Strengthen Your Business Skills:
A Practical Business Skill Development Series
for Physical Therapy Business Owners

In the upcoming months I will be focusing the business tips I send you twice a month on strengthening your business skills.

You will receive the MOST successful, effective, and easy to implement tools and strategies I know for strengthening physical therapy business owner skills. These tools and strategies have proven to give the best results I have learned from coaching physical therapy clinic owners exclusively over the last 5 years.

Strengthen Your Business Skills #1

Tool to Help You Evaluate Your Business Owner Skills

Step One:

For each of the business owner skills below identify your areas of strength (s) and weakness (w)

___ Leadership (identifying my business vision and setting the pace for realizing this vision)

___ Interpersonal skills (dealing with suppliers, customers, employees, lawyers, accountants, government officials, and everyone in between)

___ Management/Operations (business structure, plan, processes, systems)

___ Client fulfillment (supplying high quality services and products)

___ Marketing/PR (branding, marketing planning, visibility in your target market)

___ Organizational Skills (time management, keeping business focus on big goals)

___ Getting referrals (how to, follow through)

___ Resource Development (developing and leading team members)

___ Finance/Revenue (setting up financial systems, controls and reports)

___ Quality control (tracking the quality of services, customer satisfaction, improvement to services)

___ Personal business skills (oral presentation and written communication, computer, etc.)

___ Intangibles (ability to manage risk and stress, family support, ability to deal with failure, ability to work with and manage others)

Step Two:

Make a list of your strengths and a list of your weaknesses.

Step Three:

1. Identify your top priority for strengthening your business skills in 2012.
2. Identify your single biggest challenge in achieving this goal (in other words, what is getting in your way).
3. Identify what one thing you need help with to achieve this business skill and goal?  Now take the first step in strengthening your business skills.

Here we are in the first month of a new year, which many of us consider a time for a new start and a time to make the changes in our businesses and life that we have long dreamed of.

The months leading up to the new year, as well as the first months in a new year, are sometimes characterized with grim economic predictions, patients cancelling appointments or postponing treatment plans, and seasonal flues causing staff to be away. In other words, it may be a worrisome time for you, the business owner.

If your practice struggles from one or more of these scenarios, your profits will also be falling. Unless you have a plan – (you do have a plan don’t you?).

November and December proved to be very busy for me with numerous practice owners calling for help in their businesses. They all want to set themselves up for a more profitable year. They are clearly motivated to make changes, with the necessary structure and strategies to be successful at making them.

There are two obvious strategies you can use in difficult times. The point of this article is to demonstrate that one strategy, finding ways to increase your practice gross revenues is far more effective in the long term than the other strategy, cutting your practice costs, which will have a limited effect on your bottom line.

Let’s discuss The Two Strategies:

1. Cut your practice costs
2. Find ways to increase your practice gross revenues.

Strategy No 1:  Cut your practice costs 

Of course, it’s always a good idea to review and track your costs regularly.

A physical therapy practice has two sets of costs. “Fixed Costs” are those that remain pretty much the same month to month, the biggest of which is usually staffing costs, closely followed, in many practices, by lease costs.

By their very nature, fixed costs are hard to reduce, and with inflation, you might even find them hard to maintain at their current level.

Your Options Include:

1. Reducing the amount you pay your staff or reducing your staff numbers
2. Reducing your lease related costs
3. Reducing your service contracts
4. Reducing your professional services fees such as Accountancy, HR etc.
5. Buy cheaper coffee (No!)

The rest of your costs are “Variable Costs” because they are linked to the practice gross. These costs include: the costs of receivables, associate remuneration, supplies and equipment.

Your options include:

1. Collecting your receivables, keeping them as low as possible each month, and as short term as possible.
2. Cutting Associate remuneration
3. Reducing your purchases of supplies and equipment or using cheaper materials.
4. Cutting your business support personnel costs.

These variable costs, together with your staffing costs, are usually the largest costs in your business, and small savings will make a difference. I’m sure you will understand that shaving percentage points from some of these costs is hardly going to make you popular with the people that are pivotal to your success. I’m not saying don’t do it; I’m saying if you are going to choose to cut in these areas, be aware of the effects it will have on morale and the quality of the services that your practice can deliver.

If you are able to cut fixed and variable costs by 5% (quite ambitious), the effect on your profit in the business will be minimal.

Strategy No 2:   Find Ways to  Increase Your Practice Gross Revenues

This obviously means increasing your patient numbers and the demand for your services.

How can this be accomplished with the challenges you are experiencing?

Below are strategies that will work to increase your revenues and profits in the immediate and long term:

Strategies That Work

1.  Make your client journey remarkable every time and thereby boost your client referrals.

2.  Engage your team members in your practice vision and plans, thereby, creating a culture in which they support and share your dreams and goals.

3.  Find ways to communicate the value of your physical therapy services to the marketplace effectively.

4.  Differentiate your fees for regular, simple physical therapy services from fees for more specialized services.

5.  Increase your client numbers by:

• Reactivating dormant clients
• Reactivating dormant treatment plans
• Increasing treatment plan uptake
• Increasing treatment plan value
• Increasing referrals to other professional team members
• Increasing the effectiveness of your marketing

6.  Strengthen your relationships with referring partners such as physicians, other professionals, and community agencies.

7.  Extend your opening hours.

8.  Extend your service offerings.

When you implement these strategies,  you will see that increasing gross revenues is more effective for the long term than cutting costs. Doing both will clearly give the best results. Either way, if you want to be one of the winners during the first quarter of 2012, then you better have a plan to implement now or be willing to watch your profits fall further…

And if you would like some help with growing your practice by working with a professional business coach with a proven track record….

Simply email me to set up a 15 minute consultation to explore the possibility of working together.