Blood tests, urine tests, diabetes and thyroid checks, health packages and diagnostic tests are part of everyday healthcare in India, and demand keeps rising with preventive health, chronic diseases and insurance coverage. Diagnostic labs and sample collection centres range from a small collection point in a neighbourhood to a full pathology laboratory serving doctors, hospitals and patients across a city.
Because test results guide medical decisions, labs are regulated, and quality is everything. This guide explains how to start a lab or collection centre and run it responsibly.
Key points
Table of Contents
- Labs and collection centres must register as clinical establishments in states that have adopted the Clinical Establishments Act or have their own laws.
- Qualified staff are essential: reports should be signed by a qualified pathologist or other appropriately qualified medical professional, and tests run by trained laboratory technicians.
- NABL accreditation is voluntary but highly valued, and is often required for empanelment with insurers, hospitals and government schemes.
- Biomedical waste must be handled under the Biomedical Waste Management Rules, with authorisation from the State Pollution Control Board.
- Health care services by clinical establishments are generally exempt from GST.
The market in numbers
Diagnostic labs fall under what MoSPI’s surveys call health and social work. In 2023-24 this group had about 12.8 lakh small establishments, with average value added of ₹8,87,384 a year in urban areas, one of the highest of any small business group. Businesses with hired workers added ₹13,87,950 on average, against ₹1,94,768 for one-person establishments.
Step 1: Choose your model
- Sample collection centre: collects samples from patients and sends them to a partner lab for testing. Lower investment; often a franchise of a larger lab chain.
- Basic pathology lab: runs common tests such as haematology, biochemistry and urine analysis in-house, and sends specialised tests to reference labs.
- Full diagnostic lab: a wider test menu, with more equipment, staff and quality systems.
- Home collection service: phlebotomists collect samples from patients’ homes for a lab.
Step 2: Registration and licences
- Clinical establishment registration: many states have adopted the Clinical Establishments (Registration and Regulation) Act, 2010, while others have their own laws for private health establishments. Register with your district or state health authority, meeting the minimum standards for premises, staff and equipment for your type of lab.
- Biomedical waste authorisation from the State Pollution Control Board.
- Shops and establishments registration and a trade licence where required.
- Fire safety and electrical safety for your premises.
- Udyam registration: free, and useful for equipment loans. See our Udyam guide.
- Radiology: X-ray and imaging services need separate approvals from the Atomic Energy Regulatory Board, and ultrasound is regulated under the PCPNDT Act. This guide focuses on pathology.
Step 3: Qualified staff
- Pathologist: reports should be signed by a qualified pathologist or other appropriately qualified medical professional, as the law and courts have emphasised. Many smaller labs engage a pathologist part-time or as a consultant.
- Laboratory technicians: with recognised qualifications (diploma or degree in medical laboratory technology).
- Phlebotomists: trained to collect samples safely and hygienically, especially for home collection.
- Front desk staff: for registration, billing and reports, with training in patient privacy.
Check the full cost of each employee with Advanton’s hiring cost calculator.
Step 4: Equipment and supplies
- analysers: haematology, biochemistry, immunoassay and urine analysers, chosen for your test volume
- centrifuges, microscopes, refrigerators and freezers for samples and reagents
- sample collection supplies: vacutainers, needles, tourniquets, swabs and transport boxes
- cold chain for sample transport
- laboratory information system (LIS) for registration, tracking, results and reports
- power backup and stable electricity
Many suppliers offer reagent rental arrangements, where you pay for reagents and get the analyser on lease, which reduces upfront costs.
Step 5: Quality control
Accurate results are the whole business:
- internal quality control every day for every analyser, with documented results
- external quality assessment through recognised programmes, comparing your results with other labs
- calibration and maintenance of equipment on schedule
- standard operating procedures for every test, from collection to reporting
- sample identification: correct labelling at every step to avoid mix-ups
- turnaround time tracking, so reports reach patients and doctors on time
NABL accreditation
The National Accreditation Board for Testing and Calibration Laboratories (NABL) accredits medical labs against international standards for quality and competence. Accreditation is voluntary, but it builds trust and is often needed for empanelment with insurers, corporate clients, hospitals and government health schemes. Smaller labs can start with NABL’s entry-level programmes and work towards full accreditation.
Step 6: Biomedical waste
Under the Biomedical Waste Management Rules, 2016, labs must:
- segregate waste at source into colour-coded bags and containers
- pre-treat certain laboratory waste as the rules require
- hand over waste to an authorised common biomedical waste treatment facility
- keep records, and file annual reports with the State Pollution Control Board
Train every staff member, and never mix biomedical waste with general waste.
Running a home collection service
Home collection is one of the fastest-growing parts of diagnostics. To run it well:
- train phlebotomists in safe collection, hygiene, patient comfort and handling of samples
- use the right supplies: labelled tubes, tourniquets, gloves, sharps containers and insulated sample boxes
- confirm appointments and fasting instructions the evening before
- label samples at the patient’s home, with the patient’s identity confirmed
- transport samples in cold boxes within the time each test allows
- track every sample from collection to report in your laboratory information system
- dispose of sharps and waste under biomedical waste rules
Joining a collection centre franchise: questions to ask
Many lab chains offer collection centre franchises. Before signing, ask:
- what investment, deposit and fit-out are required
- what share of each test’s price you’ll earn, and when you’re paid
- who provides equipment, supplies, software and training
- how samples are transported, and how quickly reports are delivered
- whether the chain’s lab is NABL-accredited
- whether your area is exclusive, and what targets apply
- what happens if you want to leave the franchise
Step 7: GST and pricing
Health care services provided by clinical establishments and authorised medical professionals are generally exempt from GST. Some related supplies, such as certain non-health services or goods sold separately, may be taxable. Get advice from a chartered accountant.
Pricing: publish clear prices for individual tests and health packages, and compare with local labs. Offer discounted packages for preventive check-ups, senior citizens and corporate employees. Accept UPI and card payments. See how to price your products and services.
Step 8: Patients’ privacy and trust
- keep test results confidential, and share them only with the patient or their authorised doctor
- deliver reports securely, by app, email or WhatsApp with care
- explain preparation instructions (such as fasting) clearly before tests
- handle patients kindly, especially children and the elderly
Step 9: Get patients and referrals
- Doctors and clinics: most tests are prescribed, so build relationships through quality and turnaround time, not inducements, which medical ethics prohibit.
- Home collection: convenient for the elderly, busy professionals and chronic patients.
- Corporate health check-ups for employers.
- Google Business Profile with tests, timings, home collection details and reviews.
- The India Business Directory: list your lab free.
Step 10: Grow
- Add collection centres in nearby areas.
- Expand your test menu as volumes grow.
- Get NABL accreditation to win institutional business.
- Empanel with insurers and health schemes.
- Funding: equipment loans, a Mudra Tarun loan, or a bank loan with CGTMSE cover. See business loans and government schemes.
A getting-started checklist
- Choose your model: a collection centre, a basic lab or a full lab.
- Check your state’s clinical establishment registration requirements.
- Engage a qualified pathologist, and hire trained technicians and phlebotomists.
- Find premises that meet the standards for your type of lab, with power backup.
- Arrange equipment, reagents and a laboratory information system.
- Get biomedical waste authorisation, and a contract with an authorised waste facility.
- Set up quality control, standard operating procedures and report formats.
- Register, then launch with home collection and doctor outreach.
Common mistakes
- Operating without registration or qualified staff.
- Unsigned or improperly signed reports.
- Weak quality control, leading to wrong results.
- Mishandling biomedical waste.
- Sample mix-ups from poor labelling.
Frequently asked questions
What tests should a new lab offer first?
Start with the most commonly prescribed tests in your area, such as blood counts, sugar, lipid, liver, kidney and thyroid tests, and send specialised tests to a reference lab.
How long does NABL accreditation take?
It depends on how ready your systems are. Labs typically spend months preparing quality systems, documentation and proficiency testing before assessment.
Can a collection centre run without a pathologist?
A collection centre that only collects samples and sends them to a lab still needs registration and trained staff, while reports are signed at the testing lab by its qualified professionals. Check your state’s rules.
Do I need a licence to open a pathology lab?
Register as a clinical establishment under your state’s law, get biomedical waste authorisation, and meet the minimum standards for staff, premises and equipment.
Who must sign lab reports?
Reports should be signed by a qualified pathologist or other appropriately qualified medical professional, as required by law and standards.
Is NABL accreditation mandatory?
No, it’s voluntary, but it’s widely valued and often required for empanelment with insurers, hospitals and government schemes.
Is GST charged on diagnostic tests?
Health care services by clinical establishments are generally exempt from GST.
Sources
- National Accreditation Board for Testing and Calibration Laboratories
- MoSPI, Annual Survey of Unincorporated Sector Enterprises 2023-24, full report
- Central Pollution Control Board
- Central Board of Indirect Taxes and Customs, GST
- Ministry of MSME, Udyam Registration portal
- Pradhan Mantri MUDRA Yojana
Last reviewed November 6, 2026. Startup costs are estimates; check local prices, licensing and tax rules before you commit money.
