With any kind of business, there are risks and potential financial blunders. Chiropractors have their own unique challenges along with the usual “normal” business problems. Let’s explore the top five biggest money mistakes a chiropractic office can make.
I detest budgets. In my next life I’m going to be independently wealthy or a trust fund kid. When it comes to spending money on things, I’m about as American as you can get. Through trial and error (and lots of error), I’ve come to learn the value of having budgets. There is freedom in having less debt and more cash on hand. A rich guy told me once, cash is what can buy you options. The more options you have, the more freedom a person has. I think the budget for a chiropractic office from the get-go is so important, because most new chiropractor are swimming in student loans. The last time I checked, chiropractors still don’t qualify for loan forgiveness through any US government agencies like “Doctors without Borders,” “The Peace Corp” or working in under-served areas in cities. Unless you have a bunch of greenbacks stashed under your mattress to help supplement cash flow during the lean times, it’s important to squirrel away as much as possible.
A couple sub-categories I would like to touch on would include keeping credit cards low, not taking out anymore big loans, hiring too soon and keeping overhead as low as possible.
Entrepreneurs are the dreamers and creators of the world. Small business owners take on a huge amount of risk and liability, sometimes struggling for many years, can put themselves in financial peril but the rewards can be so great. Financial freedom, more time, a schedule you like and the potential to contribute more to the world. Entrepreneurs don’t like being the cogs in someone else’s machine. The flip side is, it can be easier to get caught up in the glitz and glam of small business before success has truly kicked in. Spending too much money too soon, too much overhead, payroll fancy buildings or cars can all become huge burdens. Just like with anything in life, businesses seem to be their own living, breathing entities. As such, it can take longer and be a much more arduous road to sow compared to pie charts, projections and snappy excel sheets. Running a business is a marathon not a sprint so, keeping expectations in check and reasonable will make the venture a little smoother.
Spending your money on gaining more knowledge and finding a niche will potentially add more value to the business in the future. The more specialized you become, the more money you can charge for services. Gaining more knowledge is money well spent.
Making sure from a malpractice perspective, umbrella insurance, disability and/or any other insurances have enough coverage. For example, I have a one million/ three million occurrence policy with up to three occurrences/ year. I know in the States, you have to have malpractice coverage in order to accept insurance. In our litigious society, I could not imagine not having proper coverage. Add this necessary evil to your budget!
Another important part of the budget would be to add in professionals when the practice and budget grows. The first person I ever hired was an accountant. I worked it out with him so as a new business I paid less in the beginning than I do now. A great accountant can shield you from more legal liabilities, not overpaying in taxes, budgeting, setting up business “flow throughs.” As the budget expands, adding in other professionals for marketing, etc will help you be more productive as the business owner, see more patients and then allowing mental space to continue to grow the business.
Kassandra Schultz DC