Start a midwifery business by following these 9 steps:
You have found the perfect business idea, and now you are ready to take the next step. There is more to starting a business than just registering it with the state. We have put together this simple guide to starting your midwifery business. These steps will ensure that your new business is well planned out, registered properly and legally compliant.
STEP 1: Plan your Business
A clear plan is essential for success as an entrepreneur. It will help you map out the specifics of your business and discover some unknowns. A few important topics to consider are:
- What are the startup and ongoing costs?
- Who is your target market?
- How long it will take you to break even?
- What will you name your business?
Luckily we have done a lot of this research for you.
What are the costs involved in opening a midwifery business?
When opening a midwifery business, entrepreneurs have an extensive list of needs. Part of why women choose midwives in their birthing plan is to have options regarding how and where they give birth. Since some women will want to birth in the comfort of their own home, many of your supplies will need to be portable. A percentage of your clients will, however, want to birth at your establishment, so it’s also important that you purchase or lease a space that can comfortably handle multiple births at once. Choose a location that is easily accessible, clean, and has a calming feel for your birthing mothers.
In addition to your space, you’ll need to budget for approximately $25,000 for the following supplies to get the business started:
- General medical equipment and supplies
- Blood sugar equipment
- Resuscitation equipment
- Birth kit
- IV equipment
- Needles and syringes
- Blood collection equipment
- Catheterization equipment
- Cleaning solutions and equipment
- Birthing tub kit
- Marketing materials, including an educational website, business cards, and brochures
What are the ongoing expenses for a midwifery business?
As a midwifery business owner, your largest expense is your physical location and supplies. Below are a few items you’ll want to budget for in your monthly expenses:
- Maintaining adequate supplies
- Advertising and website maintenance
- Continuing education
Who is the target market?
Your customers will be limited to a very specific group of individuals. Many expecting mothers are still choosing the path of birthing in a hospital, with a physician overseeing the process. Some of these women will be your clients, as many are now choosing to have both a midwife and a doctor in the room, with the purpose of ensuring a system of checks and balances. Others choose a more natural path, removing physicians from the equation entirely. This will provide the framework for your customer base, with many of them becoming an extension of your family.
How does a midwifery business make money?
While the cost of a midwife is significantly lower than a hospital birth, most insurance companies will not cover a midwife’s fee. Fees are agreed upon between the midwife and family, with many expecting families paying out of pocket. Due to the cost, many midwifery businesses accept payment plans, with the final payment due at 37 weeks.
How much can you charge customers?
Midwifery fees vary depending upon location and specific services needed. Many centers report charging between $3,500 and $5,000 per birth.
How much profit can a midwifery business make?
If you assist in the birth of 3 babies a month and charge $3,500 per birth, your agency will earn $126,000 before expenses. Hiring one or two additional midwives will not only help cover overhead costs, it can almost double your business’ profit, depending upon the pay scale you and the midwife agree upon.
How can you make your business more profitable?
The following are a few strategies other birthing centers have implemented to ensure a more profitable business:
- Partner with local obstetricians and hospitals and offer assistance during hospital births when requested
- Offer lactation consultations
- Host regular events, such as prenatal yoga and infant CPR classes
- Offer additional classes that would interest expecting parents - nutrition, prenatal, and breastfeeding
- Many families choose to save the placenta, so this is a great service to include in your business’ portfolio
What will you name your business?
Choosing the right name is very important. Read our detailed guide on how to name your business. We recommend checking if the business name you choose is available as a web domain and securing it early so no one else can take it.
After registering a domain name, consider setting up a professional email account (@yourcompany.com). Google's G Suite offers a business email service that comes with other useful tools, including word processing, spreadsheets, and more. Try it for free
STEP 2: Form a legal entity
Establishing a legal business entity such as an LLC prevents you from being personally liable if your midwifery business is sued. There are many business structures to choose from including: Corporations, LLC's, and DBA's.
Form Your LLC
Read our Guide to Form Your Own LLC
Check out the Top Business Formation Services from our friends at StartupSavant.
You should also consider using a registered agent service to help protect your privacy and stay compliant.
STEP 3: Register for taxes
You will need to register for a variety of state and federal taxes before you can open for business.
In order to register for taxes you will need to apply for an EIN. It's really easy and free!
You can acquire your EIN for free through the IRS website, via fax, or by mail. If you would like to learn more about EINs and how they can benefit your LLC, read our article, What is an EIN?.
STEP 4: Open a business bank account & credit card
Using dedicated business banking and credit accounts is essential for personal asset protection.
When your personal and business accounts are mixed, your personal assets (your home, car, and other valuables) are at risk in the event your business is sued. In business law, this is referred to as piercing your corporate veil.
Open a business bank account
- This separates your personal assets from your company's assets, which is necessary for personal asset protection.
- It also makes accounting and tax filing easier.
Recommended: Find the right bank for you, read our review of the Top 5 Banks for Your Small Business
Get a business credit card
- This helps you separate personal and business expenses by putting your business' expenses all in one place.
- It also builds your company's credit history, which can be useful to raise money and investment later on.
STEP 5: Set up business accounting
Recording your various expenses and sources of income is critical to understanding the financial performance of your business. Keeping accurate and detailed accounts also greatly simplifies your annual tax filing.
STEP 6: Obtain necessary permits and licenses
Failure to acquire necessary permits and licenses can result in hefty fines, or even cause your business to be shut down.
State & Local Business Licensing Requirements
Generally, midwives must be certified as either CPMs or CNMs and take a national midwifery exam. Information about certification can be found here.
The American Public Health System has published guidelines for licensing birthing centers. These guidelines can be found here.
Most businesses are required to collect sales tax on the goods or services they provide. To learn more about how sales tax will affect your business, read our article, Sales Tax for Small Businesses.
Most states require birthing center licenses. Learn more about licensing requirements in your state by visiting SBA’s reference to state licenses and permits.
For information about local licenses and permits:
- Check with your town, city or county clerk’s office
- Get assistance from one of the local associations listed in US Small Business Associations directory of local business resources.
Midwife businesses should consider requiring clients to sign a service agreement before starting a new project. This agreement should clarify client expectations and minimize risk of legal disputes by setting out payment terms and conditions, as well as service level expectations. Here is an example service agreement.
Recommended: Rocket Lawyer makes it easy to create a professional service agreement for your midwife business when you sign up for their premium membership. For $39.95 per month, members receive access to hundreds of legal agreements and on call attorneys to get complimentary legal advice.
STEP 7: Get Business Insurance
Just as with licenses and permits, your business needs insurance in order to operate safely and lawfully. Business Insurance protects your company’s financial wellbeing in the event of a covered loss.
There are several types of insurance policies created for different types of businesses with different risks. If you’re unsure of the types of risks that your business may face, begin with General Liability Insurance. This is the most common coverage that small businesses need, so it’s a great place to start for your business.
Learn more about General Liability Insurance.
Another notable insurance policy that many businesses need is Workers’ Compensation Insurance. If your business will have employees, it’s a good chance that your state will require you to carry Workers' Compensation Coverage.
STEP 8: Define your brand
Your brand is what your company stands for, as well as how your business is perceived by the public. A strong brand will help your business stand out from competitors.
How to promote & market a midwifery business
Historically, the women who chose natural births with midwives was a tight knit group within the community. Word of mouth was a midwife’s greatest marketing tool. However, as word spreads regarding the benefits of working with a midwife, centers are finding new marketing opportunities.
Midwife birthing centers have found success implementing the following marketing strategies:
- Partner with pediatricians within the community who support a more natural approach to treating their patients. Their support and recommendation will take you farther in gaining valued clients.
- Purchase ads in local publications, particularly those geared towards families.
- Feature a blog on your website and share on social media. Focus on topics your expecting parents would inquire about, establishing yourself as an educator and leader in your industry.
- Host workshops geared towards new families.
- Google and Facebook ads are a great way to get your name out in the community.
How to keep customers coming back
Due to the services you’ll be providing, word of mouth is critical to attracting clients. How you treat them and how comfortable you make them from the moment you meet will define the relationship built. Women made to feel comfortable and in control will pass on their positive experience to others, encouraging them to consider you for their birth. Keep track of your clients once the baby arrives. They will, undoubtedly, consider you a part of their family and will look to you should they decide to have multiple children.
STEP 9: Establish your Web Presence
A business website allows customers to learn more about your company and the products or services you offer. You can also use social media to attract new clients or customers.
Start A Midwifery Business In Your State
Select your state below for an in-depth guide on completing each of these steps in your home state.
Is this Business Right For You?
Owning a midwifery business offers a unique opportunity to help families welcome their little bundle of joy into the world on their terms. Because newborns come when they’re ready, midwives must have the ability to keep a free schedule, prepared to jump in at a moment’s notice. This is a wonderfully rewarding career for the compassionate and loving individual who enjoys connecting and interacting with people on a more intimate level.
What happens during a typical day at a midwifery business?
In the midwifery business, no two days are alike. Even if you’re able to welcome multiple babies into the world each day, every family’s wishes and needs will be unique, as is each birthing experience.
While this will vary from day-to-day, most days will include the following activities:
- Conduct interviews with families to get a feel for what their birthing needs are
- Schedule and carry out regular prenatal checkups to ensure the pregnancy is progressing safely
- Meet with mothers swiftly when they sense something isn’t right with their body or unborn baby
- Assist families with whatever they require, once labor has begun
- Deliver the baby and care for both mother and baby immediately after birth and assess the health and wellbeing of both
- Provide care and advice if emergency interventions are required
- Market your business
- Consistently research to ensure your business is current with the best midwifery practices
- Follow up with families after birth
Additionally, there will be administrative duties to attend to, such as ordering supplies and paying bills. Many midwife business owners delegate these responsibilities to their trusted staff, so they can focus on the needs of their “customers.”
What are some skills and experiences that will help you build a successful midwifery business?
Because emotions can be high throughout the birthing experience, midwives must be strong and confident individuals. Attention to detail is critical, as a newborn’s life (as well as the mother’s) is in your hands. If something goes awry, you must be able to firmly, confidently, and calmly explain the situation to your birthing family and be able to execute an alternate plan swiftly, while still considering the outlined birthing plan. Additionally, it’s important to understand that these families are looking to you for guidance throughout this process. The ability to listen to your clients, often reading between the lines, is important, as is a passion for educating them every step of the way.
Those considering entering the profession can take two different paths to get there (depending upon your state). Certified nurse-midwives (CNMs) receive a degree in nursing, spending years completing their education. Some states also allow “direct-entry” midwives to practice, once they’ve completed an apprenticeship program with an experienced midwife. Regardless of which path you choose, the Midwives Alliance of North America offers a wealth of information regarding midwifery education, advocacy, and research.
What is the growth potential for a midwifery business?
More and more expecting families have realized the value behind having a midwife present during birth, helping to remove the “hippie” label that was once present. In fact, the industry is expected to grow by 31% by 2020, offering great opportunity for success for those considering opening a midwifery business. Growth opportunities are directly related to demand in your area and affordability of services, as well as the availability of other midwives in your region.
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Take the Next Step
Find a business mentor
One of the greatest resources an entrepreneur can have is quality mentorship. As you start planning your business, connect with a free business resource near you to get the help you need.
Having a support network in place to turn to during tough times is a major factor of success for new business owners.
Resources to Help Women in Business
There are many resources out there specifically for women entrepreneurs. We’ve gathered necessary and useful information to help you succeed both professionally and personally:
If you’re a woman looking for some guidance in entrepreneurship, check out this great new series Women in Business created by the women of our partner Startup Savant.
What are some insider tips for jump starting a midwifery business?
The following are some insider tips from individuals who have found success in this ever-growing industry:
- Get involved with organizations such as the Midwives Alliance of North America and National Association of Certified Professional Midwives. It’s important to have a support group of other midwives to ensure the best quality care for every client. They can also provide a wealth of information and resources to ensure the startup process goes smoothly.
- Conduct interviews with expecting families before taking them on as a client. You’ll have an instrumental role in the event that will change their lives forever - understanding each other is key to a successful birth.
- Consider accreditation through the American Association of Birth Centers.
How and when to build a team
This will depend upon your personal preference. While not required, many midwives partner with a doula to assist with the birthing process. You’ll also want to consider hiring one or two additional midwives within the community to help your business grow. Since childbirth can come at any time and can last longer than 24 hours, it would also be beneficial to hire someone to take care of the clerical duties, so you’re not overwhelmed during those busy times. Just be sure the first person potential clients interact with is someone they can relate to. Most teenagers haven’t gone through this sensitive process and cannot begin to understand what expecting mothers are going through - find someone who will be sympathetic and can educate clients and prospects whenever necessary.
Whether you decide to hire employees or work solo, you’ll need the assistance of a reputable attorney. They can help ensure all your paperwork is in order and that you’ve purchased the necessary insurance to protect your business and your customers.