There is a rapid rise in the need for assisted living homes, and that need will only continue to grow. For individuals who are at all interested in starting your own RAL home, this article will be a great guide. At the beginning stages, when your interest is initially sparked, it’s normal to have a lot of questions. We’ve condensed this content in order to give readers a brief introduction to the industry. The reason most seniors go to assisted living facilities is because they can’t completely take care of themselves and need help, especially with activities of daily living. They may need help getting dressed, eating or preparing food, bathing or maybe even using the toilet. Even though they may need help in certain areas, residents who are physically able can still come and go as they please.
It can be costly staying at an assisted living home, but not as expensive as living in a nursing home. It is not cheap to get started with an assisted living home.
It requires a large amount of money and reading articles like this to find out the best steps to take. The following pointers and seven steps are highlighted as need-to-know information to get started in the residential assisted living industry.
A Summary Of Steps For Getting Started From Scratch
- Acquire Land and A Home
You will need to acquire land and a house for your RAL home. You will also need to secure the proper financing for such a major project.
- Contract a Real Estate Agent
Find a real estate agent that knows local zoning laws.
- Hire an Architect and Building Contractors
Hire your own architect that both understands all the rules and regulations pertaining to designing such a home, according to legal code.
- Apply for Permits
Make sure to apply for all the state and commercial building permits.
- Hiring the Right People and Using the Right Products
Only hire experienced personnel and make sure the materials used meet all federal and state standards.
- Secure the Necessary License
Get the various licenses you need. All of this can be done while the home is actually being built or remodeled.
- Purchase Furniture
Be sure to get all the furniture you will need throughout your RAL home to make it as comfortable and convenient as possible.
- Plan for Marketing and Advertising
Word of mouth is the best advertising. Hold an open house to show off your new facility. Even with these suggestions, you’ll have a long way to go to maximize your opportunity in the assisted living industry. These seven steps are only a brief summary of the work and planning involved with starting a residential assisted living home. So much more information and advice is needed in order to be successful. This is why the Residential Assisted Living Academy offers a 3-day accelerated course that has helped hundreds of existing owners and operators gain success, as well as novice entrepreneurs getting started for the first time. Eight of the most frequently questioned first steps for investing, owning and operating a RAL home are as follows:
- Business Plan
- Form A Legal Entity
- Register For Taxes
- Open A Business Bank Account
- Secure Necessary License And Insurance
- Define Your Brand
- Market & Establish An Online Presence
Eight Steps To Starting An Assisted Living Home
Do you have a great RAL business idea, you’re ready for the next step, but don’t know how to get started? There’s a lot of work that goes into starting a business. Here are seven steps that will help you make sure your business is well planned, properly registered and in legal compliance.
Step 1: Business Plan
Every entrepreneur needs a clear plan for success. Mapping out the specifics in your business plan can expose some unknowns. Four questions to keep in mind are:
- What are the startup expenses and ongoing cost?
- What will the name of your business be?
- How long will it take to earn what you spent to launch your business?
- Who is your target market?
The Money Involved In Opening An Assisted Living Home
You can always lease an existing home, but keep your options open for a purchase or building from the ground up. Other additional costs may include utilities, wages, internet, security cameras, computer hardware, bedding, medical equipment, food and drinks for the residents. You may also decide to purchase software that is designed to reduce the challenges caregivers face working in assisted living. These expenses will make your operation run more efficiently.
Ongoing RAL Operational Expenses
Some of the ongoing expenses are employee wages, utilities, internet, insurance, supplies and funds owed for the property itself. A state manager for one of these facilities will likely demand a salary between $35,000 and $75,000. A marketing director will be needed, if you don’t do your own advertising. Marketing directors could cost anywhere from $40,000 to $70,000 per year. Your caregivers and kitchen staff may run you about $10 and $15 per hour, usually caregivers are paid minimum wage plus a few dollars, depending on experience. The cost of food all depends on what quality of food you provide. The size of your facility usually determines your utility cost. Things like medical supplies and bedding must be replaced as needed. You will probably spend close to $500 to $1,000 per month on supplies. Adjust your budget accordingly to better gauge your clientele’s needs and demands.
Your Target Market
Your goal should be to house as many residents as your RAL home can reasonably, safely and comfortably accommodate. The younger the patient the more ideal, because they are more likely to live longer and stay in your home longer. An extended stay in a RAL home is a consistent source of income.
How Will You Make Money?
Residential assisted Living homes make money by charging all residents a monthly fee to live there, usually starting at $3,650 for a quality care home, and depending on service, location and amenities could be as high as $7,000 to $8,000.
How Much Profit Can Be Made?
It depends on the size, what it offers and occupancy. If you have a huge home with top notch service and amenities, profits have the potential to sky rocket. If you build a brand and decide to open other homes, you could very well make millions in profit. It is all down to the planning, execution and management of your RAL business. There are a few things you could consider when thinking of ways to see more profit at your facility. Try offering auxiliary services on site. Charge residents additional fees for optional services like cable TV packages, dining options, on site entertainment, specialized care, and other unique services. If your facility reaches full capacity, it’s possible to get financial kickbacks by referring people to other available facilities.
What Name Will You Choose For Your Business?
It is a good idea to check to see if the name you are considering is available as a web domain. If so, secure it before the name is taken. After getting your domain name established, you should definitely consider creating a professional online presence.
Step 2: Form A Legal Entity
Creating a LLC helps to prevent you from being personally held responsible for lawsuits. There are a few business structure options to choose from, such as, corporations, LLC’s, and DBA’s. A registered agent service could also help protect your privacy and ability to stay compliant. LLC’s are easy to register yourself. This is the route most small businesses go.
Step 3: Register For Taxes
There are a variety of both federal and state taxes that need to be registered before you can open a business. In order for you to properly register for tax purposes, you first need to apply for an EIN. This is a simple and easy process – it is also free. Just go to the IRS website.
Step 4: Open A Business Bank Account
A business banking and credit account is essential for personal asset protection. When you mix your business accounts with your personal accounts, you put yourself at risk, especially if your business is ever in a lawsuit. This is for your personal protection, and it also helps businesses to stay organized, which makes accounting and tax filing much easier. Keep an accurate and detailed account of all your expenses. Understanding the financial workings of your business is critical. Always record your various expenses and sources of income. This also simplifies filing your taxes.
Step 5: Secure Necessary License and Insurance
Without the proper permits and licenses, you are subject to hefty fines, or even getting your business shut down. A good source to learn more about licenses requirements in your state is by visiting SBA’s reference to state licenses and permits. Assisted living homes usually operate based on zoning laws, building codes, and government regulations. It’s usually the landlord’s responsibility to obtain a certificate of occupancy. After completing major renovations, a new certificate of occupancy is usually needed. Also, all business owners and operators should have insurance – it is imperative. Workers compensation insurance may be a legal requirement in your state when you hire employees.
Step 6: Define Your Brand
Your brand is what your company stands for and how you want the public to perceive you. A strong brand can help set your business apart from your competitors. Your current residents may be your biggest asset, so use word of mouth wisely to promote your RAL home. Advertising your facility in local newspapers, magazines, radio spots, and TV ads can also prove useful, depending on your demographic. Having an online presence will accelerate the success of your business. Although a lot of seniors are not familiar with the internet, it is likely that their families will be. Bolster your search engine optimization to make it easier for your business to be found online.
Step 7: Market & Establish An Online Presence
A detailed and professional business website allows customers to learn more about your RAL business at the convenience of their fingertips. Social media is also a great tool to use to attract more residents and their family members.
The Ral Academy Makes The Process Easier
There are so many more details that owners and operators need to learn beyond this introduction and 7 steps. The Residential Assisted Living Academy is an assisted living education company that teaches everything from A-Z about meeting the rising demand for senior housing. Gene Guarino, founder of the Residential Assisted Living Academy (RALA), is an American businessman and author. He operates through a number of companies that he owns, which includes Family Legacy Homes, Residential Assisted Living (RAL) National Association, and Pitch Masters. Guarino’s 3-day accelerated RAL course empowers students to achieve true financial independence. He owns and operates his own RAL homes and has students across the country that are also benefiting from this lucrative niche. The RAL Academy’s motto is “Do Good and Do Well.”Register today to attend the next 3-day course by clicking here, www.RALAcademy.com.