Nov. 4, 2015
Matthew Alpert, OD, owner of Alpert Vision Care, in Woodland Hills, Calif., and Wink Optometry in Calabasas, Calif., reveals how opening a second office allowed him to capture a different demographic and boost his overall profitability. In his case, keys were finding the right location at the right time, and promoting his second location economically by leveraging its high-visibility location. Economies of scale are few with just two locations, he cautions, but there are synergies to be captured as you expand to a second office.
Offer a Different Experience in a Second Office
Work the Numbers Backward
Achieve Economies of Scale
Matthew Alpert, OD, says that opening a second office in 2009 gave his 75-year-old practice a chance to continue growing, while offering patients a distinctly different experience.
The financial downturn of 2008 gave Dr. Alpert the chance to invest in a high-end retail location that he says otherwise would only have been open to big-box retailers.
With a primary location that Dr. Alpert thought had reached its maximum growth potential, a high-end location gave the practice a chance to create an office experience for the “consumer of the future.”
“I jumped in, took a big risk, and it paid off well,” says Dr. Alpert.
The high visibility of the second office, which is located in a high-end retail district, means the second offices gets many more passersby and walk-ins than the primary location. For that reason, he attributes some of the expenses associated with the rent to money that would have spent in a less prominent location on marketing and advertising.
The investment in the second office paid off almost immediately, with the second location “in the black” by the third month after it opened, bringing in nearly right away 20 percent of the money brought in by his primary location.
Being successful first in the practice’s primary location gave Dr. Alpert the confidence he needed to open a second office. He knew he already had the skills in place to manage staff, find and successfully work with vendors, and to take a positive approach when working with managed care partners.
“Having all that experience made me feel positive about opening the second office,” he says.
One of the goals when opening a second office is achieving economies of scale in cost of goods, but Dr. Alpert says that doing so is not as easy as he thought it would be. He notes that practices with just two or three locations often don’t have enough volume in the products ordered from vendors to achieve great savings.
However, he says that having two offices gives you a chance to “cross-pollinate” merchandise between the two offices, moving merchandise that isn’t performing well in one location to the other location, rather than just marking it down, as you might have to with just one office.
He says he also has experienced slight savings in contact lens inventory spread between the two offices.
Matthew Alpert, OD, is the owner of Alpert Vision Care, in Woodland Hills, Calif., and Wink Optometry in Calabasas, Calif. To contact him: drmalpert@aol.com
