How to Relieve Financial Stress In Your Practice
By Eric Huntington, DC
The recent changes in consumer attitudes on spending, as well as a tighter credit market have created a much less forgiving practice environment.
However, the basic rules of practice and business success have, by and large, not changed at all. It only appears to have changed because there is now less of a margin for error.
Those who violated, and continue to violate certain basics of business are now finding it hard to survive. The good news is that the way to fix the problem does not have to be a mystery.
For the purpose of this article, I will not distinguish between promotion and marketing - two subjects which can have very different objectives.
A Valuable Skill
Knowing how to relieve the immediate financial stress on a practice can be a valuable skill for any practice owner. While a thorough review of all the components of an existing practice would need to be performed to determine the exact (correct) actions to take in order to bring a practice back up into an optimal position, there are certain basic ideas that apply in most situations.
Don't Cut Promotions and Marketing
The proper thing to do when you are experiencing a downturn in your income or practice volume is to put your available resources into promotion and marketing.
This can be accomplished through various actions both inside and outside your office. This could include money or time or your attention - and in most cases, would include all three.
The knee-jerk reaction of an unskilled executive is to immediately cut expenses. Worse than that, the first expenses usually cut are in the areas of promotion and marketing.
This, of course, further contracts the practice, making the situation even worse. So, the first action to take at the first sign of a downturn is to promote!
Promotion could include obvious things like advertisements, health fairs, handing out business cards, making personal contacts with local professionals, networking meetings, asking for referrals from your patients and the assortment of marketing ideas available to you.
However, it also includes the lesser thought of actions such as improving the staff dress code of your clinic, being sure that your receptionist is giving a warm greeting and smile to everyone that comes in the door, or sending thank you cards for referrals and birthday cards and every other action, which could improve the image of your clinic in the eyes of the public.
Invest In What You Know
It is absolutely prudent to keep a close eye on the success of your promotion and marketing to determine your return on investment (ROI).
The best scenario is to invest in actions which have been successful in the past.
Occasionally, new actions need to be tried, and these should be monitored closely. If you find that an action does not make you money, don't stop promoting all together, simply shift those resources into what is working for you.
And, if you're not sure what is working, or what could work, you need to find that answer very fast and then invest your resources in it immediately.
The Expense Side
Another successful action can be to cut all unnecessary expenses.
But be very thoughtful in determining which expenses are unnecessary.
Most expenses in a practice are completely necessary, even if they do not, at first, appear to be so. This could include money that was being spent on extras that didn't really produce more income, or it also could include shifting hours of personnel from less productive tasks to more proven and productive tasks.
The key is to make the best use of your resources for the purpose of expanding the practice.