media pages generally allow for reviews to be provided, which will create a strong brand name for the Company moving forward. In regards to YouTube, the business will have a number of professionally produced videos created that will showcase the facility and senior staff. These videos will be uploaded to YouTube and mirrored on both the Company’s proprietary website and social media pages.

The business will also develop ongoing relationships with regional real estate brokers and agents that will provide referrals to people that have recently moved to the area. Brochures and information packages will be mailed to these individuals in order to make them aware of the Assisted Living Facility brand name.

Management will also become a member of a number of professional and civic organizations. The business will provide donations and financial support to local charities and positive community causes. This will create additional awareness especially among organizations that provide services to elderly people. These donations will be made on an ongoing basis. Finally, the Company will advertise in local and regional publications (magazines, journals, and real estate circulars). This is important for two reasons. First, it will further create visibility of the Company on a regional basis. Second, many of these advertisements will also be shown on the online versions of these publications (which will have a direct link to the Company’s website). This will further assist in the search engine optimization strategies that the business will use in order to drive traffic to the

6.0 Organizational Summary

6.1 Corporate Organization

Assisted Living Facility Personnel Summary

6.1 Organizational Budget

Assisted Living Facility Personnel Costs

7.0 Financial Plan

7.1 Underlying Assumptions

The Company has based its proforma financial statements on the following:

The Assisted Living Facility will have an annual revenue growth rate of 8% per year.
The Owner will acquire $900,000 of debt funds to develop the business.
The loan will have a 30 year term with a 5.25% interest rate.

7.2 Sensitivity Analysis

The Company’s revenues are not sensitive to negative changes in the economy. The demand for quality assisted living facilities remains strong in any economic climate. Despite the pandemic (which is expected to subside within 2021), families will still require ongoing care. The high gross margins generated from monthly fees as well as rendered services will ensure that the business is able to remain profitable and cash flow positive at all times.

7.3 Source of Funds