00:00:04:07 – 00:01:36:00
Welcome to Shorr Solutions: The Podcast. I’m your host, Jay Shorr. I’m the CEO and founder of Shorr Solutions, a national and award-winning consulting firm, assisting aesthetic and surgical practices with their operational, administrative and financial success. I have an amazing team of practice management experts and clients across the U.S. and as an industry expert with firsthand experience owning a multimillion dollar cosmetic dermatology and plastic surgery practice.
Listen in as I’ll lend you my expertise and best tips to successfully manage and grow your aesthetic practice. I will also be bringing in guests along the way, so get ready to be equipped to operate your aesthetic practice strategically and profitably. Welcome to Shorr Solutions: The Podcast.
Hello and welcome to another edition of Shorr Solutions: The Podcast. I’m your host, Jay Shorr. I am the founder and CEO of Shorr Solutions, an award-winning national practice management consulting firm specializing in the operational, administrative and financial health of your aesthetic, cosmetic and surgical practice. Today, we are going to speak about the top seven ways that you can save money in your aesthetic practice. The first question that I want to ask you is, is your gas tank full or are you running on empty, or don’t you know the answer to that?
00:01:36:19 – 00:02:17:14
Every practice that we work with, inclusive of my former practice, loves to save money. Let me share something with you. Everybody focuses on revenue, and revenue is great, but every dollar of revenue that you bring in, you may only be making the margin, net profit, EBITDA or whatever acronym you want to call it. You may only be making $0.15, $0.20, $0.30, $0.35 on the dollar revenue, but if we can help you and you can help to save your expenses, that every dollar that you save on your expenses is a pure margin dollar. So let’s get to how we can actually end up saving money.
00:02:18:00 – 00:06:38:24
So let’s go through tip number one. One of the first things that I always ask everybody is, do you know what you’re paying for for your credit card processing? And everybody gives me the same answer. Of course, I know. But I can almost guarantee you that they think they know and they really don’t, because there are so many fees associated with credit card processing.
And I’m not going to bore you with all the terminology. However, what many of you don’t know is that if you don’t actually swipe or chip the card, your fees are going to be higher. If you use or the patient use a card associated with any type of a point and perk, promotion car rentals, hotels, airlines, then that’s going to be a higher fee for you.
And then if it’s an international card or a business card, it’s going to be even higher, yet. If you have to manually punch it in, then that’s an even higher fee, yet. The less expensive card to process, A: is a debit card because it’s directly debited from the patient’s account, or a credit card that is not associated with any points, perks or promotion.
Secondly, review contracts when they’re due. Like, I’ll give you an example. Biomedical, hazardous waste. Do you actually know when your vendors contracts expire? Well, what you should do is have some kind of a spreadsheet that you can diary when the actual contracts expire because many contracts actually will self-renew. Now, you may read that when you first execute the agreement, but you may not know it when it comes time that you may have 30, 60, 90 days.
And if you don’t, it automatically will renew. And what you may not realize is that there’s an automatic escalation clause, kind of like a lease. It may go up 3% a year or it might be capped at 5% a year. But make sure that you really understand that. Now, when it comes time to purchase capital equipment, please don’t accept the first proposed offer.
I can’t share with you enough how many deals I negotiate for capital equipment. Now, I have nothing against our wonderful vendors. We live and we love our vendors, but we love to hate our vendors as well. Many of our vendors are commission based, so they’re not necessarily going to give you the best price right up front. And then, of course, you may hear there’s a show special or there’s an end of the quarter special.
And the reason for that, if it’s an end of the quarter, is that they have to show shareholders or stockholders or whatever that they’re actually making the profit. Make sure that you are properly negotiating it and it just doesn’t come with the actual fee or investment that you’re paying for the equipment. But also, if you have to finance it, what is your current interest rates?
Now, interest rates today aren’t like they were one and two years ago because the interest rate from the federal government is high. Therefore, making secondary lenders or banks a higher interest rate, yet. The least expensive type of a loan that you can take can be a line of credit where you may only have to pay interest only. But let me try and share something with you.
When a vendor tries to promote a specific vendor to lend you money, ensure that that vendor doesn’t have their hand in the pocket, that they’re being commissioned or compensated from, the lender. Instead, remunerating that discount back to you instead of it going to them. Secondly, with negotiating of a bank or financing, try to stay away from the six months of no payments.
It didn’t say six months of free interest. It meant six months of no payments. So on that seventh month, your actual principal is going to be higher than your original principal because they’re backing all the interest that you didn’t pay, now, into the new balance as you start on your seventh month. So be very, very careful when you’re trying to negotiate.
00:06:39:00 – 00:07:43:29
Tip number two, try to join purchasing groups. Group purchasing organizations. It’s kind of like Costco, Sam’s Club, BJ’s. It allows you to save everything from medical devices to office and medical supplies. Think table, paper, sutures, gloves, needles, syringes, and the reason that it is less of an investment is because if they’re in a group purchasing organization, you may not have enough of the buying power to offer or to make a difference.
So you’re going to pay top tier. But if you’re a member of the GPO group purchasing organization, you will get the benefit of the pricing of the group.
00:07:43:30 – 00:08:38:17
Number three, examine what you’re paying for your current financing program for your patient finance, and look for alternatives to reduce those rates. Now, you’ve all heard of CareCredit Patient5, ALPHAEON, Cherry, all right, CreditCards.com.
And if you notice, I’m not naming just one, I am naming all of them. Some may have floating rates. Some may have fixed rates. There’s a different rate for 6, 12, 18, 24 months. There’s a special rate for zero interest to the patient, yet, you as the practitioner have to pay. We have all kinds of patient financing that we represent that are the least in the industry.
So feel free to ask us. This is not a promotion for us to sell you anything. It’s just an idea to allow you to know that there are multiple options out there.
00:08:38:18 – 00:09:39:16
Tip number four: Utilize marketing programs offered by your existing vendors. This can include anything from reimbursement and incentives for end of quarter quotas before paying for everything out of your pocket.
Utilizing marketing programs means that if you order X by a certain period Y, they will offer you X amount of dollars of free marketing, or they may offer you additional rebates that you can use towards marketing, or they may offer you marketing assistance through different vendors. How to put on an event, how to have additional guidance, how to have practice management consulting, because there are companies out there that will pay the vendors in order to assist you.
But I want to share something with you. It doesn’t come without a cost because somebody ends up having to pay for that.
00:09:39:16 – 00:11:06:11
Yes. We’re going to take a quick break and a slight intermission, because what kind of business would we be if we didn’t tell you about our own services? I’d like to take a moment to tell you about our conversion cascade online course.
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It only takes less than 4 hours to complete the course. You can finish it at your own pace and you’ll have lifetime access. And as a special thank you for our podcast listeners, we’re giving you a 20% off discount. Just enter the Code PODCAST to start saving. Click the link in our show notes to sign up for the conversion Cascade Online course and convert more patients. Now.
Tip #5: Maximize Efficiency in Your Medical Practice: Automating Your Phone System, Appointment Reminders, and more!
00:11:06:15 – 00:13:26:22
tip number five, automate, automate and automate. Use every ounce of automation in your phone system. EMR practice management, your website, vendors and more. There are phone systems out there, Weave, for example, that allows you to automate your payment systems, allows that if you don’t answer the phone, they get a quick message back to the caller. There’s so many different things with phone systems.
There’s so many different things with your practice management software, for appointment reminders. This saves time. Now, I know a lot of you might say, “I don’t really like when I have to have an automation or a text. I’d rather call”, but one thing I could probably tell you, you’re probably not reaching for the most part, you’re probably not reaching the patient anyway, and you have to leave a voicemail message.
I believe, and I never used to believe this. I believe that texting for appointment reminders is great. Why? Because no matter where I am, I get that appointment reminder. Now, when I personally leave a physician’s office or a specialist office, I don’t ask for the card. They tell me when my next appointment is and I put it in my mobile device, my iPhone, your Android, whatever that might be.
That to me is better because you can set it for when you want to be notified. In addition to that, I may get a text message from the provider, whether it’s three days, two days, the day before the day of and in the very beginning, when you get it several days ahead, it will give you the options, one to confirm, two to cancel, three to reschedule, or whatever their system is.
I love that. My number one, what it does, it reminds me, because we all are working on such busy schedules, busy schedules, both personally and professionally, that allows us to regroup and maybe even cancel that appointment to reschedule it if we have to. Very, very important. Try to do everything. Automate it the best way that you can.
00:13:26:27 – 00:15:44:05
Don’t let any contractual agreement go on, reviewed or negotiated. The worst that can happen to you is that you get the deal that you negotiated. What’s so wrong with that? We negotiate contracts and agreements each and every day for our clients and prospective clients. There are several ways to do that. Some people, some consultants will negotiate something for you and take a percentage of the savings. US, for example, if you are a client of ours, that’s just part of your program and we don’t keep any of the savings.
But what we do know in working with multiple vendors throughout the industry and since we are key opinion leaders and we attend so many shows, we know what the best deals are and the best time to get those deals. So, we’ll go straight to the decision makers rather than having to go to somebody who may not be able to make that decision.
These are the car dealers. You know, when you don’t want to buy that car right away, they go to the next chain and the next level of authority and to the next level of authority. I prefer to go to the top level of authority. And I already know when we’re negotiating on behalf of the client, what is the bottom line that you’re willing to go so that when we go to the decision maker, this is our bottom line and we don’t want to play the game and allow that vendor to spend their time on cultivating the lead generation from a new prospect instead of having to keep trying to drum that business from you when
we can assist you in closing that deal. So always you go negotiate it and please read the fine print because the next time that you’re going to go back to that contract after you’ve signed it, is when there’s a problem. There’s never a need to go back to the contract if everything is going too Sweet, Kosher, the best way that you thought it was negotiated.
So look at all the fine print. Professional negotiators and practice management consultants already know most of these agreements and can help you to the best of your advantage.
00:15:44:06 – 00:18:00:18
Tip number seven Analyze your profit and loss statements on a regular basis. Some people tell me they do it every six months. You can’t do anything about it if you’re only looking at it six months.
So I suggest at a minimum, and I mean at a minimum is every quarter we analyze P&Ls every month, making sure that your chart of accounts is proper, making sure that your accountant is placing the revenue and the expenses in the proper categories. There’s several reasons for that, because in the event you ever want to sell one day, if your chart of accounts or your categories are all skewed, it can throw everything off, even if the bottom line is going to be identical because a buyer is going to know how much money can they make and what revenue sources are generally getting the revenue.
When I analyze a P&L, it’s like an architect looking at a blueprint. So it makes it very easy because I want to know that you are making you have a 100% markup with a 50% net margin on your skin care products. And I’ve seen so many times where the expense on the skin care product is about 75% of the revenue.
Something’s wrong or it’s miscategorized. Maybe it all depends on whether or not you are on a cash or an accrual basis. Cash meaning is when you pay for it. Accrual means divide it out throughout the course of the year so that it is generalized when you’re taking the expense, there’s so many more different ways. So those are your seven tips.
Now, do you need help decreasing your costs or do you need an expert? profit and loss analysis? We can help you. Link to schedule for your free consult in description. I will probably be the one that will help you. My team will assist me and there is no fault in ever trying to just review everything in your business.
Review it. When you do your business plan, you should already be one quarter ahead in creating your business plan because the results of what you’re getting today is a result of what you marketed and your business plan from a minimum of three months ago. So if we’re going to try to help decrease cost and have a marketing program, you have to start it now so that the results are going to be effective 3 to 6 months from now.
00:18:00:27 – 00:19:48:22
Ladies and gentlemen, thank you for spending a short amount of time with me. Good luck and God bless. So that wraps up today’s episode of Shorr Solutions: The Podcast. If we mentioned any website links, you can find them in our show notes to work directly with me and our award winning team of consultants to increase efficiency, increase revenue and decrease costs in your aesthetic practice.
Schedule a free consult with us today. We will help you establish and refine your esthetic practices protocols for maximum efficiency and productivity, decrease your expenses and increase your profitability with an expert financial analysis of your business. Attract more patients, convert calls to consults, convert consults to treatments, and keep patients coming back for more. With our sales training, coaching and complimentary access to our conversion cascade online course recruit, hire and train new team members and manage any staff turnover with our human resource expertise plus more.
Head over to our shownotes and click on the link to schedule a free 30-minute consult with us today. And if you enjoyed today’s episode, don’t forget to spread the word and share this episode with your friends, colleagues and the rest of your team. Remember to also follow us on social media @ShorrSolutions and sign up for our newsletter.
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