When the Going Gets Tough; The Tough Get Marketing

When the Going Gets Tough; The Tough Get Marketing

When it comes to fears of reduced revenues, marketing and advertising expenses are the first to get dropped. So when revenue drops take the contrarian approach and put more effort into marketing. In the past it may have taken 3 units of effort to create a sale or find a new patient. In today’s economy it might take more like 7 units of effort. The keys are finding what works and how to develop those techniques. Here are a few boulder- size rocks that will give you a jump start to getting back your revenues.

1) Pipelining: Every day or week devote a specific amount of time to long term client building.
a) Examples:
i) Send 10-20 letters of introduction per week to referral sources.
ii) Send 10-20 letters per week to area HR managers, small business owners
iii) Drop off your card to 10 people you meet each week. (hint: Create a Glossy
business card that offers an introductory gift or offer. You can get color business
size cards )
iv) Now have your staff do the same every week

2) Network and Join a group: Either yourself or one of your more outgoing staff members
should join a group. Business networking groups are excellent. Become active
a) Chamber of commerce
b) Local business owners group
c) Any local social group you like

3) Host a monthly event at your office. Do this on a regular basis
a) Find a local artist to display their work and do a wine and cheese reception
b) Host a scrapbooking club meeting, wine tasting, book reading. Really anything that is
of interest.

4) Send out a monthly email or newsletter that provides useful info to patients, plus some new services or products in your office-even a special offer. Send 500 - 1,000 letters per month. Each letter with postage should run about 50 cents a piece.

a) Hint: Year-end flex plans are running out. Include a note in your recall cards informing patients know they can use their flex accounts for eyewear needs before they lose their spending accounts .

5) Cross market with other local retail shops including hair salons, spas, restaurants, etc. Offer to give them a “VIP” special discount card they can present to their clients.

6) Cable or radio advertising. Costs have come down dramatically and both of these mediums offer a great opportunity to reach your target audience “patients”. Combine this with a cross marketing promotion with a nearby retailer and share the costs. While this form of advertising may seem a bit pricey – Check it out first and see. Ask for terms on payments. Just remember to have a clean ad that includes specific features and benefits about you and even a promotionally offer. Or just promote a specific product or service. Also check with your suppliers. They may help in contributing with the costs of advertising.

Have you had a business health checkup lately?

Have you had a business health checkup lately?

Best Practices in Financial Planning

Whether you are considering selling your office now or not – today is a great day for a practice health checkup. Financial planning and wealth building strategies start with a good foundation of regular up to date business financial record keeping.

Imagine driving somewhere without a road map or an address for your destination. Mapquest software driving directions require a starting address and ending address. Additional options let you select the fastest route, shortest distance or avoidance of highways. Now picture your business in the same way (i.e. financials, revenue and profit). How did you start? Where are you now? What products or services do you want to keep, add or avoid? And of course when do you want to finish?

Do you have P&L’s prepared every month? Do you know what P&L’s are? Do you have easy access to all revenue and expenses? Can you compare your performance with prior years? In today’s economy it is more important than ever to maintain good, up to date financial records and statistics on your office. This will improve your bottom line profits, reduce stress, make it easier to get loans and ultimately help sell your office faster when you are ready. (Every owner should treat their business as if they are always prepared and ready to sell.)

Typically, things like financials are put to the bottom of the priority list – only to be raised at the last minute when taxes are finally due. Imagine having monthly reports that allow you compare years month by month. If you had comparative reports you might find out that the month you thought was so bad was actually better than the same month last year.

The perception of patient loads might be down. If you had financial reports you might discover fewer patients with the same total revenue. Did you ever wonder which months are your best? Which months are the slowest? Only through up to date reports can you determine your financial performance and how to fix any problems before they get enormous.

Regardless of whether you are selling your office today, these are important habits to keep especially in today’s economic environment. For example, you may need a loan for working capital or new equipment. Banks today will require a current profit and loss statement that is not more than 2 months old. If your projected revenue for the year is down based on the current interim profit and loss statement it could be more difficult to get a loan. However, if your prior year’s same period figures show a similar trend (i.e. your better months may be seasonal)--the bank would certainly reconsider your loan.

Many owners rely on themselves to prepare the financials. A better solution is to hire a part time bookkeeper to maintain record. Would you pay a doctor’s wage to someone else to do accounting? How much is your time worth? If you have so much time why not see more patients? As a doctor you earn much more per hour then a bookkeeper. The cost is well worth it and delegating the job allows you to focus on the big picture.

Healthy habits will result in better business performance, improved profit and ultimately a higher value when you sell your office.

There are three keys in determining your financial plan:

(1) First determine where you were;

(2) then where you are today;

(3) finally determine where you want to go…

Before you can formalize your financial plans step 1 must be done and then step 2 must be maintained EVERY MONTH.

The following basic items should be recorded and maintained for at least 3 years:

1. 3 years business tax returns
2. 3 years profit and loss statements with detail breakdown of major expenses
3. Year end W-2 statements including separation of any owner wages (3 years)
4. Bank statements (3 years)
5. Monthly revenue and expenses for every month (3 years) (separately)
6. Patient numbers by month and by year. (3 years) (separate new and existing patients)
7. Current year-to-date profit and loss statement
8. P&L for the last month
9. Monthly physical inventory cost
10. Monthly patient count (new and existing)
11. Accounts payable list
12. Accounts Receivable list
13. Monthly wages by staff
14. Monthly revenue grouped by the specific service, billing code or product.
    

These items are part of the step 1 process. Step 2 involves maintaining this on a current monthly basis (items #7 -14)
A few simple steps to remember.

1. Get a part time bookkeeper.
2. Use Quickbooks or another software program to record your financials
3. Finish the profit and loss statements for the prior month by the 15th of each month.
4. Separate financial information for each office
5. Keep each month in a binder labeled by year.
6. Keep bank statements accessible and organized.
7. Keep vendor invoices organized by month and easily accessible
8. Keep employee payroll information organized and easily accessible
9. Keep revenue and expense information current for each day and month. (Daily reports)
10. Use a practice management software system to record every day’s revenue activity.
    
    

Commit yourself to these healthy habits every month. With the information at hand from steps 1 and two it is easy to move to step 3 and compile a financial plan.

Moving forward to step 3 includes the following:

1. How long do I want to practice? First determine your timeline (exit strategy or when do you want to retire or sell the practice)
   
2. What do I want short term and long term? Determine the long and short term specific objectives (from a profit standpoint)
   
3. What are some ideas to get what I want. Write down 10 ideas to reach these goals.
   What’s my action list?Take each ideas and write down specific step by step actions to take to implement each one.
   
4. How much should I set aside from profit for business improvement? Allocate a percentage of profit for re-investment in the business and capital improvements.
   
5. GPS..Where am I?
   Measure your progress on a monthly basis (See steps 1 and 2)
   
6. Am I off course?
   Review the measurements monthly and determine if changes need to take place.

The best method for implementing and following through with these steps is to include the entire staff. Delegate as much as possible. Each person should understand their duties and measurements of performance. While it may seem like an enormous amount of work – once the systems are in place and the information is automatic (at your fingertips) running and growing your practice will seem like a piece of cake. Increased profits and equity will of course be your dessert.