When I first opened my business, I wanted to make a difference, I had a passion and unstoppable energy to make a difference my way and create something that my family and the health care industry could be proud of.
Then I had to go get a loan, and what did the bank ask me?….. “What will be your profitability?”
Building a business plan to show that we could earn more than we could spend was the easy part. Running a health care business that actually does so….well, that’s the challenge for most of us.
Early in 2020, I sat in on a fireside chat with a popular Toronto entrepreneur who grew a chain of restaurants. His motto was three words: PASSION, PEOPLE, PROFITS.
Typically, when a clinic owner decides to stop practicing, we see one of a few possibilities. He/she is forced to sell the clinic at a significant discount, rarely getting a return on their ‘sweat equity.’ The new owner then changes the business model to guess what? Become more profitable! But in this case, the business is changed according to their values, not those of the original owners’. Decades of practice and the clinic owner ended up created a job for him/herself instead of an actual profitable business.
Well, that’s not good enough for me. I want my legacy to live on. I want my brand to continue without me. With time, people die, but a profitable business?It can only become more valuable!
Profits are not bad! It is shortsighted to operate without profits.
When customers/clients/patients continue to visit your business that means the service, product, and quality you are offering is outstanding. When you can optimize your business so that there is surplus left in the bank, that means the job you are doing as a business owner is outstanding. Profits are the measure of a business’ success. Revenue without profits is a bandaid solution. Let’s say, for all you rehab professionals, it is similar to giving pain meds instead of teaching exercises and lifestyle habits. Your job as the clinic owner is maximizing your passion into profits.
Profit does a lot of good!
Profits help us:
– Pay off bank loans and obtain new bank loans! Profitability improves the business owner’s credit score and lending ability. Until a business is making profits, the business is seen as a liability, not an asset.
– Invest in new people, systems, culture, ideas that can benefit their customers, employees and scale the business.
– Support the economy (I don’t know about where you’re from, but the Canadian government earns income through taxes off PROFITS!)
– Be the mark of your success as a business owner.
– Survive recessions or downturns in the economy.
– Stay relevant and be admired!
As a private practice owner, the best way to determine the outcome of your passion is through your profits. The way to your profits is through your people. A mistake we have made in our company in the past is to not share the importance of profits with the people within our company. As a health care provider, I was raised to believe that any talk about money or making money was dirty…
Finally, we have learned to reward profits! When profits are good, treat your employees with bonuses, gifts, and a kickass Xmas party. When profits are not good, discuss with your team how they can all help the company get there. And don’t forget to reward yourself! This is a never-ending balancing act of understanding people (both within your company and your clients), creating a relevant business, and pursuing your passion!