10 Things Your Practice Needs to Thrive During Coronavirus and the Economic Downturn

white concrete counter stand

How can your office can come out even stronger than before during uncertain times? We’ll go through Top 10 things you should be focusing on.

Let’s start with an easy one…

1.    Don’t panic

It’s easy to panic. It’s natural. Especially after “good times.” Just remember that markets go up and down, and pandemics are beaten with vaccines and cures.

Realistically, it could be several months before things are back to normal. 

So, why shouldn’t you panic? 

Emotions like fear/panic lead to crazy decision making– like buying toilet paper or selling your stocks like it’s 1929. Not implying that we shouldn’t be taking precautions, especially those who are more at risk, like the elderly. 

However, it’s also important to remember that just like other pandemics in the last century 1918 Flu, SARS of 2003, the Swine flu (H1N1) of 2009 and Ebola in 2014, we’ll get this under control.

Now let’s talk about the markets. We’ve just experienced the longest bull market run in history.

Experts are saying that this isn’t 2008 again, let alone something worse. Although you can just as easily read that the skies are falling- it won’t do you any good.

That being said market corrections are normal- in fact they typically happen every year.

Stock market corrections last 71.6 days, w/ markets dropping 15.6% (https://www.visualcapitalist.com/anatomy-market-correction/). 

In fact, since 1920 there has, on average, been a 5% pullback three times a year, a 10% correction once a year, with a 20% plunge every 7 years. 

In the five years before 2018, the Dow Jones Industrial Average nearly doubled without any meaningful pullback. https://www.thebalance.com/how-to-handle-stock-market-corrections-2388309

For each of those years, a significant number of analysts called for a correction or even a recession. These predictions have caused investors to pull out of the market too early and lose the impressive gains they could have enjoyed if they didn’t try to predict when the inevitable would come. This is true of individual investors as well as professionals.

BOTTOM LINE: Markets ALWAYS drop…. and they ALWAYS come back up!

2.    Be grateful

Look at what you have and be thankful! Whether your practice is just starting out or you’ve been in business 30 years, there are plenty of reasons you should be grateful, here are just a few.

–         Gratitude lowers anxiety and depression

–         Studies show that gratitude improves satisfaction of life and make you happier

–         Markets are going to rebound, they always do

–         The Coronavirus won’t last- pandemics always are beaten

Do you ever wish you could do a “TIMEOUT,” like Zack Morris in Saved By The Bell, where the world freezes? 

You’ll likely have a few weeks where nobody’s working and business is shut/very slow, think of this as an opportunity to get the things done that you always wanted to get done….but never have any time!

3.    Analyze your business

I’ll try to keep it simple. A successful business earns more than it spends. Let’s break those two categories down.

a.      Earning

Knowing your patient value is crucial– here are some suggestions:

Determine the lifetime value of your typical patientLifetime Value (LTV)=    Number of Years as Patient X Annual Spend + Client’s Referral Value

Dental office example:

         7-10 years X $653 each year = $4,571 to $6,530… NOT counting their referrals!

 Do you have certain clients that bring in more money than others?

The 80/20 rule (also known as the Pareto rule) basically states that 80% comes from 20%. 

Examples:           

  • 20% of drivers cause 80% of all traffic accidents
  • 20% of a companies products represent 80% of sales
  • 20% of employees are responsible for 80% of the results

How does this apply to you? Let’s say you offer 10 core procedures. Chances are, 2 of them will make up 80% of your revenue. Do the math in your practice. Seriously. I’ll even bet that your number is over 80%. 

So If Procedure A + Procedure B make up 80% of your revenue, wouldn’t it make sense to get more of Procedure A and Procedure B? 

Come up with a strategy to focus on the more profitable procedures!

b.      Spending

The 80/20 rule also applies here. 

You’ll likely find staff/rent or mortgage/insurance and supplies are likely pretty high on your list. 

Staff:   Are tasks being done by multiple people

Before you go firing people, take a step back and analyze their responsibilities. You may discover morale boosting opportunities! 

–         Schedule performance evaluations. Evaluating performance is crucial to an employee’s growth. 

–         If you can understand their strengths and weaknesses (or even what they like/don’t like) you may be able to increase efficiencies and reduce redundancies

Hours: Are certain days always slow? Are you closed on Saturdays? There are huge advantages in being open when others aren’t! 

Nobody likes working weird hours or weekends, but nobody likes Mondays either. Analyze and adjust open hours and maximize staffing hours to jump ahead fast. 

Insurance: When was the last time you explored alternatives? What about other benefits, like retirement plan(s)? 

Supplies: Everything is negotiable. Don’t believe me? Tell your vendor you’re shopping around and watch what happens. 

Another idea is to consider “lightly used” furniture or supplies. Cost savings can be substantial.

Here’s a few links that address some of these costs in greater detail:

https://www.dentaleconomics.com/practice/overhead-and-profitability/article/16393116/you-choose-your-overhead
https://www.dentistryiq.com/practice-management/financial/article/16367892/controlling-your-dental-practices-overhead
https://www.aafp.org/fpm/2010/0300/p38.html
https://www.physicianspractice.com/keeping-medical-practice-overhead-down
https://www.medicaleconomics.com/business/whats-ruining-medicine-physicians-rising-staff-and-overhead-costs
https://www.99mgmt.com/blog/medical-practice-overhead-expenses

4. Make cuts like a surgeon, not ax chops like Paul Bunyan

Don’t get crazy. If you’re running a successful practice now, there’s no reason to turn things upside down. On the flip side, if your practice is overdue for some changes, make them methodically

Let’s say you want to trim your utilities. It’s probably not a good idea to make 79 Fahrenheit the new “norm,” and expect patients to return…let alone a happy staff. 

Invest in a smart thermostat to dial back during off-hours. Nest users saved an average of 10% to 12% on heating and 15% on cooling (https://www.moneycrashers.com/cost-cutting-ideas-small-business-expenses/).

If your office is old, double-pane windows or upgrading the seals on your door/window frames costs a few dollars but can save you hundreds.

The majority of complaints in healthcare practices isn’t with the doctor or provider, it’s with the small things like parking, getting someone to answer the phone or most importantly, a friendly smile

Keep staff happy while they may be your top spend, they’re the backbone of your office

Not to mention, the costs of on-boarding a new staff member takes months and typically costs a minimum of 20% of their annual salary. 

https://www.americanexpress.com/en-us/business/trends-and-insights/articles/10-simple-ways-to-cut-business-costs/
https://www.thebalancesmb.com/how-to-cut-business-costs-2948320

 5. Reduce lost opportunities

How many people leave voicemails these days? I’ll skip the studies and just tell you…nobody. 

If you’re lucky enough to get a referral for a new patient– regardless of whether it’s word-of-mouth or from your superior online presence, you are one missed call away from losing that referral to the next office that shows up in the Google search.

Let’s say that you are answering every call- how many new callers become patients? We’re not talking about solicitors or vendors, only new callers. Typically, 3 in 10 calls turn into actual appointments. 

Assume any caller asking questions is a referral- if they’re asking questions about costs or a procedure, they’re interested!

You should record and analyze your calls, you can better train your staff to turn interested parties into loyal customers. 

You can outsource phone answering to a professionally trained staff in the US to help offload this responsibility from your staff- at a fraction of the cost!

Bottom lineYou should never miss a call and each call should be tracked! 

If you don’t already have online booking available, here’s one fact you can’t ignore. 40% of millennials won’t book an appointment unless there’s online booking.

6. Don’t take on too much

Cutting back and decide to start answering your own calls/sending reminder calls? Take a look at what your hourly value is. Staff too.

Let’s assume you expect to be earning $150,000/year. 

Based a 40 hour work week with 2 weeks’ vacation, there are 2,000 working hours per year. 

Therefore, your wages are $75/hour.

Let’s assume you’re paying an employee $20/hour ($40,000/year). 

Add in their health insurance, retirement package, etc.…. they’re cost is closer to $27-$34/hour

Asking your employee (or taking it on yourself) to add a new task will either cost you more time, and therefore, more money.  If you’re not willing to pay them more, you will sacrifice the quality of the work required.  

Don’t jeopardize the morale of your staff by having them work more hours without pay and don’t expect good results if they’re already working a busy shift and now have more responsibilities.

Scenario #1: One of your employees handles appointment reminders, billing questions, or social media posting.           

Scenario #2: You have a friend or family member handling tasks for you. 

Assuming your employee still needs to do their normal tasks, you’re on the hook for overtime. If they are paid salary, they’re now working 45 hours instead of 40, and therefore require a pay raise to avoid losing morale.

Many offices rely on friends and family, which leads to uncomfortable situations when they’re not performing. 

“My friend/family member does a great job!” 

Things to consider/ask yourself:

–         Everybody loves a family business. Are you paying them what they deserve?

–         If you’re asking someone to do work for you below market rates- how likely is it that their results are what your practice will need to thrive?

–         If you’re asking someone to do something they aren’t trained to do, how good of a job do you expect them to perform? 

Would you hire your brother, who works in operations to do your taxes? Then why ask someone to handle these tasks if they’re not a professional?

7. Automate processes

Does your office still handle these tasks manually?

–         Bookkeeping or Paying bills

–         Looking up passwords

–         Email/text reminders for appointments/birthdays/promotions?

–         Getting forms from patients

–         Posting to all of your social media accounts

–         Responding to social media post comments

–         Request reviews from clients

–         Responding to reviews from clients

–         Not offering online booking

If you don’t already have a process in place for these recurring tasks to be automated- it’ll save you time and money while increasing your retention rate and rate of incoming referrals.

8. Offer discounts

You already know that certain clients are worth more to your business- maybe things are slightly different in today’s times. For example, if you offer a cosmetic procedure, it’s less likely that you’ll see an influx of new patients. Perhaps now is the time to take advantage of follow ups or annual check-ups?

Whatever area you see an opportunity- now is the time to offer a special or promotion. Offer telemedicine? Promote it! 

Don’t forget that tax returns are going to start getting processed soon, it’s never too early to start planning and promoting for those extra dollars that will be coming in!

9. Find discounts (negotiate)

If asking for a discount makes you feel uncomfortable- just imagine how often you experience this in your own business. When markets are good, people rarely think to ask. 

If you buy anything online- including software or things on Amazon, a lot of times you don’t even need to ask. Start with the browser extensions Honey and WikiBuy- every time I go to a site that has a discount, I’ll get a popup when there are discounts available. Sometimes there aren’t any, but often times I’ll save some money. 

You’d be shocked at how often people can be flexible- especially when the economy isn’t performing! It’s easier than you think to ask

For example, every time I book a place on Airbnb or VRBO, I’ll send a message to the host asking if they can be flexible. 

In my experience, about 80% of people are willing to negotiate.  Some will ask for more specifics, “how much are you looking to spend?” Others will just send a new offer. 

Try to avoid being ridiculous- don’t expect to pay 50% off.  You don’t want to waste your time or anyone else’s. 

Start with a goal (for example, 30% off) and make sure to communicate with the other party- even if you decide not to move forward.

It doesn’t hurt to tell people that you’re shopping around. In fact, most people know this and will appreciate your honesty.  Tell them what it is you’re looking for and what expectations you have. Who knows- they may have something else that is a better fit!

Just like everything else, it pays to be transparent. If you are open about what you’re looking for and willing to spend, people can save you a lot of money or time by knowing what it is that you’re looking for. 

Remember, if it’s not worth it for them they won’t accept. If it is, you may find out that both parties can be happy at a more favorable rate for you!

10.  Stand out from the crowd

“Buy low, sell high.” It’s always been easier said than done.  When times are rough, people want to cut costs and typically will cut costs with an ax- starting with their marketing

Not a good idea. 

Cutting costs at a medical practice isn’t easy.  Your online visibility is more important than ever before.  Especially when people rely on their phones as much as their friends and family!

Why?  Chances are that your competitors are cutting costs. Chances are you and your competitors rely on “word of mouth” referrals, but statistically speaking, your online word of mouth is just as (if not more) important

Some interesting statistics for you:

9/10 will research you online (including word of mouth referrals)

6/10 will go somewhere else if they find someone better

Which means that only 4 out of 10 people that want your services are actually becoming a customer of yours.

How do you fix this? The first thing to do is make sure your online presence is significant

Since your search engine already knows you’ve looked yourself up (and will therefore more likely show you…well, you). Open up an “incognito window,” and look for your business. 

Are you at the top? If not, you need to invest some time and or money into your online presence. If yes, try searching for your services. A good place to start is “__your specialty___ near me.”

Find your business? How do you look? Do you see any reasons why people would choose a different business other than yours? 

A few things to look for:

–         Your office is hard to find (i.e., not on page 1)

–         Your office has bad reviews

–         Your office has limited reviews

–         Your office has wrong information listed

–         Competitors look better than you

Try going to the “maps” section when completing a search. This is a great way to see how people search. If someone is within a short distance of you and there are better options, it’s going to take a mighty strong recommendation to overlook any competitors that look significantly better than you online.  

Hopefully this gives you some ideas, more importantly, I hope you do something with them!

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