11 TIPS FOR BUILDING A SPECIALTY PRACTICE
Find the best location available
If you are planning on having referrals from different areas of your city, make sure you are located somewhere where patients can easily find you. If you think most of your referrals or patient base will come from an afluent area, be sure to seek a location in that area.
If you think you will be getting patients from other states or even out of the country, make sure your clinic is easily accessible from the airport and freeway. Also, make sure there is plenty of parking and easy access. Even something as simple as having access on only one street can majorly affect the patient perspective. For instance, if your patients are having to make a U-turn to get into your office, that can be detrimental to any business.
Also, feel out the building – is it old and run down? If so, patients may not perceive your clinic as a premium option. Try to find a property manager who will help cover costs for your build out. Negotiate free rent for the first few months while your business gets off the ground.
If you don’t have money saved up for your new clinic, you’ll want to secure funding as soon as possible so you know how much money you can spend and how much you need for reserves.
Most local banks find optometry clinics very safe businesses, so it should not be very difficult to obtain funding for a small business loan or equipment loan. You will want to obtain prices with a few banks to compare offers.
Compare interest rates and total loan amount offered. For instance, one bank may give you $100,000 for 3% interest, while another bank will give you $250,000 for 5% interest. If you need more capital to start your practice, it might be best to take the higher total loan amount, despite the higher interest rate.
Find deals such as very low or no interest on equipment whenever possible (some companies offer low interest or no interest on certain pieces of equipment and others have deals toward the end of the year). Some doctors will opt for a small business loan with their bank, while choosing a different company to finance equipment.
Create a List of Must Have Items Versus Would be Nice
You’ll want to create a list of wants versus needs for your new clinic. If you are developing a specialty contact lens clinic, what are the MUST haves? If you are developing a dry eye clinic, what instruments and products are essential to your success? If you are developing a vision therapy clinic, what equipment is needed? Contact your local equipment company (or companies) and give them your 2 lists. Then, they can give you a quote on all of the requested items and you can determine what is worth spending the extra money.
For instance, one of my “would be nice” items was a retinal imaging system. Due to the cost and the focus of my clinic, I decided to forgo that piece of equipment once I saw the price.
Start the Credentialing Process Early
If you are planning on taking insurance, it can take months to get credentialed. Start the process as soon as you are able. If you are trying to save money and you have a lot of time on your hands, start filling out and submitting applications right away.
There are credentialing services who can complete the applications for you and can be a tremendous amount of help. If I was going to accept insurance, I would have hired one of these companies right away to help with the process.
Talk to Local Doctors to Determine the Need for your Specialty
The reason I chose Las Vegas as an area to open a specialty lens clinic is because I found out no other optometrist in Nevada had a clinic that was purely focused on specialty contact lenses. I also called a few local optometrists in the area to find out if there would be a need for my specialty. After doing research, I determined Las Vegas would be an excellent location to oer specialty contact lenses.
Get Advice from Other Doctors from whom you Want to Model your Clinic
I reached out to many different optometrists who had specialty contact lens clinics that I admired. I spoke with them on the phone and by email to gather some ideas on how they started their business and any tips they had for me. After collecting advice from many different optometrists, I was able to organize my thoughts and figure out what system would work best for me.
Get Advice from Other Specialty Clinics
Even though my specialty is contact lenses, one of the best resources was from a local vision therapy doctor. She owns a vision therapy clinic and does not have an optical and does not practice primary care. She depends on referrals from other optometrists and she doesn’t accept insurance. Those were key areas that I felt I could learn a lot from her. She was incredibly helpful, supportive, and her knowledge was invaluable to me.
Be Financially Responsible
It is an exciting venture building and creating your custom practice. I’ve taken a lot of risks but I’ve also been financially responsible at the same time. What do I mean by that? It is ok to take out a loan for your new business but it is not ok to spend the entire amount loaned to you just for equipment.
You need to have a list of expenses before you start down this road. List out all of the things you’ll need to spend money on, such as equipment, build out (if applicable), furniture, supplies, utility costs, etc. After you figure out approximately how much you need, add about 20-30% extra to account for additional cash in the bank for unforeseen expenses (trust me, not matter how well you plan and budget, there are always things that come up). This will also allow a small cushion in case your business does not take o as fast as you expected (can anyone say Coronavirus?).
Having extra money in the bank will help you sleep better at night.
Operate a Lean Business and Lean Life
To minimize your expenses, don’t create unnecessary overhead. Minimize your employees. Do the things you don’t want to do. I’ve never had to answer the phone and make appointments, but guess what I am doing right now? Yup, I am answering all the phones, making appointments, and taking care of the patient from the time they check in until they check out. I am with the patient every step of the way right now. Until I get busier and cannot function without another person, I will continue to operate this way.
Plan on a lean life for a while too. Maybe don’t buy a house or a new car the first year. Maybe limit your vacations or nights out for a while. One of the main reasons I am not stressed when unexpected situations arise, is because I have prepared. Try and build up at least 3 months’ worth of expenses before you start spending money on yourself. Many doctors get what Dave Ramsey calls “doctoritis,” where doctors feel they need to maintain a certain image and spend money on certain things. Do not get enveloped in this mindset! This can create financial trouble and uncertainty.
Direct your Optimism Toward Growing the Company
It’s easy to be excited about this new practice and think that you’ve accounted for every detail. You’ll start to feel very optimistic. While it is important to be excited and optimistic about this new opportunity, try to remove this emotion when you are making business decisions.
Don’t expect to crush it and change your lifestyle in the first year – be conservative so that in case things do not go the way you planned, you’ve prepared for it. Be modest in your projections. I estimated seeing one patient for the first month, and two for the second month. When I saw more than that, it allowed me to put extra money towards my 3 months’ savings.
It’s easy to think “this clinic is going to be the greatest and I have no competition and everyone is going to refer to me.” The truth is, you are going to have to prove yourself to patients and doctors, and it will take time to develop that trust.
Do Things the Way You Want to
After speaking with some of the key leaders in the industry, I received conflicting advice. For instance, one optometrist told me to buy everything used because it will help save up front costs in the beginning, while another optometrist told me to purchase new because it had a warranty. I ended up purchasing some used equipment (will anyone really notice my refurbished phoropter? Probably not) and some new equipment (the exam chair needed to look brand new to maintain my look and feel of a premium clinic).
It is very important to create the clinic that YOU have dreamt of. This is YOUR dream and if you develop a clinic that operates the way you want it to, you will work hard to ensure its success. I have created a clinic in which I can take care of patients at the highest level, and I will continue to work hard to see my clinic flourish.