Do you want to know how much it costs to start a private ambulance business? If YES, here are 13 factors that determine the cost of opening a private ambulance service.
The Ambulance Services industry comprises both private and municipal operators that basically provide transportation alongside medical care for patients either by ground or air. Ambulances are usually equipped with lifesaving equipment operated by medically trained employees i.e., nurses and doctors et al.
In the United States, most hospitals don’t own ambulances. If you call the hospital in a medical emergency, they will tell you to hang up and dial 911. Ambulances are mostly owned either by fire departments (or other public agencies) or independent ambulance services (private businesses).
The Ambulance Services industry is a thriving industry that rakes in over $16 billion annually with an annual growth rate projected at 2.5 percent interestingly, the industry is open to any aspiring entrepreneur who has acquired the required capital and business exposure.
Estimated Cost Breakdown to Start an Ambulance Service
When it comes to starting an ambulance services business, one is expected to spend the bulk of the startup capital on purchasing and equipping different types of ambulances and of course renting and equipping a parking facility. Aside from that, you are also expected to secure the required license and permits, service, maintain and fuel the vehicles, then pay your employees and utility bills.
In view of that, here are the key areas where you are expected to spend your startup capital on if you want to start an ambulance services business;
- The total fee for registering a business in the United States of America – $750.
- Legal expenses for obtaining licenses and permits as well as the accounting services (software, P.O.S machines, and other software) – $3,300.
- Marketing promotion expenses for the grand opening of the business in the amount of $3,500 and as well as flyer printing (2,000 flyers at $0.04 per copy) for the total amount of $3,580.
- The cost for hiring a business consultant including writing a business plan – $2,500.
- Insurance (general liability, workers’ compensation, and property casualty) coverage at a total premium – $12,400.
- The cost for payment of rent for 12 months at $1.76 per square foot in the total amount of $146,000.
- The cost for office and parking lots construction – $60,000.
- Other start-up expenses including stationery ($500) and phone and utility deposits ($2,500) – $3,000
- Operational cost for the first 3 months (salaries of employees, payments of bills et al) – $90,000
- The cost for purchasing the first set of ambulances and medical equipment – $450,000
- The cost for equipment and accessories – (GPS, dependable phone, internet access on the road, safety equipment, basic tools, spare parts, gasoline and diesel, brake fluid and engine oil, uniforms, safety boats, and hand gloves et al) – $100,000
- The cost for store equipment (cash register, security, ventilation, signage) – $3,750
- The cost of purchase and installation of CCTVs and car tracker software- $22,500
- The cost for the purchase of furniture and gadgets (Computers, Printers, Telephone, TVs, Sound System, tables and chairs et al) – $4,000.
- The cost of launching a Website – $600
- Miscellaneous – $5,000
From the rough estimate listed above, you would need a minimum of eight hundred and ninety – two thousand, nine hundred and twenty USD ($892,920) to establish a medium–scale but standard ambulance services business with about a dozen ambulances in any city in the United States of America.
Please note that this is a rough estimate and we usually advise our readers who are interested in opening an ambulance services business to directly contact suppliers of the brand of ambulances and medical equipment they would need to get the real-time prices of these items.
The truth is that if you are a good bargainer, you can get a better deal that will help you beat down the estimated price as listed above.
Factors That Influence the Cost Of Opening an Ambulance Business
Table of Content
- The Brand and Number of Ambulances You Are Starting With
- The Choice of Location
- The Required Licenses and Permits
- The Type of Facility
- Additional Service Offerings
- The Cost of Hiring and Paying a Business Consultant and Attorney
- The Cost for Branding, Promotion, and Marketing
- The Cost of Furnishing and Equipping Your Facility
- The Cost of Insurance
- The Cost of Registering the Business
- Source of Your Supplies and Ongoing Expenses
- Cost of Recruiting and Training Your Staff
- The Cost for the Purchase and Customizing of Uniforms
The Brand and Number of Ambulances You Are Starting With
A major factor that will determine the overall cost of opening an ambulance services business in the United States of America is the number and brands of ambulances you intend to start the business with. For example, if you choose to start with an air ambulance, you are expected to spend far more than those who intend to start on-ground ambulance services.
The Choice of Location
Another major factor that will determine the cost of opening an ambulance services business in the United States of America is your location.
In business, location is a key part of what determines the success of the business. As a matter of fact, there are business consultants cum realtors who are specialized in helping people choose an ideal location for their type of business; a location that will guarantee them profitability within the shortest time frame.
The truth is that the location you choose to open your ambulance services business determines if you will be issued the required business license and permits. Government officials must first inspect your facility to be sure that it is located in the location zoned for such business.
Please note that in the United States of America zoning violations and citations can be very costly for a business. It is always preferable to make sure you comply with all the zoning and land use laws before you choose a location for your business or you stand the risk of having the business closed down before it even gets started.
The Required Licenses and Permits
In the United States of America, you cannot open an ambulance services business without first applying for mandatory licenses and permits. Top on the list is that you would need an Ambulance Operator’s Registration license.
You will be expected to pay the $300 dollar application fee to the Federal Motor Carrier Safety Administration and apply for a freight broker’s license and a USDOT number. You will also need, building licenses, zonal permits, and signage permits amongst others that may be unique to different cities and states.
These license and permits cost money and it will influence the overall cost of opening an ambulance services business in the United States of America.
In order to get the overall cost of licensing and permits associated with opening a new ambulance services business in the United States, we will advise that you reach out to your county, city council, or state government. You also need to consider state and federal requirements.
The Type of Facility
The type of facility you want to run your ambulance services business from is also a major factor that will determine the overall cost of opening this business in the United States. As regards the facility, you have the option of renting, leasing, or designing and constructing your own facility from the scratch.
With renting and leasing a facility, you will just spend a little to modify the facility to fit into what you have in mind, but there is a limit to how far you can go and it will be dependent on what the landlord of the facility wants.
Let us assume that you want to construct your ambulance services business facility from the scratch. It means that you will buy the land or property, and construct and equip the facility to fit into the ideal picture you have in mind. You will agree that you are going to spend way more when compared to people that rent or lease a facility.
Additional Service Offerings
Another key factor that will determine the cost of opening and operating an ambulance services business in the United States of America is, of course, the additional services offerings of the ambulance services business. The fact that there is no one mold fits all means that these ambulance services businesses are designed to offer different services.
For example, an ambulance services business may decide to provide both emergency and nonmedical emergency medical transportation services (air or ground) or even decide to go into the servicing and maintenance of ambulances for clients.
This means that they will need additional facilities, equipment, and staff to handle this aspect of the business. In essence, some of the additional services you are going to be offering will cost you more.
The Cost of Hiring and Paying a Business Consultant and Attorney
If you want to get your business started on the right foundation, it will be a wise decision to hire the services of a competent business consultant and perhaps an attorney.
A business consultant will help with drafting a workable business plan document for the business, a marketing plan and strategy, a comprehensive SWOT, and provide other advisory services. An attorney on the other hand will help you with registering the business, drafting contract documents, and offering you all the legal expertise that will help you start the business on the right foundation.
Of course, you will agree that these services will cost you money and it will indeed influence the overall cost of opening an ambulance services business in the United States of America.
The Cost for Branding, Promotion, and Marketing
The cost of branding, promoting, and marketing the ambulance services business is yet another key factor that will determine the overall cost of opening an ambulance services business in the United States of America. Trust me, if you need massive results as it relates to competing and winning a fair share of the available market in your city, then you must be willing to pay for effective branding, promotion, and marketing.
As a matter of fact, it is not cheap to come by an expert in branding, promotion, and marketing that will help you compete with brands that are already determining the market direction of the industry in your city. So, if you add the cost of paying a branding and marketing expert, it will surely increase the cost of opening your business.
The Cost of Furnishing and Equipping Your Facility
Another very important factor that will determine the cost of opening an ambulance services business is of course the cost of furnishing and equipping the facility. You will quite agree that aside from the basic facilities that are found in an ambulance services business facility, an investor that wants to open such a business may decide to spend more to make his or her facility to be unique.
As expected, before you can open an ambulance services business, you should budget for medical equipment and supplies, flat-screen TVs, sound system, internet facility, GPS tracker, office furniture (table, stools, and sofas), drawers and cabinets, telephones, filing cabinets, office equipment (cash register, security, CCTV, ventilation, signage), amongst others. All these will cost money and it will influence the overall cost of opening your facility.
The Cost of Insurance
The cost of paying for insurance is yet another important factor that will determine the overall cost of opening an ambulance services business in the United States of America.
In the United States and in most countries of the world, you can’t operate a business without having some basic insurance coverage. 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 policies for your business.
But all in all, you would need to make plans to purchase general insurance, liability insurance, health insurance, commercial hull insurance, physical damage insurance, uninsured or underinsured motorist and motor vehicle insurance (comprehensive insurance) et al and this will cost you money.
The Cost of Registering the Business
The cost of registering the ambulance services business is yet another cost that will influence the overall cost of opening an ambulance services business in the United States of America. Although the cost of registering a business is minimal, it will still add to the overall cost of opening an ambulance services business in the United States of America.
Source of Your Supplies and Ongoing Expenses
Another major factor that will determine the cost of opening an ambulance services business in the United States of America is the source of your supplies such as medical supplies and equipment that are found in ambulances, gasoline or diesel, then maintenance et al.
If you have in-house maintenance technicians, it will increase your profitability while running the ambulance services business.
Cost of Recruiting and Training Your Staff
The fact that you are opening your ambulance services business as a new business means that you are expected to recruit and train your staff. The training will help you sell the corporate culture of your organization to your new employees.
As expected, it will cost you money to hire expert trainers that will help you train and bring your new hires up to speed and that will add to the overall cost of opening an ambulance services business.
The Cost for the Purchase and Customizing of Uniforms
Another factor that will determine the overall cost of opening an ambulance services business in the United States is the cost of the purchase and customizing of uniforms to be worn by your employees.
Your staff (doctors, nurses, drivers, and assistants) and of course security personnel are expected to all have different uniforms and they are expected to put on these uniforms when they are on duty. All these uniforms will cost you money which is why they must be part of your budget.
Please note that there are other factors not listed above that will surely influence the overall cost of opening your ambulance services business which is why we will advise that you work with a result-driven business consultant in your city to give you the needed guide and info as it relates to the unique factors in your location that will influence the overall cost of opening your ambulance services business in the United States of America.