Do you want to start a sober living home? If YES, here is a complete guide to starting a sober living home business with NO money and no experience.
Okay, so we have provided you an in-depth sample sober living home business plan template. We also took it further by analyzing and drafting a sample sober living home marketing plan backed up by actionable guerrilla marketing ideas for sober living homes. In this article, we will be considering all the requirements for starting a sober living home business. So put on your entrepreneurial hat and let’s proceed.
Why Start a Sober Living Home Business?
If you live in the United States, Canada and in most developed countries of the world you would agree that it is indeed brisk business taking care of people that are recovering from drugs or alcoholic addictions. Usually, they look for a secured and conducive home to enroll in so that their recovery and perhaps cure from addiction will be smooth and fast, hence the need for a sober living home.
Sober living homes are group homes for people who are recovering from addiction issues. People who live in sober homes have to follow certain laid down rules and of course contribute to the home by doing their own allocated chores.
Many drug and alcohol addicts use sober housing to help them transit from rehab to living independently without using drugs or alcohol. If you think that you have the flair and you are trained to help drug and alcoholic addicts recover from their addictions, then you should consider starting a sober living home in your city.
If you have decided to start a sober living home in your city or county, then you should ensure that you carry out thorough feasibility studies and also market survey. This will enable you to properly identify locations with the right demographic composition (location with a good number of drug and alcohol addicts) and then hit the ground running.
Setting up a sober living home requires hard work and serious planning. You are expected to apply and obtain permit and license to run such facility from the government and your facility must meet the required health and safety standards before you can be allowed to operate a sober living home.
Aside from well – trained domestic employees that will be on your payroll, you will also need to hire nurses, care givers, psychologist et al. Starting a sober living home business is indeed capital intensive, but at the same time it is a lucrative business.
Running a sober living home facility can gulp quite a lot. This is because of the various things that are involved in it. They include renting a facility, paying the workers, furnishing the facility to suit the residents, medications, feeding, as well as some other very essential things that cannot be neglected.
It is for this reason that you may need to source for funds. If you have a great saving culture and have been able to save the amount involved, then that is fine. On the other hand, if not, there may be banks and microfinance banks to turn to for a loan. Also, there are angel investors that may be very interested in supporting your business.
If indeed you want to open your own sober living home facility, then you should read through this article keenly, it will help you establish your own sober living home facility from the scratch and build it to profitability within the shortest time possible.
Starting a Sober Living Home Business – A Complete Guide
- Industry Overview
Operators in the sober living home industry largely provide residential and personal-care services related to diagnosing and treating alcohol, drug and other substance abuse. Demographic trends have supported a growing demand for sober living home franchises, and the industry has experienced strong growth over the last half a decade. This growth is expected to improve, driven by an improving economic environment and the continued addictions to drugs, alcohol and other substances, which will expand the industry’s markets.
The law in the United States and in some countries states that before a sober living home facility can commence operation, there should be at least six residents and at least one trained caregiver there 24 hours a day and 7 days a week. So also, a standard sober living home facility is expected to have a house manager, night manager, weekend activity coordinator, and 2 or more caregivers depending on the size of the facility.
The Sober Living Home Industry is indeed a very large industry and pretty much thriving in developed countries such as United States of America, Canada, United Kingdom, Germany, Australia and Italy et al.
Statistics has it that in the United States of America alone, there are about 5,623 licensed and registered outpatient and inpatient facilities handling drugs, alcohol and substance addicts scattered all across the United States responsible for employing about 126,263 employees and the industry rakes in a whooping sum of $10bn annually with an annual growth rate projected at 4.9 percent between 2011 and 2016. No player in the industry can boast of having a lion share of the available market share in the industry.
A recent report published by IBISWORLD shows that the distribution of substance abuse clinics in the United States largely reflects the distribution of the population throughout the various regions. The report further states that other important factors include the extent of substance abuse, the age distribution of the population, state government policies and the level of urbanization in the region.
The majority of industry clinics are located in the Southeast, the West and the Mid-Atlantic regions. The Southeast accounts for 23.5 percent of substance abuse clinics, according to data sourced from the US Census Bureau’s County Business Patterns. This is slightly below the region’s respective share of the population at 25.4 percent of the nation’s total. Within the Southeast, Florida has the greatest share of industry clinics, measured at 6.5 percent of the total.
It is important to state that the sober living home facility business is indeed a growing business. Even though the business is not considered a green business in the United States of America, one can comfortably say that the business is booming and open to potential entrepreneurs who are interested in the business.
Over and above, the sober living home line of business in developed countries are still enjoying good patronage particularly if they are well positioned and if they know how to reach out to their target market; those addicted to drugs, alcohol and substance abusive.
Starting a Sober Living Home Business – Market Research and Feasibility Studies
- Demographics and Psychographics
The demographic and psychographics composition of those who need the services of a sober living home facility business is restricted to those who are addicted to drugs, alcohol and other substances.
So, if you are looking towards defining the demographics of your sober living home facility business, then you should make it far reaching to everyone who is addicted to drugs, alcohol and other substances, including NGOs who work with people who are addicted to drugs, alcohol and substances in and around the location where your facility is located.
List of Niche ideas Within the Sober Living Home Business That You Can Specialize in
Most sober living home facility businesses tend to operate general services that a standard sober living home facility provider is expected to offer. That is why it seems that there are no niche areas in the industry. But on the other hand, some sober living home facilities may decide to major in some key areas such as;
- Providing inpatient and outpatient services
- Providing detoxification services
- Providing intensive inpatient and outpatient services
- Providing medication-assisted opioid therapy services
The Level of Competition in the Sober Living Home Facility Industry
The level of competition in the sober living home industry to some extent depends largely on the location of the business, your niche area of operation and of course the capacity of your sober living home facility. If you can successfully create a unique niche for your sober living home facility business, you are likely going to experience little or no competition.
For instance, if you are the only sober living home facility business in your location that is into detoxification services or providing intensive outpatient services or providing medication-assisted opioid therapy services, you can successfully monopolize the market for a long time before you start having competitions.
It is important to also state that the competition in the sober living home facility business is not restricted to that line of business but you will be competing against all players in the Home Care Providers industry.
List of Well – Known Brands in the Sober Living Home Industry
It is important to point out the fact that in every industry, there are always brands who perform better or are better regarded by customers and the general public than others. Some of these brands are those that have been in the industry for a long time, while others are best known for how they conduct their businesses and the results they have achieved over the years.
These are some of the leading sober living home facilities in the United States of America and in the globe;
- The Doorway to Recovery – Premier Michigan Sober Living
- Sober Orange County
- Men’s transitional housing in Los Angeles County
- Women’s Sober Living Housing Network
- Promises Treatment Center
- Cirque Lodge
- Caron Foundation
- Sierra Tucson
- Hazelden Treatment Centers
- Betty Ford Center
- Pasadena Recovery Center
- Solutions Recovery Center
- Q Health Palm Beach
When starting a sober living home facility business, you just have to get your costing cum economic analysis right if your intention of building the business is to generate profit, grow the business and perhaps expand the business and start competing at national level.
When conducting costing and economic analysis for your sober living home facility business, you just have to critically examine these key factors; place, pricing and promotion. As a matter of fact, you would have to continue to review these key factors at regular interval while running your sober living home facility business. As a sober living home facility business owner, you just have to have a proper grasp of your competitive landscape if indeed you want to maximize profits and be in the front-line of the industry.
It is important to note that renting, overhead and medication cost are some of the most important factors contributing to the overall cost of running a sober living home facility business and should be considered as a major factor when carrying out your costing and economic analysis.
Starting Your Sober Living Home Facility from Scratch vs Buying a Franchise
If you are looking towards starting a sober living home facility business, you would have to start from the very scratch because you can hardly get a franchise of a sober living home facility business to buy.
Besides starting a sober living home facility business from the scratch is less stressful when compared to other similar businesses. With a sober living home facility business, you should just try as much as possible to secure a good residential facility that is inside a residential estate and then leverage on every marketing tool within your disposal especially the internet to market your sober living home facility.
Please note that most of the big and successful sober living home facilities around started from the scratch and they were able to build a solid business brand.
Possible Threats and Challenges You Will Face When Starting a Sober Living Home Facility
If you decide to open your own sober living home facility today, one of the major challenges you are likely going to face is the presence of well – established sober living home facilities and of course other players in the Home Care Providers industry in your target market location. The only way to avoid this challenge is to create your own market; concentrate on drug and alcohol addicts and those who are into substance abuse in your immediate community.
Some other threats and challenges that you are likely going to face are mature markets, bad economy (economy downturn), stiff competition, volatile costs, and rising medical care prices. So also, unfavorable government policies, seasonal fluctuations, demographic/social factors, downturn in the economy which is likely going to affect consumer spending and of course emergence of new competitors within the same location where yours is located. There is hardly anything you can do as regards these threats and challenges other than to be optimistic that things will continue to work for your good.
Starting a Sober Living Home Business – Legal Matters
- Best Legal Entity to use for this Type of Business
You can either choose a general partnership, limited liability company which is commonly called an LLC, or a sole proprietorship for a business such as sober living home facility. Ordinarily, sole proprietorship should have been the ideal business structure for a small scale sober living home care facility business especially if you are just starting out with moderate startup capital.
But people prefer limited liability Company for obvious reasons. As a matter of fact, if your intention is to grow the business and operate all across the United States of America, then choosing sole proprietor is not an option for you. Limited Liability Company, LLC or even general partnership will cut it for you.
Setting up an LLC protects you from personal liability. If anything goes wrong in the business, it is only the money that you invested into the limited liability company that will be at risk. It is not so for sole proprietorships and general partnerships. Limited liability companies are simpler and more flexible to operate and you don’t need a board of directors, shareholders meetings and other managerial formalities.
These are some of the factors you should consider before choosing a legal entity for your sober living home facility business; limitation of personal liability, ease of transferability, admission of new owners, investors’ expectation and of course taxes.
If you take your time to critically study the various legal entity to use for your sober living home facility business, you will agree that limited liability company; an LLC is most suitable. You can start this type of business as limited liability company (LLC) and in future convert it to a ‘C’ corporation or an ‘S’ corporation especially when you have the plans of going public.
Catchy Business Name ideas Suitable for a Sober Living Home Facility
Normally, when it comes to choosing a name for your business, you should be creative because whatever name you choose for your business will go a long way to create a perception of what the business represents. Typically, it is the norm for people to follow the trend in the industry they intend operating from when naming their business.
If you are considering starting your own sober living home facility business, here are some catchy names that you can choose from;
- Quick Recovery® Sober Living Home Facilities, LLC
- Crest Haven™ Sober Living Home Facility, Inc.
- Cross County Sober Living Home Facility, Inc
- Caring Hands Drugs and Alcohol Rehab Center
- Trans – World® Sober Living Home Center
- Henry Docusate Sober Living Home Facility
- Captee May® Sober Living Home Facility
- Warm Embrace Sober Living Home Facility Services, Inc.
- Bridget Brownstone Sober Living Home Facility Company
- Sharon Holmes Sober Living Home Facility Services, Inc.
In the United States and in most countries of the world, you can’t operate a business without having some of the basic insurance policy covers that are required by the industry you want to operate from. Thus, it is imperative to create a budget for insurance policy cover and perhaps consult an insurance broker to guide you in choosing the best and most appropriate insurance policies for your sober living home facility business.
Here is some of the basic insurance policy covers that you should consider purchasing if you want to start your own sober living home facility business in the United States of America;
- General insurance
- Health insurance
- Liability insurance
- Risk Insurance
- Workers compensation
- Building/Property insurance
- Overhead expense disability insurance
- Business owner’s policy group insurance
- Payment protection insurance
Intellectual Property Protection/Trademark
If you are considering starting your own sober living home facility business, you may not have any need to file for intellectual property protection/trademark. This is so because the nature of the business makes it possible for you to successfully run it without having any cause to challenge anybody in court for illegally making use of your company’s intellectual properties.
On the other hand, if you just want to protect your company’s logo and other documents or software that are unique to you or even operation concepts, then you can go ahead to file for intellectual property protection. If you want to register your trademark, you are expected to begin the process by filing an application with the USPTO.
Is Professional Certification Needed to Run a Sober Living Home Business?
If you intend starting a sober living home facility in the United States of America, you are encouraged to pursue professional certifications; it will go a long way to show your commitment towards the business. Certification validates your competency and shows that you are highly skilled, committed to your career and up-to-date in this competitive market.
Besides it is almost impossible to run a sober living home facility business in the United States without the proper professional certification. In most countries of the world, practicing any medical related practice without a license is illegal. In most jurisdictions, individuals found to be providing medical, nursing or other professional services without the appropriate certification or license may face sanctions including even criminal charges leading to prison.
These are some of the certifications you can work towards achieving if you want to run your own sober living home facility company;
- Registered nurse and Licensed practical nurse Certificate
- AADNS Certification
- Caregiver Certification
- Director of Nursing Services–Certified (DNS-CT)
- QAPI Certified Professional (QCP)
Please note that you cannot successfully run your sober living home facility company without any professional certification especially the basic certifications such as caregiver certification, private Registered Nurse (RN) and Licensed practical nurse.
List of Legal Documents You Need to Run a Sober Living Home Facility
These are some of the basic legal documents that you are expected to have in place if you want to legally run your own sober living home facility company in the United States of America;
- Business and liability insurance
- Federal Tax Payer’s ID
- State Permit
- Certificate of Incorporation
- Business License
- Business Plan
- Health inspection Certificate
- Copy of license for the service support facility and/or a recent inspection report
- Non – disclosure Agreement
- Employment Agreement (offer letters)
- Employee’s Handbook
- Operating Agreement for LLCs
- Insurance Policy
- Company Bylaws
- Memorandum of Understanding (MoU)
- Building License
- Franchise or Trademark License (optional)
Financing Your Sober Living Home Facility
Starting a standard and well – equipped sober living home facility business is capital intensive especially if you choose to launch the business on a small scale and you only have a handful of full – time employees on your payroll. Leasing of a standard facility that can accommodate your residents and staff members and of course the purchase of medical equipment are part of what will consume a large chunk of your startup capital. In essence, if you choose to start the business on a small scale, you will still have the need to go source for fund to finance the business.
Here are some of the options you can explore when sourcing for startup capital for your sober living home facility business;
- Raising money from personal savings and sale of personal stocks and properties
- Raising money from investors and business partners
- Sell of shares to interested investors
- Applying for loan from your bank
- Pitching your business idea and applying for business grants and seed funding from government, donor organizations and angel investors
- Source for soft loans from your family members and your friends
Choosing a Suitable Location for your Sober Living Home Business
Starting a business such as sober living home facility business comes with its own challenges; it is a business that cannot be started in any location. As a matter of fact, you will need approval from your local council and other regulating authorities in the city you intend opening your sober living home facility business.
Generally, in business, it cannot be overemphasized that the location you chose to start your business is key to the success of the business, hence entrepreneurs are willing to rent or lease a facility in a visible location; a location where the demography consists of the people who are addicted to drugs and other substances, and of course people with the required purchasing power and lifestyle.
Most importantly, before choosing a location for your sober living home facility business, ensure that you first conduct a thorough feasibility studies and market survey. The possibility of you coming across similar business that just closed shop in the location you want to open yours can’t be ruled out. This is why it is very important to gather as much facts and figures before choosing a location to set up your own sober living home facility business.
These are some of the key factors that you should consider before choosing a location for your sober living home facility business;
- The demography of the location
- The demand for the services of sober living home facilities and other homecare related businesses in the location
- The purchasing power of the residents of the location
- Accessibility of the location
- The number of sober living home facilities and homecare related services businesses that in the location
- The local laws and regulations in the community
- Traffic, parking and security
Starting a Sober Living Home Business – Technical and Manpower Details
When it comes to starting a standard sober living home, you will need stethoscopes, Blood Pressure Cuffs, oxygen tanks, first aid kits and other related equipment that will aid you in carrying out your job. It is important to state that these equipment can be purchased as fairly used if you are operating on a low budget. In setting up a small office for your sober living home facility, you will also need computer, printer, home healthcare software, telephones, pager, photocopier, scanner, fax machine, first aid kit, gloves and uniform.
When it comes to choosing between renting and leasing a facility for your sober living home facility business, the size of the facility you want to own, and your entire budget for the business should influence your choice. Besides, you will need a facility in a serene environment, a facility that is big enough to accommodate the number of residents and staff member working for you.
As regards the number of employees that you are expected to kick start the business with, you would need to consider your finance before making the decision. Averagely, when it comes to starting a standard sober living home business on a large scale, you would need the services of the following professionals; Chief Operating Officer (you can occupy this position), Marketing and Sales Executive (Business Developer), Accountant, Nurse Aide, Medication Management Counselors, Sober Living Home Administrator (Human Resources and Admin Manager), Customer Services Executive/Front Desk Officer, Security Guards and Cleaners.
Over and above, you would need a minimum of 10 to 15 key staff members to effectively run a medium scale but standard sober living home facility.
The Service Delivery Process of a Sober Living Home Facility
The service delivery process as it relates to sober living home facility to a large extent depends on the organization and what they stand to achieve.
Basically, a sober living home facility business sources for clients, once they are able to win a client over based on the services they intend offering and the facility available, they will both agree on the terms and conditions as required by the nature of the job they are to execute.
For example, if it is to help someone who is addicted to drugs or alcohol or substance abuse to get over their addictions for a period of time, they will ensure that they carry out all that is agreed upon. Besides, the services could be providing inpatient and outpatient services, providing detoxification services, providing intensive inpatient and outpatient services, and providing medication-assisted opioid therapy services et al.
It is important to state that a sober living home facility business may decide to improvise or adopt any business process and structure that will guarantee them efficiency and flexibility; the above stated sober living home facility business process is not cast on stone.
Starting a Sober Living Home Business – The Marketing Plan
- Marketing ideas and strategies
The fact that the entry barrier for starting a small – scale sober living home facility business is low means that there is bound to be more players in the industry no matter the location you choose to start yours. In essence, you must come up with creativity and innovations if you must carve out a market for yourself within the available market in your community, city, state or country.
So, when you are drafting your marketing plans and strategies for your sober living home facility, make sure that you create a compelling personal and company profile. Aside from your qualifications and experience, it is important to clearly state in practical terms what you have been able to achieve in time past as it relates to your line of business. This will help boost your chances in the market place when marketing your services.
Here are some of the platforms you can utilize to market your sober living home facility;
- Introduce your business by sending introductory letters alongside your brochure to households, hospitals, religious organizations, clubs/organizations, campuses and NGOs et al who work with people who are addicted to drugs and alcohol and also those who are into substance abuse around the location where your sober living home facility is located
- Open your sober living home facility with a party so as to capture the attention of residents who are your first targets
- Engage in roadshows in targeted communities from time to time to market your services
- Advertise your services in community based newspapers, local TV and radio stations
- List your business and products on yellow pages (local directories)
- Leverage on the internet to promote your sober living home facility
- Engage in direct marketing and sales
- Encourage the use of word of mouth marketing (referrals)
- Leverage on the internet to promote your business
- Join local chambers of commerce and industries around you with the main aim of networking and marketing your services; you are likely going to get referrals from such networks
- Engage the services of marketing executives and business developers to carry out direct marketing for you
Strategies to Boost Your Sober Living Home Brand Awareness and Create Your Corporate Identity
If your intention of starting a sober living home facility business is to grow the business beyond the city where you are going to be operating from to become a national and international brand by opening chains of sober living home facilities and franchising, then you must be ready to spend money on promotion and advertisement of your brand.
No matter the industry you belong to, the truth is that the market is dynamic and it requires consistent brand awareness and brand boosting cum promotion to continue to appeal to your target market. Here are the platforms you can leverage on to boost your brand awareness and create corporate identity for your sober living home facility business;
- Place adverts on both print (newspapers and health magazines) and electronic media platforms
- Sponsor relevant community based events
- Leverage on the internet and social media platforms like Instagram, Facebook, Twitter, YouTube, Google + et al to promote your services
- Install your billboards in strategic locations all around your city or state
- Engage in roadshows from time to time in targeted neighborhoods to create awareness for your sober living home facility
- Distribute your fliers and handbills in target areas
- Contact households, hospitals, religious organizations, clubs/organizations, campuses and NGOs et al who work with people who are addicted to drugs and alcohol and also those who are into substance abuse around the location where your sober living home facility is located informing them of the services you offer
- List your sober living home facility in local directories / yellow pages
- Advertise your sober living home facility in your official website and employ strategies that will help you pull traffic to the site
- Position our Flexi Banners in strategic positions in the location where your sober living home facility is located
- Ensure that all your staff members wear your branded shirts and all your vehicles are branded with your company logo et al.