Set up the right business structure for your practice
BY CHRIS FAUL
No matter how one may want to strip down and analyse the challenges relating to the business side of the optometric practice, it always reverts back to having the right information, in the right format, at the right time.
It is true that there is a tendency among health care professionals to abscond from the financial management of the business, but I just don’t see how you can run a business effectively, without the right information at hand. The old convention of meeting with the auditors for a business review, some months after year-end in February, is just so old! It is fruitless to reflect on a business calendar, that stretches back some fifteen months. By then the horse had already bolted.
The key to creating a high-performance practice is to set up effective business structures, which will enable the optometrist to fly the business like a kite – as easy as that. What you need, are a few relatively simple structures in place.
It all starts with a business plan, which should be reviewed annually. Change your financial year-end to July or August, the quiet time of the year, when there is more free time to review your financial results and set up your business plan.
A budget and a forecast are required so that you have something to aim at and measure your progress.
A policy and procedure manual and a training manual will also serve you well. Financial management accounts, in a format you can relate to, should be on your desk by the 10 th of the month. In fact, a summary of the Income Statement, which I call the Mini Income Statement will suffice.
This may beg the question how? The problem is that no optometric software package in South Africa has an integrated accounting system. That is until now. Humint O has just been launched, a paperless online software package for optometry that incorporates an accounting package. It comes with all the bells and whistles one can imagine and it is well priced.
I once surveyed a room of over one hundred optometrists. They were asked what their net profit was the previous financial year. To my amazement, seventy-four percent of them did not know what percentage of net profit before tax, they achieved the previous financial year. Do you? This suggested that they do not have the right structures in place, that can place the right information, in the right format at their fingertips at the right time.