When I opened my practice “cold” six years ago with my partner, I had no idea what I was doing—my mantra was “fake it ‘til you make it”—because that one business class in optometry school did not prepare me well for what I was about to embark on. The only things I did know was that my partner and I were great doctors with a passion for vision therapy and rehabilitation, and we had wonderful mentors and supportive family members. I never once thought about the option of “what if this doesn’t work,” because, in my 26-year-old brain, failure was never an option.
Now, this is no straight trajectory success story; we had a lot of bumps and bruises along the way, and I would like to share three of the big “mistakes” we made so any doctor out there ready to take the plunge into opening cold can avoid these same mistakes.
Before we begin, I think it is important to highlight that my office is not a typical optometry office. We are primarily a specialty care practice that focuses on vision therapy, rehabilitation, pediatrics, and low vision. We only take three major medical insurances, one vision plan, and we do not have an optical. It is a unique practice set-up, but one that has allowed me and my partner to practice on our terms.
Mistake #1: Money on marketing
As we were preparing the office to open, we were bombarded with media outlets to “promote” our new business. We had large publication newspapers, smaller hometown newspapers, online platforms, radio and television stations, and circulars knocking on our door. As a cold start, you literally start with zero patients, so we knew we had to get the word out about what we did as well as how we were different than the local opticals, ophthalmology groups, and private practice full-scope optometrists, but we did not know what was going to give us the biggest bang for our buck.
Our mistake: Print ads
In the age of digital marketing, I do not know what we were thinking by spending tens of thousands of dollars on newspaper ads. We listened to the advice of so many people who insisted we had to do something in print. I can count on one hand how many people came in from these ads.
I will say, maybe print ads would have worked better if we had an optical and could do a welcome promotion of “bring this coupon in for 15% off your 1st pair of glasses,” but this was just not a good fit for us and proved a huge waste of precious cash flow in those early days.
My advice
Consider your market and the demographic of patients you are targeting.
Your attack on marketing will vary if you are in a hip, urban setting vs. a small-town in the Midwest. But no matter where you are: go digital.
What worked best
Contacting our local newspaper to do a story on our office opening! That article got shared so many times on social media and garnered so much interest, local support, and phone calls for appointments. This cost us nothing.
We also did a “world tour” and made appointments to see every optometrist, ophthalmologist, physical/occupational therapist, speech therapist, and healthcare provider in the area who was willing to see us. Meeting face to face, introducing ourselves, and then explaining what we did and the services we offered (with educational materials) helped to build our network of referring doctors.
“Lastly, once we started to get patients and they had a great experience, word of mouth marketing became and has since been our greatest source of patient growth.”
The investment in how we practice has had the greatest ROI!
The last thing
If you see something is not working, stop it sooner than later. We kept with the print ads for longer than we should have because we were told “to stick with it” when we knew it was not working, and we did not have the confidence to go against this advice.
Mistake #2: “Stealing”
One of my mentors told me "if you think someone is not stealing from you, then you are not looking close enough." Firsthand experience: I can tell you that this is true.
Now the “stealing” we experienced was not due to “sticky fingers,” but rather stealing from us in terms of time, inefficiency, and lack of productivity. In my opinion, this is worse.
Our mistake: Trusting employees blindly
Hear me out: Having just opened a business, we were spending so much time and energy building that business, pouring ourselves into our patients, and trying to be the best doctors we could be that we started to delegate tasks to staff as we got busier. And, we just assumed those tasks were being done. We made the mistake of working “in” the business and making no time to work “on” the business (check out The E-Myth by Michael Gerber for more about this “in” vs “on” your business discussion).
One area where we lost an incredible amount of money and where I feel like we were “stolen” from was with our in-house biller; she was simply not doing her job. There were so many red flags, but my tip-off was a slowdown in cash flow. I could not understand how we were busier than we had ever been, and somehow things were tight.
We discovered for the few insurances we take, she was not submitting things accurately or in a timely manner. Also, she was not collecting co-pays at time of service—“I’ll send you a bill” was a common phrase out front. And, before we knew it, our insurance and patient receivables was SKY HIGH. Like, I literally fell out of my seat, high.
“As you know, if you are outside of timely filing with insurance, there is nothing you can do; we basically gave away care for free.”
The patient receivables were also so hard to manage because we found it is incredibly difficult to get payments retroactively. People ignore your bills and phone calls when you try to discuss the money they owe.
We also ran into some of the insurances that we do take not covering vision therapy for whatever reason, and because of the lag of submitting to insurance, the patient was often ¾ of the way through their program before we realized the issue. Although the patient was technically liable for payment, they were unhappy they were not alerted sooner, and we ended up discounting things for them.
My advice
Create a check and balance system within your office.
I am not advocating for micro-managing; to grow, you must delegate tasks and trust that people can do their jobs. What I am advocating for is creating a way to make sure things are getting done properly by checking in on them periodically.
What worked for us
We created systems:
- Billing is reviewed daily before the doctor leaves.
- Patient receivable reports are run monthly with bills being sent out.
- We use a collection agency when necessary.
- Insurance receivables are run monthly as well, so we can catch any egregious errors or issues.
The last thing
My partner and I blamed a lot of this one on ourselves—we should have caught it sooner. We were busy “doctoring” and just did not have a pulse on the heartbeat of the practice, and, in turn, we were “stolen” from in terms of time and money.
Mistake #3: Not understanding cash flow
When we opened the office, we hired a phenomenal lawyer, a reliable IT person, and got ourselves a reputable accountant. Those three things (the law, IT, and accounting) neither my partner nor I had any experience or expertise in and relied on the professionals to help guide us.
Our accountant set up our QuickBooks account and offered to do our bookkeeping services for us. We thought, “Great! One less thing we have to learn.” It was sort of "out of sight of out of mind" in the beginning.
Our mistake: Not learning the basics of accounting
Well, let me tell you—this is by far the biggest mistake we made. The issues we experienced with billing and insurance would have been caught sooner (among a lot of other “little things”) had I been more aware of the day-to-day cash in/cash out of the practice. I’m slightly embarrassed to admit this, but when we first opened, we had a line of credit that acted as our buffer to cover costs.
When we started to get busy, I just saw money in the bank account and thought things were rolling “okay.” I always checked in on the finances, but everything was a little bit delayed because the bookkeeper would wait until our statements closed to do our books. And, because we were a smaller client, it wasn't the top priority for them to get our books done quickly. I always felt like we were behind a month (if not more) on the “snapshot” of our office.
My advice
Do your own bookkeeping.
Yes, you are an optometrist by training, but as a small business owner, you are going to wear many hats—so I suggest you get comfortable wearing this one. Once you are established, this is something that you may be able to delegate, but I encourage you to have a better check/balance system than we did initially.
What worked for us
I took over the accounting for the practice. A good friend of mine is an accountant, and she gave me a crash course in Quickbooks. After a few sessions—by the way, it is so easy to use—I hit the ground running. For a few months, I had her check in to make sure I was entering things properly, until I felt confident in my understanding of the program. I am aware not everyone has access to their own personal accountant friend, but there are tons of QuickBooks courses that anyone can take to learn the basics.
The last thing
Do not be afraid to ask for help in this area! You would be surprised at how willing people are to help you. I call my accountant if I do not know how to code something, and we check in with him frequently on how things are going just to make sure we are making smart decisions financially.
The very last, last thing
I will leave you with this: give yourself some grace when you are opening your practice; you will make mistakes!
“It is not about making the mistake, but more about how you respond to them that makes you a better business owner.”
Remember to take a deep breath, learn from each experience, and try not to make the same mistake twice!
