Issue #36 – Liposuction for Your Budget
One of our favorite comedic sitcom quotes comes from NBC page Kenneth Parcell on 30 Rock, who delightfully recalls, “I’ve had my fair share of rock soup and squirrel tail, but I’ve also known leaner times.”
As summer draws to a close and we usher in the fall, we grow ever closer to the typically busy season for elective surgeons. More patient inquiries arrive, surgical schedules fill, and concerns we had during the summer lull diminish until you can’t remember why we worried in the first place. We’re not there just yet, but it’s right around the corner. Plenty of rock soup and squirrel tail await us all!
It is during slower times, between various “pops” throughout the year, that we encourage our YellowTelescope long-term clients to take a look at their spending. It is tempting, albeit counter-intuitive, for doctors and administrators to immediately look towards marketing cuts. As most marketing items come through the credit card bill and are more readily visible than general ledger items on the profit and loss statement, it seems they stand out and get cut quickest. We would argue that if a giraffe wants to lose weight, cutting off its head and neck is not the smartest choice, even if it is an obvious one. While some marketing initiatives fail and should be cut regardless of time of year, most spending related to sales staff and marketing both on and offline, are profit centers. The lifeblood of your business, even during the slow season, is the last place we want to see doctors cut.
A better alternative is to audit your P/L and focus on the “cost centers.” We recommend doing this at least once a year, along with an annual review of your vendors, and whether or not they are getting you the best rates. Some great places to “lipo your budget” might include:
What percentage are you currently paying for your credit card processing? The service from one company to another may not be much different, but even a fraction of a percentage point can save you thousands. Contact us if you’d like to consider other options and would like a recommendation.
Are the more expensive paper towels getting you more patients? Could you be saving $30 on each box of stitches? Are there options to negotiate better rates on injectables or skin care? This is a great time to renegotiate with your suppliers. Get them on the phone and simply ask for help or contact us for ideas on how to save money through our complimentary introductions to companies that can save you money for the exact same products.
Here at YT, we recently went from pre-paid monthly IT services to an hourly rate, and it saved us thousands. This is a no-brainer for practices much smaller than we are, but even larger, multi-doctor groups may find some extra money by considering options to save on these services. Again, if you need assistance finding a truly superb medical IT services company, contact us today.
Online Marketing (PPC especially):
While it is generally a profit center, don’t assume that you’re spending what you should be. We recently helped a doctor audit his PPC campaign less than a month ago and found that he was over-spending on Facebook by $2000-3000 a month. That’s $36,000 a year! Let us know if you’d like some help determining your ROI on SEO, pay-per-click or social media advertising.
A penny saved is a penny earned, so how much do you pay for garbage pick-up? What about your groundskeeper or cleaning service? Are you paying too much for your landlines or cellular service? Are you efficient with your medical supply orders or is there waste every week or month? We just saved one of our clients 10% on his medical supplies by referring him to a less expensive option. Based on your annual expenditures, would that be enough to make a change? What could you do with that money?
You’ve heard the phrase “every little bit helps”, and it’s true. By evaluating your vendors regularly, negotiating new contracts where applicable, and switching to less expensive providers when it fits, particularly for your “cost centers,” you can find money almost anywhere. Before you know it we’ll be in the heart of “season” and months will have passed, so now is the time to take a close look and lipo the fat from your budget until it’s leaner than rock soup.