Carl Spear, OD, FAAO, of Sight & Sun Eyeworks in Pensacola, Fla., advises that any practice must operate from a sound and comprehensive financial management strategy. This includes setting aggressive growth goals a year in advance—and then tracking seven key areas of expenses. It is critical to include staff in the financial management process, since staff can find cost savings that translate into enhanced profits.
ACTION PLAN
SET GOALS. Be aggressive in setting growth goals—a year in advance.
TRACK KEY AREAS: Track seven key areas of practice expenses.
INVOLVE STAFF. Challenge your staff to reduce costs—and turn expenses into profits.
KEY EXPENSES TO TRACK (In suggested percent of total revenues)
Cost of goods 25%
Staff salaries, benefits 20%
Staff training, education 2%
General overhead 6% (reducible to 3%)
Marketing/promotion 5%
Occupancy 10%
Patient care/equipment 5%
TOTAL 73%
NET PROFIT 27%
Carl H. Spear, OD, FAAO, and his wife, Katie Gilbert-Spear, OD, MPH, own four practices in the panhandle of Florida. He lectures extensively and serves as an industry consultant.To contact him: cspear@icareventures.net
