Top 7 Ways to Save Money in Your Aesthetic Practice
To increase profits in your aesthetic practice, learning where to cut your expenses is just as important as bringing in more revenue. One of the common phrases you will hear from us is that medicine is a business and we have to treat it like the business it is! Of course, we want to make every patient feel heard, understood and well taken care of, but in order to succeed, saving money is crucial to the progress of any business, and aesthetic practices are no exception.
While most aesthetic practices focus on increasing revenue, every dollar you save on expenses is a pure margin dollar. Here are some tips on how you can save money in your aesthetic practice:
Tip #1: Understand Your Credit Card Processing Fees and Negotiate Your Vendor Fees
Credit Card Processing Fees
Credit card processing fees can be a significant expense for practices. Unfortunately, many practices do not fully understand the fees associated with credit card processing. For example, they are mandatory interchange fees that are fixed by credit card companies (e.g., Visa, MasterCard, American Express, Discover). However, your merchant processor then sets additional fees such as monthly statements, transactions, and cancellation fees, and these are VERY negotiable.
In addition, using cards associated with promotions such as car rentals, hotels, airlines, or international cards can result in higher fees. On the other hand, using debit cards or credit cards without any perks or promotions saves money on fees.
In the end, don’t be afraid to ask for help from outside sources such as consultants (like us!), your banker, or a colleague in negotiating the additional fees mentioned above.
Capital Equipment and Vendors
When purchasing capital equipment, it is important to negotiate with vendors. Never take their initial offer since many vendors are commission-based, and they might not give you the best price upfront. Consider interest rates when financing the equipment. Be cautious of financing offers that offer six months of no payments, as this can result in a higher principal balance at the end of the period.
Additionally, it is important to keep track of vendor contracts. Many contracts have an automatic escalation clause, which can result in higher fees if you miss the deadline for renewal. We suggest you create a spreadsheet where you can track all of your vendors, contract expiration dates and even usernames and passwords all in one place!
Tip #2: Join Group Purchasing Organizations (GPOs) to Save Money in Your Aesthetic Practice
Joining a group purchasing organization (GPO) can help you save a considerable amount of money over time. GPOs allow you to save on everything from medical devices to office and medical supplies. Think pens, table paper, sutures, gloves, needles, syringes, and more.
It is important to research and compare GPOs to find the best fit for your practice, but once you belong to one of them, it’s basically like having access to Costco, Sam’s Club, or a BJ’s for your aesthetic practice!
Tip #3: Examine What You’re Paying for Your Current Patient Financing Program, and Look for Alternatives!
When it comes to financing programs, it’s important to take a look at the rates you’re currently paying and explore alternative options. With so many different financing providers available, each with their own unique rates and terms, it can be overwhelming to know which one is the best fit for your practice. Whether you’ve been using CareCredit, Alphaeon, Cherry, or another provider, it’s worth doing your research and comparing rates to find the best deal.
Keep in mind that some providers offer floating rates, while others have fixed rates or zero-interest options. We’re proud to have affiliates that offer patient financing at 0% APR for your patients! Don’t hesitate to schedule a free consult with our team here to get started!
Tip #4: Save Money by Utilizing Marketing Programs Offered by Your Existing Vendors
Marketing is an essential part of running a successful aesthetic practice and is another top way to save money. However, it can also be expensive, especially if you’re just starting out. This is where marketing programs offered by your existing vendors can come in handy. By taking advantage of these programs, you can save money on marketing expenses and get the support you need to grow your practice.
Some vendors may offer free marketing services or additional rebates if you meet certain criteria. Others may offer you marketing assistance through different vendors, or guidance on how to plan and execute events. By utilizing these resources, you can stretch your marketing budget and make the most of your vendor relationships.
However, before taking advantage of any marketing program, it’s important to carefully read the terms and conditions. Consider whether the benefits outweigh the costs. By choosing vendor marketing programs strategically, you can save money and grow your practice without sacrificing quality.
Tip #5: Maximize Efficiency in Your Aesthetic Practice by Automating as Much as Possible
In today’s fast-paced world, automating processes can save time and increase efficiency in your practice. Utilize EVERY OUNCE of automation in your phone system, EMR, your website, marketing and more. Phone systems like Weave offer a variety of automation options. These options include automating payment systems and sending automatic text messages to callers when you’re unable to answer the phone. You can even include a link for patients to schedule their own appointment in the text!
Appointment reminders are also a great way to save time through automation. While some people may prefer to receive a phone call, the reality is that many patients are not reachable and end up receiving a voicemail message. That is why HIPAA-compliant texting for appointment reminders is a convenient option. It ensures patients receive a reminder no matter where they are. It should include the ability to set notifications for when you want them to be reminded and the option to confirm, cancel or reschedule the appointment. By automating these processes, you can save time and provide a better patient experience.
Tip #6: Don’t Let Any Contract Go Unreviewed or Unnegotiated
In the world of business, contracts and agreements are an everyday occurrence. Negotiating and reviewing these documents is essential to ensure that you get the best possible deal. This is particularly important if you are looking for ways to save money in your aesthetic practice. Some consultants will negotiate on your behalf and take a percentage of the savings. However, if you work with a company like ours, negotiating is just part of the service, and we don’t keep any of the savings.
The key to successful negotiations is knowing who to talk to and when. Know the level of authority of the person you’re negotiating with. Don’t waste your time with the runaround, and speak with someone who is high up the chain and has the authority to negotiate to your satisfaction. Always read the fine print, and don’t be afraid to seek the help of professional negotiators and practice management consultants to ensure you get the best possible outcome.
Over the years, by working with multiple vendors and speaking at industry shows, we have gained insight into the best deals and the best time to secure them. Rather than waste time talking to someone who may not have the authority to make decisions, we go straight to the top to close deals quickly and efficiently. To have us help you negotiate your contracts and deals with vendors, schedule a free consult with our experts here!
And, to learn more about how to become a master negotiator, listen to episode 28 of Shorr Solutions: The podcast where our amazing former partner, Mara Shorr, talks about this topic in detail.
Tip #7: Analyze Your Practice’s Profit and Loss (P&L) Statements Regularly
One of the most crucial tips for running a successful practice is to regularly analyze your profit and loss (P&L) statements. Some business owners only review their statements every six months. However, that can be too infrequent to make any meaningful changes.
Ensure that your chart of accounts is accurate and your accountant is placing revenue and expenses in the proper categories. It’s recommended to analyze your P&L at least quarterly or even monthly. This is especially important if you plan to sell your business in the future. An inaccurate chart of accounts can throw everything off and potentially affect the value of your business.
Analyzing your P&L is like an architect looking at a blueprint. Make sure that your revenue and expenses are properly categorized and that your profit margins are where they should be. Taking the time to review and analyze your P&L can help you identify areas for improvement and make necessary changes to ensure the success and profitability of your business.
In addition, it’s essential to always be looking ahead and planning for the future. By staying one quarter ahead in your business plan, you can ensure that your marketing strategies and cost-saving measures are effective when you need them to be. If you need help with P&L analysis or decreasing your costs, seeking the assistance of an expert can be a smart decision. Don’t hesitate to reach out for a 30-minute free consult with our award-winning expert, Jay Shorr, to review everything in your business and make sure that you’re on the path to success.
If you would like to learn more about these top 7 ways to save money in your aesthetic practice, be sure to listen to episode 80 of Shorr Solutions: The Podcast!
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About Shorr Solutions:
Shorr Solutions is an award-winning practice management consulting company with offices in South and Central Florida. We work with aesthetic medical practices in all 50 states of the U.S. to help them strengthen the operational, financial, and administrative health of their business. With decades of industry experience, our father-daughter partners, Jay Shorr and Mara Shorr, lead our knowledgeable team of experts to assist practices in the aesthetic medical fields increase efficiency, increase revenue, and decrease their costs.
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