Optometric Management Tip # 374 - Wednesday, April 08, 2009
Is office space limiting your growth?
As you analyze the factors that either contribute to your practice success or hinder it, be sure to include the size of the office space. Many of the elements that I believe are responsible for growing a larger practice (with greater revenue production) are philosophical in nature. But, office space is physical and if it's too small the strategic factors you want to implement become impossible.
Let's examine the major success factors and consider how physical office size can impact them.
- A passion for customer service. Well, you can certainly provide excellent service in a small office and that is a major reason why small offices can still be successful to some degree. After all, a caring attitude does not require large space. But, if we define customer service in a very broad way to include all aspects of the patient's experience, more space will prevail. As more customers are seen, which is a basic goal of any business, the customers will be forced into closer proximity to strangers, and many people find that uncomfortable. If patients have to wait in the reception area, it's nicer if they are not too close. If a patient is selecting a frame, it feels good to have some privacy. If the receptionist is making phone calls, it is preferred that patients don't hear every word.
- Delegation of clinical and administrative duties. Delegation is a key strategy in practice building, but it takes space. I can envision a team of highly skilled technicians assisting one doctor. Excellent quality of care is delivered in a very efficient manner. We need multiple pretest rooms including a room for retinal photography. We need multiple exam rooms and they need to be large enough to accommodate a scribe. We need a technician work area so the staff can review charts, call patients, order products, call other doctors and handle a myriad of work flow.
- A large staff. To implement large scale delegation in clinical, optical and business areas of the practice, we need a large staff. I view a large staff as a good thing because it is the infrastructure of success, but the staff must be well managed and we need to cultivate good attitudes. Giving people some space is a key part of being a good place to work. Close quarters creates stress. We need a bigger front desk with more work stations. We need a staff lounge. The office manager needs a private office. We even need to consider that we provide ample parking for employees and still have plenty of room for patients.
- Advanced clinical instrumentation. High tech instrumentation provides clinical benefits, allows us to delegate more procedures, produces revenue and creates a competitive advantage that sets the practice apart from others. Instruments are great investments, but they obviously take space.
- Impressive optical dispensary. Optical dispensing is very important to success in optometric practice. Patients place a high value on optical services and it produces an impressive revenue stream which does not directly require the doctor's time. A strong optical department can be a great competitive advantage resulting in powerful word of mouth referrals. An impressive optical requires floor space. It requires a significant investment in inventory, displays and furnishings. We need to be able to carry out several frame selections at the same time and still handle walk-in patients who are picking up glasses or getting repairs.
- Associate optometrists. As the success factors above are put into place, patient demand increases. The natural evolution, if we want to continue to increase productivity, is to bring in associate doctors. This is an excellent goal and it dramatically increases revenue, but more doctors working at the same time creates a need for much more office space.
It may be easier to change your practice philosophy than it is to move your office, but realize that many of the proven management strategies will not work well without space. Ironically, once you have more space, the strategies that some doctors struggle to implement become very easy; efficiency becomes a no-brainer.
A large office or branch offices
Moving to larger quarters or adding on to your current space is a great idea for most practices, but opening branch offices is another way to provide more office space. Both of these moves can be good; one large office offers some economies of scale and creates a very impressive public image, while branch offices allow the practice to reach into new markets and attract additional populations.
Geographical trends in real estate
I have recently spoken with optometrists who practice in California, midtown Manhattan and some of the New England states and I'm very aware of the high cost of real estate. It may be prohibitively expensive to have a large office in the early development of a practice, but many practice owners really never push the idea of seeking more space. They become settled in with that they have. Of course, that's fine if all of one's business goals are being met, but if there is a desire for more income, then more office space is a key component.
When it comes to large decisions like a new office, it's easy to put it off. A person might think he will wait for a signal, such as increased business demand, to justify the move. The problem with that approach is that in most cases there is never such a signal. Business success usually occurs when the owner makes something happen by taking an independent risk. Create the facility and the business will follow. Act as you mean to go.
We may never again see the bargains in real estate that we are now experiencing. Buying and owning commercial property for your office is the smartest way to go in my opinion, but rental space is also available at favorable rates in many areas.
The dramatic power of a move
From my own experience and that of many other optometrists I've talked to, moving to a larger, nicer office provides a marketing punch that is very real. Practices that move into a more impressive facility become busier. I think this is due to a combination of factors:
- Established patients perceive that they will receive better services.
- The community at large notices the practice, maybe for the first time.
- A new progressive image for the practice is developed. A move means the practice is investing in itself, which means it must be strong and successful.
- Staff members develop new enthusiasm which is contagious and is instantly felt by patients.
- The new location may have increased visibility and larger signage.
Best wishes for continued success,
Neil B. Gailmard, OD, MBA, FAAO
Chief Optometric Editor, Optometric Management