State Regulations Restrict Certain Businesses From Expanding

Nearly every entrepreneur starts their small business with the ambition to expand. However, state regulations can create a big obstacle to scaling up. Certain states have different requirements and regulations for the type of businesses you can operate and practice.

Melissa Bercier, founder and president of Couch Clarity, learned this lesson firsthand as she sought to expand her Illinois-based psychotherapy practice

“My goal is to de-stigmatize mental health enrichment and create a more positive and healthy community for all,” Bercier said. “And I would love to do that nationally.”

However, a roadblock to Bercier’s success is state regulations. Because each state has its own laws governing social work licensing and what practices and activities that entails, social workers must be licensed in each state they practice in. With Bercier’s counselors only being licensed in Illinois, this restricts Couch Clarity’s growth beyond the state borders.

The lack of license portability and practice mobility is an issue that restrains many businesses and limits their growth walking finding where they can expand to. It's a factor that many small businesses should consider when starting out — no matter how far away they are from their goals of expansion.

Even in a Recession, Loosening State Regulation Isn’t a Priority

During the current recession from the coronavirus pandemic, many small businesses are advocating for loosening state regulations and barriers in order to boost sales and promote growth. While some states have loosened their restrictions, this was done more out of making services accessible during the pandemic rather than promoting the growth of small businesses.

A major reason this is such a challenge is that it is difficult to find common ground for different states. The regulations in some states are different than others because they serve the specific needs of each state’s economies, demographics, and politics.

Bercier’s goal to destigmatize mental health nationally and expand her business has been stifled by these regulations. One of the first steps to loosening these regulations is getting reciprocity for bordering states.

“Licensing for social workers is very specific to each state, which presents one of the major challenges for our growth,” Bercier said. “For therapists and specifically social workers, each state has its own laws that govern social work licensing, and they define the activities that social workers are allowed to perform.”

States have perfectly sound and legal reasons as to why they have their own regulations that protect their citizens. Nonetheless, every entrepreneur should know the regulations within their own state and the limitations they may face if looking to expand to others.