Testing Laboratory Business Plan
SBA's list of environmentally sensitive industries names testing laboratories and no medical or diagnostic laboratory code, and that line can decide where your environmental diligence starts before anyone looks at your equipment list. "54138 TESTING LABORATORIES & SERVICES" is in Appendix 6 of SOP 50 10 8.1. When commercial real estate is offered as security for a 7(a) or 504 loan, the lender compares the NAICS codes for "the Property’s current and known prior uses" with that list (units in a Multi-Unit Building excepted), and on a match the investigation "must begin with a Phase I, regardless of the amount of the loan". A clinical lab's own use is not a match, though an earlier use of the building can be.
Verify every requirement with the named agency and your lender before committing capital. Laboratory accreditation, waste handling and, for clinical testing, the federal certificate required by 42 U.S.C. 263a are separate regimes from the SBA rules described here. Equipment and fit-out costs are specific to your discipline and we have not surveyed them.
Which laboratory are you?
This is the first question to settle, because the two answers can lead to different environmental processes on the same loan.
SOP 50 10 8.1 carries Appendix 6: NAICS Codes of Environmentally Sensitive Industries. It names:
54138 TESTING LABORATORIES & SERVICES
The Census Bureau's 2022 NAICS definition of that industry is establishments "primarily engaged in performing physical, chemical, and other analytical testing services", and its index puts environmental, food, soil, geotechnical, calibration and product testing laboratories there.
What Appendix 6 does not contain is any medical or diagnostic laboratory code. Its only entry in NAICS Sector 62, Health Care and Social Assistance, is "6221 GENERAL MEDICAL & SURGICAL HOSPITALS (if fuel tanks are present)", which is a hospital provision and conditional at that. A clinical diagnostic lab running patient samples is a different NAICS family, group 6215, and does not appear: the testing definition itself covers "biological testing (except medical and veterinary)".
The SOP is also precise about how widely a code reaches: "A 5 digit NAICS code includes all industries beginning with those 5 digits." So 54138 pulls in everything beneath it, but it does not reach sideways into healthcare. Other kinds of laboratory are inside the list: "812921 PHOTOFINISHING LABORATORIES (except one hour)" is named, and under the matching rule for 3 digit codes dental laboratories, which the Census Bureau classifies in manufacturing (339116), fall within "339 MISCELLANEOUS MANUFACTURING (only required if hazardous materials are involved)". Veterinary testing laboratories are indexed to 541940 and research and development laboratories to group 5417; neither code is on the list.
Practical consequence. The list is applied to the real estate, not only to you. Under Section A, Chapter 5, Paragraph E, where commercial Property is offered as security, a leasehold deed of trust included, the lender compares the NAICS codes for the Property's current and known prior uses with Appendix 6; a unit in a Multi-Unit Building (non-industrial, four or more units) is excepted from that step. So if a testing lab is, or was, a use of the property, plan for a Phase I. We found nothing in the SOP's environmental text on a use that has not yet begun. The nearest words are in the Appendix 6 footnote on fuel, which refers to "the NAICS code for the business", so a start-up should ask its lender how it will code the property.
What being in scope costs
A match takes away the questionnaire as a starting point. With no match, "If the loan amount is up to and including $250,000, the Environmental Investigation may begin with an Environmental Questionnaire." Above that amount it "must, at a minimum, begin with an Environmental Questionnaire and Records Search with Risk Assessment". Appendix 4 says a questionnaire "must be completed or reviewed by a Lender". With a match to an "environmentally sensitive industry identified in Appendix 6", the investigation "must begin with a Phase I, regardless of the amount of the loan", and Appendix 4 defines a Phase I ESA as one "conducted by an Environmental Professional in accordance with the most recently adopted standard for a Phase I ESA established by ASTM International, currently ASTM E1527-21".
And a Phase I is a starting point rather than a clearance. If the Environmental Professional "concludes that further investigation is warranted (typically a Phase II), and the SBA Lender still wants to make the loan, the SBA Lender must proceed as recommended by the Environmental Professional", or seek an exception to policy from SBA.
For a laboratory the question is not only what you will do. It is what the building has done. Because known prior uses count, a lab taking over former industrial or light manufacturing space can meet a Phase I on an earlier occupant's account: many manufacturing codes are on the list. Ask what the property was before you sign, and see our SBA environmental requirements guide for all 55 entries.
Is a testing laboratory profitable?
We have not surveyed laboratory revenues, margins or build costs, and will not publish figures we have not measured. What a plan can show is the timing of your cash flow, and it should answer two questions.
How does work reach you? If it arrives on a customer's schedule or under a contract, show the schedule or the contract. If it arrives order by order, show how each order is won.
Do your customers require accredited results? If they do, the period between being equipped and being accredited brings cost and no revenue from those customers, and it has to be funded. Model that gap explicitly and in months.
What drives the capital requirement
We have not surveyed these costs. These are the lines to price for your own discipline, each from a quotation or a published requirement:
- Discipline, before anything else. Price the instruments and fit-out for the tests you will sell.
- Instrumentation, which is lumpy. An instrument is bought whole, so one purchase can move the total.
- Building services. If your instruments or methods specify ventilation, power or water conditions, price them from the manufacturers' site requirements and a contractor's quotation.
- Accreditation, if your customers or regulators require it. Take the steps and fees from your scheme's published requirements, and cost the staff time they take.
- Analysts. If your scheme assesses staff competence, those staff are on the payroll before you are accredited.
- For a clinical laboratory, the federal certificate. Under 42 U.S.C. 263a(f)(1) the standards must require each laboratory holding one "to qualify under a proficiency testing program" and to use only personnel who meet the qualifications established under it. Under subsection (d)(2)(C), subsection (f) does not apply to a laboratory with a certificate of waiver.
How do you fund a testing laboratory?
On a 7(a) loan, if the business is new, the SOP's start-up test applies, and it is about the business rather than the operator:
SBA considers a business to be a “start-up” for the purpose of determining equity injection requirements if it has been in operation (i.e., generating revenue from intended operations) for 1 year or less.
On a Standard 7(a) or 7(a) Small loan (Section B, Chapters 1 and 2) a start-up needs an equity injection of at least 10 percent of total project costs, defined as "all costs required to become operational, regardless of the source of funds, except for lines of credit and 504 loans". On our reading, where a laboratory cannot operate without accreditation that base includes the cost of getting it, and an instrument financed by another lender, other than on a line of credit or a 504 loan, still counts. On an SBA Express loan (Chapter 2), whether to require an equity injection is "left to the business judgment of the Lender". Your own record counts elsewhere: on a Standard 7(a) loan (Chapter 1) the Lender or SBA must decide whether the equity is acceptable on factors related to "the type of business, experience of management, and the level of competition in the market area". Our SBA equity injection requirements guide covers what counts as equity.
A 504 loan uses a different test. A New Business there is one "in operation for 2 years or less at the time the loan is approved" (Appendix 3), and under Section C, Chapter 1 it must contribute at least 15 percent of the Project cost, against a 10 percent minimum otherwise. Under the same definition an existing business that starts another in the same 3-digit NAICS code with identical ownership, as Co-Borrowers, is "a business expansion and not a new business". The definition adds that "Operations are deemed to begin when the business begins generating revenue from its intended operations", so months spent equipped but not yet earning do not count toward the 2 years. And a business older than that "may be considered a New Business if it is a change of ownership that will result in new, unproven ownership/management and increased debt unrelated to business operations", which matters if you are buying an established laboratory.
On a 504 loan, a Limited or Special Purpose Property also means a borrower contribution of at least 15 percent, or 20 for a New Business (Section C, Chapter 1). Appendix 3 defines it as a "limited-market property with a unique physical design, special construction materials, or a layout that restricts its utility to the use for which it was built". Testing laboratories are not among the examples listed in Section C, Chapter 1, but that list "is not intended to be all-inclusive", it includes "Hospitals, surgery centers, urgent care centers, and other health or medical facilities", and the CDC must "address whether the Project Property is Limited or Special Purpose in their credit memorandum and include an explanation of their conclusion". So a heavily specified or clinical lab building is worth raising rather than assuming. Our free SBA equity requirement calculator shows what each answer costs.
What must your laboratory business plan contain?
- Your NAICS position and the property's use history, stated deliberately. Whether a 54138 use is among the current and known prior uses of real estate offered as security changes where the environmental investigation starts, so do not leave it to be found.
- The accreditation timeline, in months, with the cash to cover it, where your customers or regulators require accreditation.
- Named customer types and how work actually arrives: on a schedule, under a contract or order by order. Where revenue is contractual, the plan should show the contracts.
- Instrument list with utilization assumptions. Idle capacity on an expensive instrument is cost without revenue.
- Waste streams and disposal arrangements, named.
- A project cost schedule covering all costs required to become operational, with the equity injection identified and its source documented.
We write SBA business plans and financial models for exactly this kind of filing, including the project cost build-up and the monthly cash flow projections with their assumptions. Fees are fixed and published, and we never charge a percentage of anything you borrow or raise.
Frequently asked questions
Does a testing laboratory need a Phase I environmental assessment?
Under SOP 50 10 8.1, when commercial real estate is offered as security for a 7(a) or 504 loan and a testing laboratory (NAICS 54138) is a current or known prior use of it, the environmental investigation must begin with a Phase I, regardless of the loan amount. Units in a Multi-Unit Building are excepted.
Does the same apply to a medical or diagnostic laboratory?
Not by its own use. Appendix 6 of SOP 50 10 8.1 lists no medical or diagnostic laboratory code; its only entry in the health care sector (NAICS Sector 62) is general medical and surgical hospitals with fuel tanks. But the lender also compares the property's known prior uses, so an earlier occupant of a clinical lab's building can still lead to a Phase I.
Is a laboratory a special purpose property for SBA?
Testing laboratories are not among the 504 examples of Limited or Special Purpose Property in SOP 50 10 8.1, Section C, Chapter 1. That list is not all-inclusive and includes hospitals and other health or medical facilities, and the CDC must address the question. On a 504 loan, classification means a borrower contribution of at least 15 percent, or 20 for a New Business.
What funding gap should a new laboratory plan for?
The gap between equipped and accredited, where customers require accredited results. On a Standard 7(a) or 7(a) Small loan under SOP 50 10 8.1, a start-up needs an equity injection of at least 10 percent of "all costs required to become operational, regardless of the source of funds, except for lines of credit and 504 loans". On our reading that includes accreditation a laboratory cannot operate without.
Am I a start-up if I have run laboratories for years?
On a 7(a) loan, yes, if the borrowing business has been generating revenue from its intended operations for 1 year or less: the start-up definition in SOP 50 10 8.1 tests the age of the business, not its owner's experience. A 504 loan tests for a New Business, in operation for 2 years or less at approval, which contributes at least 15 percent.
This page summarizes what SBA SOP 50 10 8.1 (effective 1 October 2026), the Census Bureau's 2022 NAICS definitions and index and 42 U.S.C. 263a say, as retrieved on 10 October 2026. It is general information, not lending, legal, environmental or accreditation advice, and it is not a commitment to lend. The SBA lender determines the NAICS codes for a property's uses, and accreditation requirements differ by discipline and scheme. Confirm every requirement with the relevant bodies and your lender before you commit capital.