VetBilling Case Study #1:
How to avoid the five reasons businesses fail and how overcoming these reasons will positively impact your practice.
How is it possible to significantly increase cash flow when your practice’s margins are squeezed from all sides? Increasing expenses, competition from online pharmacies, pop-up vaccine clinics…even though client visits are booming, your bottom line might not be. Can businesses fail even when they have more customers than they can handle? Yes they can, especially if they aren’t keeping costs under control and continuously innovating to keep up with what their customers wants and needs.
While there isn’t one perfect solution for bomb-proofing your practice, you can chart a course toward stability by steering away from the most common reasons that businesses fail…
Businesses come and go according to a Forbes article, “5 Reasons 8 Out of 10 Businesses Fail.” Author Eric Wagner notes that 80% of businesses fail within 18 months of opening…a sobering statistic.”
By understanding these five reasons businesses fail, the practice in our case study was able to avoid these pitfalls and is thriving.
The first reason a business fails, is the business owner is not really in touch with customers through deep dialogue. Use whatever means your customers are most comfortable with but you need to communicate. That may turn out to be that lost art of face to face conversation. Our case study practice understands this and communicates upfront with the client if there is a financial concern.
The second reason, there is nothing differentiating you’re business in the market. Entrepreneurs that take this lightly end up in trouble. What differentiates you from your competition? You have the cleanest practice, the friendliest staff and the best doctors but how do you communicate that to a new client that has not been to your practice? Sorry but you can’t. You have to bring them in by communicating what they can relate to and money is the biggest relational element there is. This practice understands if you can relate to your clients where they are financially it will be a win-win.
The third reason, the failure to communicate value propositions in clear, concise and compelling fashion. You can have the best practice, but if you do not know how to communicate that, you will fail. As stated in number one, learn to communicate in real dialogue not monologue. Be clear, concise and compelling. Talk their language and listen to the words they use and state them right back to them. This practice knows before the client goes back into the treatment room if there may be some financial limitations so they can tailor the treatment plan so the client will say yes.
The fourth reason, leadership breaks down at the top. There is a lot of self-sabotage through poor decisions and weak leadership skills. Entrepreneurs that succeed spend time with personal development. Are you stuck in your old ways? Do you not want to listen to the younger generations? Give this some real thought and you may open your eyes to some great new ideas. The case study practice has leadership at the top that listens to it’s team members and its clients.
The fifth reason, the inability to nail a profitable business model with a proven revenue stream. What kind of recurring revenue stream do you have to sustain your practice? If you have a slow month or two, do you have enough cash in the bank or a recurring revenue stream to pay the bills? By having a professionally managed payment solution system this practice avoided a cash flow drop from month to month.
All five of these reasons why businesses fail are why you need to rethink your business model when it comes to getting more paying clients in the door. Do you really listen to your clients when they hesitate about the cost? Maybe they just had to pay a lot of money to fix their car and it depleted their savings. Are they really saying they cannot pay, or are they saying they can pay but not all at once?
How do you differentiate yourself from your competition? You cannot sell that you are a better surgeon; pet owners have nothing to compare that to. You need to differentiate your practice in ways that pet owners can equate value to. Offering payment options is how a pet owner can see what makes you different from the practice down the street that requires payment in full. Helping the pet owner pay helps the pet, which in turn creates gratitude.
How do you communicate value? Again, you cannot sell that you are better at xyz; pet owners have nothing to compare it too. You can offer payment options that your competition is not offering; something a client can relate to and put a value on, the money in their pocket.
What is your proven revenue stream? With wages (adjusted for inflation) only rising by 3% since the 1970’s and more than 50% of consumers having less than $1000 in savings, how do you expect your clients to pay in full for every treatment plan? Enabling your clients to pay overtime via payment plans, prepayment plans, wellness plans or pet savings accounts will create that recurring revenue stream.
See our Case Study #1 results below to discover how one of our clients overcame the problem of having to turn away more and more clients because clients could not afford to pay in full at time of service. The practice has overcome every one of these five reasons businesses fail to help them become more successful. By offering payment options you WILL increase new client visits, retain existing clients, increase cash flow and increase staff morale.
VetBillingCaseStudy 1 – 2020