Two important considerations to grow your practice is making sure there is more cash coming into the business than going out and at the same time fine-tuning your patient experience to achieve sustainable growth.
Few people understand that a profitable healthcare clinic that tries to grow too fast can run out of cash even if its services are wildly successful. Achieving the right balance between cash flow, sustainability and growth is key.
Achieve Sustainability by Reducing Your Overheads
One way of making sure there is more cash coming in than going out is keeping an eye on costs. As a solo practitioner operating five days, or less per week, it can make little sense to hold a Deed of Lease on a space.
For example, that practitioner would need to lease a space big enough to have a treatment room and a waiting area, so a minimum of 11sqm + 10sqm = 22sqm.
A reasonable rate for a building close to the Wellington CBD is around $285sqm.
A lease cost of around $7,125 per year is expected. Then if we add to that a range of other expenses including:
Part-time receptionist – $30,000
Marketing – $5,000
Office furniture – $3,000
Cleaning – $1,750
Internet and phone – $1,500
Software subscriptions – $1,500
IT support – $1,500
Accountancy fees – $1,000
Light, heating & power – $900
Merchant fees – $300
We arrive at a total of $4,464 per month.
Let’s presume your revenue is $150 per hour and you have enough patients to fill at least 7 hours per day and 3 days per week.
Total revenue is $12,600 per month.
Then minus operating expenses like plant and equipment, less tax, GST and super… you get the picture. There’s precious little left to pay your rent or mortgage and to set aside some financial security.
And what about holidays, sick leave and when life throws you a curveball? Remember that lease you just signed?
You need to consider the personal liability that comes with signing a formal lease agreement. At a minimum, you are committed to paying that lease for a minimum of three years.
As you build your patient base your budget is always going to be tight though, right? That little voice in your head is saying, “That’s life, I’ll just work harder”.
And I hear you, “But I don’t need a receptionist, I can do that all myself”. That is certainly possible, however, pause a moment and ask yourself:
Do I want to grow my practice?
Where is my time best spent on achieving growth?
How do I achieve a sustainable business without giving up every minute of my life?
Wouldn’t it be great if you could rent a clinical room and pay only for what you need, while you scale your business, and eat a little cake too?
If you want to grow, consider the following two critical aspects:
a) your patient experience system, and
b) your time limitations, and the best return on where you spend your time.
Grow Your Practice by Fine-Tuning the Patient Experience
Most would understand the correlation between excellent service and practice growth. Where some may fall short, is a misconception that providing excellent service is free for the business owner. “It’s all in how you deal with patients”. It might go a little something like this…
“If I communicate with my patients in a nice, polite manner, treat them with professionalism, and provide a solution to their issue, then I have provided all the great service I need to grow my practice. And this will cost me very little, as I control these aspects personally within my consult”.
Although there is truth this accounts for a large part of the patient experience, it’s far from the complete package, and it’s certainly not the only ingredient for sustainable practice growth. Research shows that a great service and experience system within healthcare is made up of interrelated components such as:
Healthscape – This includes physical service facilities such as equipment, machinery, technology, signage, employee appearance and other man-made physical environments. I.e. Does it look nice, and do I want to continue being treated at this practice as a result?
Personnel – This dimension evaluates courtesy, competency, friendliness, caring attitude, politeness, mannerisms and staff appearance.
Practice image – This includes expertise, authority, honesty and ethics of practitioners and staff.
Trustworthiness – Deals with providing medical treatment and maintaining privacy and confidentiality (this includes practice management systems and privacy policies).
Clinical care processes – Assessing patient condition, instruction and advice received, and time spent examining the patient (negative patient experience may relate to a sense of a practitioner “rushing”).
Communication – Obtaining information, and general feelings about the interaction with staff. This may also include communications pre and post-appointment.
Relationships – Focuses on the relationship between patient and staff.
Administrative procedures – Touch-points along the patient’s journey that positively add to the patient’s experience. This can be aspects related to your website, bookings systems, and practice management systems as a whole.
To be able to provide a stand-out service that makes the difference between temporary growth (due to limitations set by the business owner), and sustained growth; and potentially competitive advantage (as research shows). It takes awareness of all service dimensions.
ClinicalSpaces can help you develop a ‘patient experience system’ that encompasses all the necessary dimensions. We have been lucky enough over the last 9 + years to have removed ourselves from tasks that others can do, so we can focus on designing effective patient experience systems that work.
Grow Your Practice by Understanding Your Time Limitations
I get it when you’re a business owner; especially a new business owner, you need to do as much as you possibly can to “get things going”. However, the dilemma for most small businesses is that owners seem to find it hard to know when to let go of tasks. Or simply don’t want to (we are a controlling bunch), and consequently fail to realise they have likely bound [practice growth] by their best intentions to help their business. Unfortunately, these business owners can find themselves feeling chaotic and not in control. Spinning too many plates and spreading themselves too thin for patients, staff, family and themselves.
If a practitioner truly believes in what they do and desires to grow their practice to help as many people as possible, then at some point, they will need help. This can be something like having reception services to welcome, onboard new patients, and facilitate payment transactions. Which then enables the practitioner to either help more patients, take a little more time with them, and/or work on developing the dimensions of their patient experience system.
ClinicalSpaces can help by not only reducing overheads but also by providing services to help with sustainable practice growth. Truly reducing costs while helping grow your business.
Do you want to know more? Feel free to contact us and book your ClinicalSpaces tour.