Tips and tools for setting up a practice
Setting up a practice
If you are considering leasing or purchasing your own surgery rooms, there are a few important questions you may wish to ask yourself before choosing the premises that best suit you and your patients’ needs. Explore them below. And find out more about some other key considerations when buying a practice with our practice purchase tips article.
1. Develop your business plan
Take time in the initial planning stages to complete a business plan. A good business plan will give you a clear direction for the-set up and running of your practice, and allow you better control over your practice’s future.
- Find out about the importance of a business plan for a successful practice
- Download NAB Health’s business plan template
- Find out more with our article on how to write a business plan
- Download our business plan questionnaire
2. Identify your ideal patient base
The demographics of the locality you are assessing for your practice will affect your potential for business growth. Have you considered the type of patients you would like to attract – families, workers or retirees? Thinking about the needs of your target market, will the best location for your practice be close to other healthcare providers, as part of a specialised medical centre, in a major shopping centre or in a local shopping strip?
3. Create a marketing strategy
A good marketing strategy can help grow and maintain your patient numbers. It should focus on improving customer experience, and include ways for attracting new patients (like word of mouth referrals) while retaining existing ones (such as loyalty programs). Find out more with our article on marketing a healthcare practice.
Your marketing effort also extends to the look and feel of your waiting room. Find out more with our article on creating a positive first impression with your waiting room.
4. Choosing a location – to buy or lease your premises?
Think about your location carefully. For example, a practice built on a busy road may be highly visible to passing traffic, but does it offer your patients and staff access to non-metered parking? And if parking is limited, are you close to public transport?
Once you’ve decided on the right address for your new practice, consider the pros and cons of buying verses leasing your premises. Don’t be tempted into ‘guessing’ the numbers. Talk to a dental finance expert so that you’re properly informed about the true pricing implications of your decision.
Identifying who else is out there is important. Are there other dental practices in close proximity to where you’ll be based? If so, how will you differentiate your practice? What benefits can you offer that will encourage patients to choose your practice over your competitors?
6. Build a team of trusted advisers
A good accountant, legal adviser and a finance specialist with dental industry expertise can help take the stress out of setting up a practice that’s more likely to succeed. If you don’t already have a team of trusted advisers, ask a colleague for recommendations.
7. Structure lending appropriately
Accounting systems and processes that monitor cash flow through your practice are important, so make sure they’re set up right from the start. Talk to one of Medfin’s finance specialists to gain a better understanding of how to structure your finances to suit the needs of your practice.
During the early stages of a new practice, cash flow can be tight. What funds can you access during the initial phase of your practice? How much of your personal savings can you afford to contribute to your practice set-up and everyday expenses? Keep in mind, some finance solutions are more tax effective than others.
- Find out more about using cash flow forecasts
8. Take control and check the progress of your financial situation
Know where you need to be and what you need to be doing to maximise your income. Also, stay in control by making the commitment to regularly check the health of your finances. You can also download NAB Health’s sales forecast template and find out more with our article on budgeting for a more successful practice.
While you’re busy helping patients, don’t forget to protect your practice’s most important asset – YOU. Talk to your finance specialist about how to access healthcare insurance policies designed to protect your personal and business assets.
10. Understand your legal and compliance obligations
There are a wide range of legal obligations to consider when setting up your practice, so seek professional legal guidance to ensure you comply with all the necessary regulations.
SOME OTHER QUESTIONS TO ASK YOURSELF
Should you purchase or lease your premises?
How many car spaces will you need for patients and staff?
Is the practice easily accessible for patients?
Is there potential for growth in the surrounding area?
Is there floor space for the practice to grow into?
Do you have the finances to cover wages, advertising, stationery, licences?
Is the practice located in an easy to find location?
What are the demographics in the area you are considering?
Have the rooms been previously leased as a practice? Why did the last tenant leave?
How will you advertise your practice? Do you have contacts for referrals?
What are your staffing needs? Experience and staffing numbers should be considered.
Is there competition in the surrounding area?
Will your practice be paper based or computerised?
How much consumable stock do you need on hand?
What are your personal goals and circumstances?
Will your staff be overseeing services to your clients or will you be attending each appointment?
What type of services do your competitors offer? How will you differentiate your service offering?
What is the time frame between your Medicare claim to receipt of payment?
Will you operate as a company, trust or sole trader?
Do you need to hire additional practice management expertise?
Because we do not know your personal circumstances, you should consider whether this option is appropriate for your circumstances. Statements about future matters may not be realised and should not be relied upon. The information in this article does not constitute financial advice. Before acting on this information you should seek independent financial and taxation advice to determine its appropriateness to your objectives, financial situation and needs.