1. PRACTICE MANAGEMENT
Chiropractic practice can be conducted in many different ways. It all depends on whether the chiropractor wants to start out in solo practice or in a partnership or alongside other professionals. Starting out as a sole proprietor can be very daunting but many chiropractors do start out alone, do exceptionally well and ultimately have to bring either associates or partners into their practice. At the end of the day opening a Chiropractic practice is similar to starting any other type of business. There are important aspects one has to consider not the least of which is whether you are in the position to financially support your business.
Advice for the New Practitioner
Outlined here are some things that need to be considered no matter how you might open a practice. Whether it be as a sole proprietor,in a partnership, as an insurance based practice or as a multidisciplinary centre, there is certainly much to learn no matter what form you may wish your practice to take, but in essence the basic principles stay the same. You should start as most businesses do with a clearly set out business plan. As your business progresses you may obviously find that you need to adjust a few aspects of the plan to accommodate what is required for your practice to develop.
Some aspects to consider when starting a new business or taking over an existing practice:
Equipment
What chiropractic equipment do you need to practice your preferred technique? What other treatment equipment? What office equipment do you need, ie computers, tables, chairs, etc.
Space
How much space will you need? Is there parking space available? Is the area suitable for a healthcare facility?
Marketing
What brochures do you need? Signage? What events will you hold or attend. You also need internal marketing within your practice and external marketing- outside your practice, eg newspaper ads.
Networking
Networking is probably the least expensive marketing you can do, but it is time consuming. You must choose the events you attend carefully to make it worthwhile. Networking usually involves costs for meals, parking, travel, etc.
Wardrobe
Will you need to dress in a certain way to suit your practice and the area in which it is located.
Banking
You will need to have access to and use appropriate banking facilities. This is to ensure you can receive income into your business and make payments to your suppliers. You will also need to analyse the cost of having a credit card facility available for your patients.
Licensing
There are two aspects here: 1 Ensuring that you have the appropriate licence to practice as a Chiropractor and 2. Ensuring that you have the necessary business licenses required to establish your practice facility in your town, or state.
Continuing Education
You need to identify what is the ongoing requirement in Post-graduate education in the area in which you are practicing.
Insurance/Bonding
You will need to ensure that you have the required insurance coverage for professional and public liability.
Professional Services
You will need to have an accountant and lawyer to assist you. You will undoubtebly need other professional help from time to time.
You need to provide for all of these things when you are calculating your initial cash flow requirements, your breakeven point, and determining from those calculations what fees you should set.
It is suggested that a quiet perusal of the Powerful Practices Website might be a good introduction to what help is available in establishing a practice and in the training of staff [1]
2. SOLE PROPRIETORSHIPS & PARTNERSHIPS
More people start their own businesses as sole proprietorships, (about 70%) rather than as partnerships, only 6 percent based on data from BizStats.com.
Partnership business structures can yield great profits but are often fraught with relationship problems between the partners.. If you are still keen to develop a partnership business model consider the following points:
Creating a Winning Business Partnership:
- Have The Same Vision
- Define Business Roles
- Avoid the 50-50 Split
- Hold A Monthly Partner Meeting
- Create A Partnership Agreement
The partnership agreement should include such information as:
- The Amount of equity invested by each partner.
- The nature and Type of business.
- A clear description of how profits and losses will be shared.
- The Partners remuneration scheme.
- A description of the method of Distribution of assets should the partnership be dissolved.
- Adequate provisions for changes in or dissolution of the partnership
- Dispute settlement clause and settlement in case of death or incapacitation
- Description of the partners authority and expenditure limits
Partnerships work best when there is complimentary skill sets amongst the partners and when both partners are clear on their roles and responsibilities from the start.
The main issue with a partnership in most jurisdictions is the shared liability that comes with it. Should the business fail, both partners are liable for the debts, etc even if the failure is due to the actions of only one of them. Thus many business persons prefer to operate as a private limited company structure.
Multi-disciplinary Centre
The Mayo Clinic is One of the most effectively run business models for a multidisciplinary centre in the world. We suggest that if you are serious about running a multidisciplinary centre you should read the following book:
Management Lessons from Mayo Clinic: Inside One of the World’s Most Admired Service Organizations. Berry, Leonard L. Seltman, Kent D. New York: McGraw-Hill, 2008.
References
- The Centre for Powerful Practices [online]. 2010 [cited 2010 Feb]; Available from: URL: http://www.powerful-practices.com/
