As we like to say, the most important business decision you can make is understanding your finances. But in order to be a financially efficient med spa, there are three key areas to consider:
- Employee turnover
- Appointment cancellations
- Clean processes
Let’s dig into each of these areas and learn how your practice can reduce inefficiencies and maximize productivity!
A Financially Efficient Med Spa Reduces Turnover
To put it simply, turnover is expensive. Forbes explains that turnover impacts more than the human resources department–it also affects finances and operations. For human resources, it’s costly to terminate an employee, advertise the open position, interview, and onboard the new employee. Other employees might have to step in to cover the open position while the hiring is in progress. And training a new hire takes time and attention.
Productivity and customer service (operations) also feel the pain of employees quitting and new hires starting. And this impacts finances. Every scheduling mistake, unanswered phone call, or botched appointment costs your med spa money.
Here are two ways to help reduce turnover at your healthcare practice.
Hire the Right People
When it comes to hiring a new provider, there are two important factors: when to hire and who to hire. If a qualified candidate approaches your practices looking for opportunities, think twice before turning them away. Good candidates are always in high demand. An eager, dedicated employee might be worth creating a hiring budget for. Since you didn’t have to beg them to work for you, the odds of them being satisfied at work–and not quitting early–are higher.
On the other hand, if the front desk is booking appointments weeks or months in advance, it’s time to start looking for a new provider. You don’t want to make patients wait too long before they start seeking another practice. Plus, every postponed appointment has an opportunity cost. But when you start recruiting, don’t rush into hiring someone who isn’t qualified or has one foot out the door. Practice due diligence in interviewing every candidate.
Some signs of a good candidate include:
- Going the extra mile–literally, they’re willing to travel–for the interview.
- Researching your company beforehand and being prepared for the interview.
- Using correct grammar and spelling in their application–it indicates thoughtfulness and attention to detail.
- Following up with a thank you email and checking on the status of the position.
Compensation plays a big role in whether or not an employee feels valued in their role–and won’t go seeking competitive pay elsewhere. Experience, job security, and production all help to determine compensation.
Finally, remember that team morale matters. Make an effort to foster positive workplace culture with open communication, growth opportunities, and even fun activities. A happy and engaged employee is a long-term employee.
It’s no secret that appointment cancellations and no-shows can cause financially efficient med spas to take a hit. Missed appointments lead to open schedules and less revenue. This is why it’s so important to help patients understand why they must show up for appointments and what happens if they don’t.
Here are a few suggestions from American Spa on how to deal with no-shows:
- Over-communicate your cancellation and no-show policies. If you set a required cancellation period (such as 24 to 48 hours in advance) or a no-show fee, make sure to over-communicate the terms with customers. Remind them when they schedule the appointment and post the policy on your front desk, website, and around the office. Otherwise, customers may be surprised by a fee when they don’t show up. You can mitigate the confusion by reminding them–repeatedly–beforehand.
- Proactively confirm appointments. Your front desk can call, text, or email patients a day or two in advance to confirm the appointment. Make sure you call before your cancellation or reschedule policy kicks in so the patient has time to let you know.
- Use software to manage customer relationships. A customer relationship management (CRM) system can automatically track patient appointments, reminders, reschedules, or cancellations. This takes stress off of the front desk and helps get other patients in the door when one patient cancels.
Clean Up Processes
Lastly, a financially efficient med spa runs on efficient processes. Who should be doing what, by when, and how? If every team member knows their role and does it efficiently, your practice succeeds. There are many areas in which you can clean up processes, but here are a few places to start.
Create a clear financial plan. Your financial processes are crucial for success. Start by creating or fine-tuning a business plan and proforma. This means mapping out revenue, expenses, and start-up costs. How do you track these numbers? Who’s in charge of Key Performance Indicators (KPIs)? When will you measure KPIs compared to prior years? Cleaning up your financial process helps you know in what direction your business is heading.
Set a marketing budget. Marketing isn’t a loose term to be tossed around every time you buy dinner for an investor or sponsor an event. While these can be important parts of your marketing strategy, you want to keep an eye on the big picture. This starts with a budget. How much will you spend on branding? Your website? Lead generation? Patient retention? Cleaning up your marketing process will help your practice grow.
Establish processes with your medical providers. It’s worth being on the same page about inventory and refills, room turnover, patient follow-up, and so on. Together, you and your providers can spot inefficiencies and set standards moving forward.
If your practice can tackle turnover, appointment cancellations, and processes to make all three more efficient, you’ll see it in the bottom line. Don’t want to do it alone? Maven Financial Partners is here for you. We help dental practices, aesthetic medicine, and small businesses get their finances in order and grow in efficiency. Contact us today to learn more!