Profits When Business is Good
BY GARY GERBER, OD
My monthly column often focuses on ways to boost profits, to increase the number of patients who say "Yes" when offered contact lenses and to enhance staff involvement in building your contact lens practice. This month, I'll assume you've done all this and write to you as though your practice is as profitable and efficient as it's ever been.
When our clients' practices are flush with cash, their owners' natural instincts are to take the extra revenue as personal income. I don't necessarily disagree with that and believe you should reward yourself for building your contact lens practice. However, if your long-term goal is to continually build your practice, then taking money out of it isn't always the best strategy especially when things are going well and especially if you're taking all of the profit for yourself.
Our experience shows that re-investing in your business when times are good is a great practice-building strategy. Resist the urge to cut back when you're on a roll and instead pump excess funds back into your practice.
The perfect time to spend instead of save is when things are going well. That's when you should take a hard look at that topographer you've been eyeing, add contact lens e-commerce capability to your Web site or expand your inventory. Another strategy is to build up a war chest so you can ultimately do all of those things.
Benefits of Saving Your Acorns
Most of our practices go through business cycles. For example, the dead of winter and summer can be slower than the spring and start of summer.
A way to even out business and reduce the sine waves in your bank account is to allocate your war chest funds for marketing efforts just before an anticipated slow down. For example, if you historically find December to be a slow month, then in mid-October you should plan and budget for a contact lens marketing campaign for the end of November. Perhaps at this time of year, where many climates experience drier winter air, talking about the increased comfort and decreased drying of newer silicone hydrogel lenses might be a good idea.
Make Busy Months Busier
If you continually allocate a portion of profits to re-invest in your practice, you can make your best months even better. If August is usually the month where you fit the most lenses, don't hold back for fear of being too busy. Instead, invest in excess inventory in mid-July and send a "Back to College" mailing to ensure students return for professional care and more lenses before heading back to school. Planning in such a way should also include staff schedules. If you carefully track trends, you can allocate staffing hours more appropriately. If August is usually when you get slammed with contact lens patients, do your best to make sure you have adequate staff on hand.
Reap the Vibes of Success
When business is slow, most practitioners start to think,"I better start marketing my practice. I haven't seen a new contact lens patient in weeks." The marketing product that is put out is often price focused as a reflection of the practitioner's current sense of financial desperation. Marketing when things are going well typically sends out a different message. Because the practitioner is coming from a psychological position of strength and abundance, his marketing messages usually exude more confidence and, in the end, work better.
Practices need constant care and feeding. Not only when times are tough, but when things are going well. CLS
Dr. Gerber is the president of the Power Practice® – a company offering consulting, seminars and software solutions for optometrists. You can reach him at (800) 867-9303 or DrGerber@PowerPractice.com.