Business Plan in the Clinic - Term Paper Example

Executive summary

Alicia nurse practitioner clinic is a locally owned clinic whose main goal will be to provide satisfactory health care for all patients at the lowest prices. We will ensure that we offer the medical care through a careful maintenance of efficiency in our operations. Alicia nurse practitioner clinic will be owned and managed by Dr. Franklin. He will be responsible for ensuring the general health and medical practice. Throughout the first year, Dr. Franklin will work closely with the advisors of the Alicia nurse practitioner to get the clinic into a financial and operational footing.

Alicia nurse practitioner clinic will operate e from one center which will offer its services for 24 hours. This center will look forward to employing friendly and knowledgeable personnel which will drive the repeat business that we will rely upon. The Alicia nurse practitioner clinic will be more appealing to the patients’ sense of value and convenience. We will carry on our advertisements, mainly through magazines targeted at over-50 crowd as it is effective method according to Siegel (2010). The core reason will be targeting at those who are looking forward to good services and regular expenses. Profitability of the clinic will be expected in the second year and will generate substantial services by the third year.

• • objectives

We have the following objectives for our first three years

• To ensure superior services to exceed the customer expectation.
• To ensure there is increase by more than 30% of the number of customers every fiscal year.
• To ensure there is a balanced cash flow of the business activites
  • Mission

The Alicia nurse practitioner clinic mission is to provide our patients with the best services as well as ensuring our convenience and services that exceed the expectations of our patients.

• • Keys to success

For the Alicia nurse practitioner clinic to succeed, then our keys of success will be:

• To ensure the satisfaction of our customers so they will return again and again.
• To ensure the maintenance of low overhead and operating costs.
• To out win all the other competitors by ensuring better pricing of our services.

Summary of the clinic

The Alicia nurse practitioner clinic is located in Alicia town along North Sprig road opposite the Alicia Stadium and offers health care services at relatively affordable costs.

2.1Company ownership

The Alicia nurse practitioner clinic is an Agha khan liability corporation. The majority stakeholder is Dr. John Franklin.

2.2 start up summary

The clinic will incur the following start-up equipment expenses:

• Front counters, storage bins, cash register.
• Office equipment including chairs, file cabinets and desks.
• Five computer terminals.
• Five patient beds.
• Central computer server with a laser printer and a backup system.
• Computer software: Microsoft office, quick books pro, drug interaction software, physician desk reference software detailing side effects and other information pertinent to the patients.
• Assorted bottles, boxes, envelopes for the purposes of dispensing and shipment.
• Telecom system
• Storefronts build out.
• Start-up inventory.
• Rent utilizes.

The above-mentioned items are to be used for more than one year hence long-term assets prone to depreciation by use of G.A.A.P. with approved straight line method of depreciation.

Start-up requirements

Start-up expenses

Legal $200000

Rent $300000

Utilities $100000

Telecom system $500000

Insurance $100000

Clinic front build-out $2000000

Expensed equipment $1000000

Website development $150000

TOTAL START UP= $42150000

Start-up assets

Cash required $18000000

Start-up inventory $2000000

Other current assets $ 0

Long-term assets $ 1000000

TOTAL ASSETS $21000000

Total requirements $25250000

START UP FUNDING

Start up expenses to fund $4250000

Start-up assets to fund $21000000

TOTAL FUNDING REQUIRED $25250000

Assets

Non-cash assets from the start-up $ 4250000

Cash requirements from the start-up $ 1800000

Additional cash raised $ 0

Cash balance on starting date $ 1800000

TOTAL ASSETS $785000

Liabilities and capital liabilities

Current borrowing $ 0

Long-term liabilities $ 0

Account payable (outstanding bills) $ 0

Other current liabilities (interest-free) $ 0

TOTAL LIABILITIES $ 0

Capital

Planned investment

Fellow funding $ 10000000

Dr. Franklin $ 5000000

Friends and family $5000000

Additional investment required $ 4000000

TOTAL PLANNED INVESTMENT $ 21000000

Loss at startup(startup expenses) $ 4250000

TOTAL CAPITAL $ 21000000

TOTAL CAPITAL AND LIABILITIES $ 21000000

Total funding $ 25250000

Services

The Alicia nurse practitioner clinic offers a wide range of services to the patient’s base in locality or country. It offers healthcare services and pharmacy services. The Alicia nurse practitioner clinic will give services to customers with self-pays. The clinic will give discounts to young children below five years and old people above 65 years. The clinic will be using computer printouts from the Agha Khan University hospital softwares. The clinic will also provide the following services:

• Gynecology- this will include PAP tests, annual well woman exams, family planning and acute gene problems.
• Pediatrics- this will include newborns care, infant care, annual physicals, routine services and possible immunizations.
• Dermatology- this will include the removal of minor lesions, skin tags, moles, and warts, biopsies of suspicious dermatology lesions, allergy testing, and shots, tetanus, Pneumovax, and immunizations.
• Adult medicines- this will include preventive and routine services, diabetic teaching, nutritional services, exercise and obesity counseling and cardiology (EKGs and possible stress testing)

Accessibility

The Alicia nurse practitioner will adopt several strategies to ensure patient satisfaction and word of mouth advertising. First four hours will include after-hours care to allow patients to attend the clinic after they return from work. We will also offer our services during weekends.

Service analysis summary

According to PBPC (2015), the health care setting should favor both the inpatient and outpatient. Hence, the clinic market will consist of two different groups, the local day patients and those admitted until their recovery. The company will employ two different strategies to reach these diverse market segments.

4.1 service segmentation

The clinic patients are of two groups, the day health care patients, and the admitted patients.

Daycare patients

This group of patients will queues in the waiting bay by which under normal circumstances the waiting time will be less than 10 minutes. This is mostly for the patients of minor illnesses but if it is a serious illness the patient will be received instantly without queuing.

Admitted patients

These groups of patients are given beds in the clinic wards and nurses are assigned to care for them. The clinic will have two words whereby each ward will have ten beds. Each ward will have three nurses. Here patients will be provided with breakfast, lunch, and supper.

Target service strategy

The clinic will try to attract the two different groups of patients by applying two strategies. As the highest group of patients is the day health care, the clinic will have two sections that will include a section for the day health care and for the emergency patients and it will as well have an ambulance for the emergency patients (Laurent, 2012).

Competition and service patterns

The competition takes many different forms in the clinics.

National hospitals

These are the hospitals and clinics owned by the government. They offer free treatments to young children below five years, and their pharmacies have drugs whose price has been subsidized.

Local nurse practitioner clinics

These are the individually owned health centers and clinics where you typically know the doctors and nurses, and they know your medical history and are high in personalized services and convenience. These are similar to the Alicia nurse practitioner clinic.

Strategy and implementation summary

The clinic will use their website to develop visibility and disseminate information.

SALES FORECAST

SALES

YEAR 1 YEAR 2 YEAR 3

Day health care $ 20,960,000 $ 39,983,300 $ 43,133,400

Admitted patients $ 23,222,200 $ 56,743,200 $ 64,054,300

Total sales $ 44,182,200 $ 96,726,500 $ 107,187,700

5.1 Competitive edge

The Alicia nurse practitioner clinic edge is to offer superior services to achieve patient’s satisfaction. This is possible through the elimination of some of the services traditionally offered by clinics. For instance, the clinic will only employ skilled doctor and nurses with a previous experience of about two years. The Alicia nurse practitioner clinic will have a competitive edge based on position, timing, and quality of care, availability of patient, after-hour care, weekend hours, quality time, pleasant staff and office environment (Pinson, 2014). As a result, patient satisfaction and high referral rates will be achieved. It is due to the fact that competition among fellow nurse practitioner clinics within the town and its surrounding area is less. Therefore, the rapidly growing population and the limited number of doctors will create a strong opportunity.

Management summary

Dr. John Franklin has experience working with a major health clinic. He is an MBA graduate and has effective knowledge and experience in matters of health.

Personnel plan

The Alicia nurse practitioner clinic is looking forward to employing the following individuals: nurses

Two at month three, an additional person at month six

Pharmaceutical technicians:

Two at month two

Doctors:

Three at month one

Twenty nurses at month two

Payroll

YEAR 1 YEAR 2 YEAR 3

Dr. Franklin $ 4800000 $ 5200000 $ 6000000

Pharmacist $ 5500000 $ 6000000 $ 6000000

Doctors $ 2750000 $ 3000000 $ 3000000

Nurses $ 2200000 $ 2400000 $ 2400000

TOTAL PAYROL$ 15250000 $16600000 $ 17400000

Financial plan

The sections below will outline the important financial information.

8.1 break even analysis

The break-even analysis calculates what will be needed in monthly revenue.

BREAK EVEN ANALYSIS

Monthly revenue break-even $4780800

Assumption: average percent variable cost 40%

Estimated monthly fixed cost $ 2928005

PRO FORMA PROFIT AND LOSS (In dollars)

YEAR 1 YEAR 2 YEAR 3

Payments $441,822 $967,265 $1,071,877

Direct Cost of Sales $176,729 $386,906 $428,751

Other Production $0 $0 $0

Expenses

TOTAL COST $176,729 $386,906 $428,751

OF SALES

Gross Margin $265,093 $580,359 $643,126

Gross Margin 60.00% 60.00% 60.00%

%

Expenses

Payroll $268,620 $322,960 $330,960

Sales and Marketing $8,400 $8,400 $8,400

And other expenses

Depreciation $1,704 $1,704 $1,704

Leased equipment $0 $0 $0

Utilities $4,800 $4,800 $4,800

Insurance $3,600 $3,600 $3,600

Rent $24,000 $24,000 $24,000

Payroll Taxes $40,293 $48,444 $49,644

Other $0 $0 $0

Total operating expenses $351,417 $413,908 $423,108

Profit Before($86,324 $166,451 $220,018

Interest and Taxes

Interest expense $0 $0 $0

Taxes incurred $0 $49,935 $66,005

Net Profit ($86,324) $116,516 $154,013

Net Profit % 19.54% 12.05% 14.37%

PRO FORMA BALANCE SHEET

YEAR 1 YEAR 2 YEAR 3

Assets

Current Assets

Cash $69,525 $167,024 $318,513

Inventory $28,838 $63,135 $69,963

Total current assets $98,364 $230,159 $388,477

Long-term assets $8,500 $8,500 $8,500

Accumulated depreciation $1,704 $3,408 $5,112

Total long term assets $6,796 $5,092 $3,388

Total assets $105,160 $235,251 $391,865

Current liabilities

Accounts payable $32,484 $46,059 $48,660

Long-term Liabilities $0 $0 $0

Total liabilities $32,484 $46,059 $48,660

Paid in capital $183,100 $183,100 $183,100

Capital retained earnings ($24,100) ($110,424) $6,092

Earnings ($86,324) $116,516 $154,013

Total capital $72,676 $189,192 $343,205

Total liability and capital $105,160 $235,251 $391,865

Net Worth $72,676 $189,192 $343,205

RATIO ANALYSIS

YEAR 1 YEAR 2 YEAR

Total Current assets 93.54% 97.84% 99.14%

Long-term assets 6.46% 2.16% 0.86%

Total assets 100.00% 100.00% 100.00%

Current liabilities 30.89% 19.58% 12.42%

Long-term liabilities 0.00% 0.00% 0.00%

Total liabilities 30.89% 19.58% 12.42%

Net worth 69.11% 80.42% 87.58%

Sales 100.00% 100.00% 100.00%

Gross Margin 60.00% 60.00% 60.00%

Selling and administrative expenses 93.39% 44.47% 42.20%

Advertising expenses 1.28% 0.50% 0.45%

Interest and taxes 19.54% 17.21% 20.53%

EMPLOYEE EMPLOYMENT CONTRACT

The agreement was made as of the 10th of October 2016 and was made between the employer and individual employees. The employer owns the institutional practice which has an office located in the center of the town. The employee is licensed to practice in the given area and is otherwise qualified to perform the services required hereunder;

TERMS AND TERMINATION

This agreement is made for two years commencing in October 2016 unless the employee's job is terminated by the employer due to misbehavior and other related activities which show a lack of seriousness in offering the services. This agreement will be renewed for other two-year upon successful completion of the first two years. As per Selena (2011), any breach by an employee of the obligations set forth by the health insurance portability and accountability act (HIPAA), may lead to termination of the job by the employer.

Clinic employee employment and duties

The employee will perform any reasonable task within the scope of his/her knowledge.