Practice Management

The Challenges I Met to Achieve a $450 Per Patient Revenue with Minimal Staff

Dr. Davison with her staff. Dr. Davison says the right office processes and technology have enabled her to build a profitable practice with a small team of employees.

By Janelle Davison, OD

Dec. 8, 2021

No one told me it was going to be easy, but they also didn’t say it would be a battle every day from virtually every angle. Welcome to life as an independent practice owner! In my practice’s 11 years of serving my community of Smyrna, Ga., we have ridden the waves of the private OD industry.

And, it seems like now, more than ever, private practices face pressures from multiple fronts. But those of us fortunate enough to survive (and thrive) pick up a few things along the way.

In the current private-practice landscape, I have dealt with the revolving door of new hires, sharp changes in patient purchasing habits, and most importantly, how to deal with the fears that come with owning a business.

Lessening the Impact of Employee Turnover
Over the course of our practice’s lifetime, we have had 50+ employees come in and out of our doors. And, now, increasingly, a reliable employee who is vested in the practice is hard to come by. They are like unicorns that you should cherish if you find.

Having a reliable team is a foundation for a successful business. But the number one thing you hear from employers is, “I can’t find anyone who wants to work.”

After years of constant retraining, we think we have finally found the key to success. Yes, employees are going to have their options. So, we found an approach that allows us to thrive regardless. The cost of each new hire can be as high as $2,000-$3,000. Imagine bringing in someone new every couple months. That is a reality for many of us. The costs include recruiting, training, loss of productivity and loss of revenue. Recruiting and training can’t be avoided. It’s the last two points that we have virtually eliminated.

For people in our industry, loss of productivity equates to reduced capture rate and reduced revenue per patient. That means less money to run the business effectively. We came up with the solutions to address those problems. We eliminated the loss of productivity by (1) cross-training EVERYONE, and most importantly, (2) implementing a plug-and-play system for providing price quotes to patients.

Cross-training is a key. By doing so, we were able to remove the front desk role permanently two years ago. This amounted to a savings of about $3,000 per month. By removing this role, we empowered all of our staff with the ability to book an appointment and to check in a patient. Cross-training is a part of our weekly to-dos. We meet with staff bi-weekly to ensure everyone is abreast of keys to operating the business, and we plan to add a four-hour training once per month. We turn off the phone and train, train and train. This level of training means that if we lose a tech, someone else can jump in. If someone calls for an appointment, we don’t miss that opportunity.

The loss of revenue and productivity  from a revolving door of new employees is no longer an issue for our office, and never will be again. How? By implementing a plug-and-play software, Paradeyem. Now, we could bring in someone off the street and they could provide a professional quote in the manner of good, better, best. Paradeyem allows us to create predetermined lens and frame packages at the beginning of the day for ALL of our patients on the schedule. Imagine the optician sitting down, entering a frame cost, and voila, the patient is given three options.

Though optical sales account for 60 percent of our revenue, we use minimal staff while maintaining a per patient revenue of around $450 and a capture rate between 55-60 percent. All this with a computer-savvy (and cost-effective) staff payroll.

Capturing Eyewear Sales Despite New Consumer Buying Habits
Let’s face it, patients have many options. If we don’t pivot, our offices will no doubt fail to capture eyewear sales. I came to this realization like most eye doctors–by watching sales walk out the door. Patients can go online. They can go next door to your competition or they can just choose to wait. They have options, and this has an effect on the bottom line. And a huge swath of our patient base, ages 20-35, is looking for choice and, often, a good cause/story tied to the practice. As a doctor who is willing to respond to patient expectations, I have implemented solutions to accommodate this change in buying habits.

At one time, our office sold everything a la carte. That model is proving obsolete, so we mastered a different way of selling both contact lenses and glasses. Our contact lens capture rate is around 75 percent, and by implementing a good, better, best choice model, we capture sales at a higher revenue.

Our Paradeyem software allows us to package ALL of our glasses, and for contacts we provide three options for ALL patients. We make it easy for the patient. They can choose from a six-month supply, an annual supply or a monthly in-house subscription, we call H.E.R.O. (Healthy, Easy, Reduced-Risk Option) for daily contacts. Offering three simple options for both contacts and glasses checks that important box of choice that patients are looking for.

Additionally, with the implementation of an edger and purchasing stock lenses, a patient looking for Warby Parker-type pricing, has cash options in our office with low-cost, high-margin frame, lens and add-on packages. This enables us to offer options that are on par with our online competition. These options are not our go-to, first choice for patients, but for those patients who just “want their prescription,” we have successfully implemented POP and communication strategies to make that demographic aware of our affordable cash offerings.

We were able to secure a China-based manufacturer with a low minimum order quantity and private label frames affiliated with my non-profit, S.C.O.R.E. Inc, which is focused on exposing young minority women to careers in medicine, dentistry, optometry and ophthalmology. Annually, we donate a portion of our sales to S.C.O.R.E. This enables us to sell cash packages competitive with some online retailers and provides that much-sought-after story that motivates many consumers today when making buying decisions.

Conquering Fear of Change
Fear in any walk of life can be paralyzing and a dream killer. For my practice, and for many doctors I often speak with, there is a fear of change. And the fear is often justified. In my 11+ years in business, I feared changes that would “rock the boat” in my staff’s or patients’ experience. But I had a dream of what I wanted my practice to be and I couldn’t let fear stop my progress.

It has been said that the definition of insanity is “doing the same thing over and over and expecting different results.” Some doctors never reach that point of insanity. However, I was blessed to reach that point because that’s when I realized changes had to be made. I didn’t want to do 30 patient exams every day and still struggle to cover expenses. This is the same story I hear from many doctors.

For our office, getting over fear, and making needed changes, meant (1) setting the tone as the doctor. I learned that my staff would move only if I showed that I wanted to move. They needed a push and the vision of the leader of the office. Getting over fear for me also meant (2) communication, communication, communication. Often, just letting the staff understand in our weekly Monday meetings our changes, and how it will benefit the practice as a whole, helps us get over the fear of change. And (3) I realized the importance of sticking to a plan and my vision for the practice.

What’s the cost of being paralyzed by fear? For a private practice, there is both a financial cost and a cost in peace of mind. I talk to many doctors, and their goal is always to increase the number of patients on the schedule. Rarely do I hear about a focus on increasing revenue from the patients they already have in front of them.

When I was in optometry school, my goal was not to have a high-volume practice. My goal was to have a practice in which I could spend time with patients and have work-life balance. I achieved this by taking a chance and cutting my book, spending more time with patients and implementing a more efficient way of working with patients via eyewear and contact lens packaging.

Many doctors can cut their volume down by 40-50 percent and increase revenue per patient by 30-40 percent by making changes. This opportunity is often lost just due to fear. There must be a paradigm shift from operating the same way a chain operates. I have succeeded by providing a great customer experience and focusing on revenue per patient rather than volume. It’s been great for my work-life balance!

By not succumbing to fear, and making drastic changes, our office saves about $60,000 per year in salaries, and at the end of this year, our office will have a revenue increase of 40 percent over 2019 (last full non-COVID year). In my thirst for, and experience, in conquering fear, I created Lynken Profit Solutions, a consultancy to help doctors get over fear and start on the path toward the practice of their dreams. ODs have too many barriers. To overcome those barriers we have to be confident and take chances to become who we want to be.

Janelle Davison, OD, is the owner of Brilliant Eyes Vision Center in Smyrna, Ga. To contact her: info@brillianteyesvisioncenter.com

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