16.5 The Self-Employment Process

The DVR Counselor shall fully inform the individual interested in self-employment of the role of DVR and the self-employment process by reviewing all relevant documents describing the guidelines of the self-employment program, funding tiers, and completing the entrepreneurial profile, checklist, and questionnaire. These documents shall be used to explore whether a self-employment outcome aligns with the individual’s strengths, resources, concerns, priorities, abilities, capabilities, interests, and informed choice, as well as whether the initial business concept warrants further development. This information shall also be considered by the counselor, individual, and RCE to determine if transferring the individual’s case to the RCE is appropriate.

If self-employment is not determined to be viable due to either the nature of the business concept or lack of alignment with the individual’s strengths, resources, concerns, priorities, abilities, capabilities, interests, and informed choice, the counselor will resume comprehensive assessment activities with the individual to determine an alternative employment outcome.

Individuals continuing with further exploration of a self-employment outcome shall work with the counselor or Rehabilitation Counselor for Entrepreneurship (RCE) to complete the comprehensive assessment. Comprehensive assessment activities for an eligible individual desiring self-employment as an employment outcome include technical assistance and other consultation services to conduct market analyses and develop the business plan. A feasibility study and other entrepreneurial assessments may be utilized to support the documentation of the individualized analysis of the comprehensive assessment. All support and assistance necessary to develop a business plan shall be outlined in a Business Exploration Agreement (BEA), including concurrent services such as physical or mental restoration, short-term training, or other supportive services required for the individual to develop a business plan. The BEA shall identify necessary services, service providers, funding sources, timeframes for completion of each service, and responsibilities of both the individual and DVR. The BEA shall address how progress will be monitored toward the completion of the BEA. Insufficient progress toward the completion of services outlined in the BEA may result in further review or possible termination of the BEA.

The business plan describes the proposed or existing business venture and is the blueprint of the business concept itself. The business plan is developed after thorough research of the industry, market, product, financial situation, and overall proposed organization and provides an organized system for researching business concept feasibility. A written business plan shall be developed for all self-employment outcomes. The size and scope of the plan is determined by the RCE and is relative to the business type and other individual factors.

For a Tier 1 business, a one-page business plan is sufficient and must include:

● Brief business description

● Estimated start-up costs

● Known competitors within the market

● Anticipated customers

● Marketing plan

● Brief financial/revenue forecast

A reduced-scope business plan is necessary for a business funded at the Tier 2 level. A reduced-scope business plan is considered for occupations such as real estate agents, as the connection to a parent company reduces start-up costs and complexity. A reduced-scope business plan must include:

● Business Feasibility Worksheet

● Self-Employment Questionnaire

● Business operations start-up

● Financial projections (three years)

● Estimated start-up costs

A comprehensive business plan is required for any business funded at the Tier 3 level. A comprehensive business plan must include:

● Executive summary

● Business description

● Competitive survey

● Market survey

● Customer survey

● Marketing plan

● Operations plan (includes legal, insurance, taxes, inventory, zoning, licensing, production expenses, and pricing strategy, etc.)

● Estimated start-up costs

● Financial projections (three years)

● Back-up plans

● Accounting procedures

As necessary, DVR shall provide or direct individuals pursuing self-employment to resources that provide technical assistance and other consultation services to conduct market analyses and develop business plans.

Fields in which it is the industry standard to hire independent or subcontractors may be considered for a self-employment outcome, including many positions within the “gig economy” (e.g., Uber, Lyft, wag.com, etc.). Positions of this nature result in earnings reported through a 1099 Form rather than a W-2. These positions often require an abbreviated self-employment process due to limited risk and start-up requirements. Other independent or subcontract work, including real estate agents, cosmetologists, estheticians, lawn care, etc., requires a more comprehensive approach to self-employment. Counselors considering supporting an Individualized Plan for Employment (IPE) to pursue such employment shall consult with an RCE to determine the documentation required and whether the employment outcome is appropriately served through the self-employment program.

Any business operating for less than 12 months, shall be considered a new business for purposes of the self-employment program. When an individual has an established business that has been in operation for at least 12 months and is seeking DVR support to address disability-related barriers impacting the business’ stability or growth, the counselor shall consult with an RCE to determine the best course of action for the success of the individual regardless of the nature of supports requested. The individual shall provide documentation to allow the RCE to evaluate the current performance of the business, including profit and loss statements for the past 12 months and all Schedule C tax forms for up to three years. Based on this information and consultation with the individual, the RCE will advise the counselor of the ongoing viability of the business and determine whether transfer of the individual’s case to the self-employment program is warranted.

Self-employment services are not available to solely support the expansion of a currently successful business. Self-employment services may be considered when the current stability or performance of the business is limited due to disability-related barriers that may be addressed by the self-employment program.

Individuals operating farms or ranches may be considered for self-employment. Because farms and ranches often have no net profit and earnings are generally put back into ongoing business operations, the counselor shall consult with an RCE for guidance in completing the Financial Need Analysis and criteria for monitoring progress toward case closure.

Each business plan shall be reviewed at the appropriate review level to determine if all of the components have been addressed and evaluate the continued feasibility of the business. Minimum criteria to be considered include:

● The business’ potential profitability as reflected in the business plan’s financial forecast.

● Start-up costs.

● Availability of financial resources.

● The individual’s ability to effectively manage the business as it is designed.