Tag: location

Location. Tips on Getting it Right!

Finance|Wealth, Office Design & Renovation, Practice, Real Estate

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The location you pick for your practice is one the most critical business decisions you will make, and for new practices which rely on attracting new patients, will determine how quickly you reach profitability or even survive.  Here is a list of things to consider.

  • Awareness of your brand is critical to building the initial trial visit which ideally will lead to repeat visits throughout the years. Pick a location which is highly visible to thousands of consumers each week. Real estate with good traffic generators like grocery stores, liquor stores, drug stores, popular restaurants/pubs or big box retail like Wal-Mart, Canadian Tire, Winners, Marshalls, Home Depot etc. The highest volume optical stores in Canada are located in the large regional enclosed malls which provide huge flows of walk-by traffic. Occupancy costs are much higher so these practices must generate very high sales to survive.
  • Ease of access is very important. Most people do not casually visit an optical practice and in fact regard it as an expensive chore, so you want your store on the path of their normal round of weekly or monthly shopping.
  • Mature markets with established practices and loyal patients will be much tougher to penetrate than an area that is growing with new consumers looking for a new service provider.
  • Another key market dynamic is the type of competition. Some markets may have a competitor selling designer frames at close to cost, a battle you will inevitably be drawn into if you locate there. Conversely your research may reveal that the established operators are out of touch with the market and or give poor service, which spells opportunity.
  • Use an experienced retail agent if you can find one. Many real estate (residential) agents will take your business without being able to add any real value. Ask the prospective agent to list the specific retail deals they have done. A good agent will know listed and unlisted vacancies, and importantly what kind of deal is possible with a given landlord. The agent’s fees are generally paid by the landlord.
  • Understand that Optometry/optical stores are one of the best tenants a shopping centre can have. It is a clean, unobtrusive, attractive use, does not use a lot of parking and is likely to generate a good revenue stream for years.
  • Buying versus leasing. It’s great if your occupancy costs can go towards buying a location, but most of these are residential homes zoned for retail, condo ground floors, or commercial condos. These may work if you have a well-established practice, but unlikely to have the traffic necessary to build a business very quickly.
  • Don’t get sucked into taking a space larger than you need, the smaller and more efficient a space the better. Occupancy costs are a fixed expense and can crater your income for the life of the lease if they are out of line.

Recognize that a well-established visible location in productive real estate is one of the biggest drivers of your practice’s value. Take your time planning for it, finding it and negotiating for it.

TOM BOLLUM

Tom Bollum was the founder and CEO of Eye Masters Canada (sold to Lenscrafters) and has held senior management positions in New Look Lunetterie and other optical companies before joining the Avison Young Commercial Real Estate Brokerage retail practice. He has sourced and negotiated locations for many optical stores across Canada.

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Location, Location, Location

Buying-Selling A Practice, Finance|Wealth, Office Design & Renovation, Practice, Real Estate, Resources

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We are often approached by ODs who are looking for help to open a new practice. One of the first questions asked – either by the client or by us! – is where? When you are investing a quarter of a million dollars, and often more in construction, it is crucial to get this right. The right location can be the difference between making a profit in the first year or not until the third year, or even later.

Our first recommendation is to think outside the box. While it may be tempting to gravitate to the larger cities because of the denser population, remember that these areas are also the most competitive. They have lots of choice and can choose an experience or service provider that caters best to their particular needs. Strong differentiation in terms of both product offerings and service becomes key for success. Conversely, a smaller, more remote location will allow a more general practice strategy. However, in today’s digital world, it is still critical to create an experience that patients will want to support whether you are in an urban or rural setting.

After determining what will set your new clinic apart, and whether you are going to set up in a larger or smaller community, the next step is to find the physical location that will support your strategy. Commissioning a Geo-marketing Report is the best way to accomplish this. They are produced by non-stakeholders. This tool will compile and analyse the best available data for a given geographical area of interest. Some data taken into account includes competitor information and population demographics for that area, such as age, income level, ethnicity and education level. This data is then matched with your clinic strategy. Ultimately, this will provide you with a consensus report that can pinpoint the ideal location for your new business.

Lastly, your business strategy will also dictate what part of a building you should set up your business in. If you are setting up a primary care practice that will be dependent on optical sales for 50-60% of your revenue, it is imperative that you have street access, visibility and plenty of parking.

Remember to think like a consumer as you make these decisions. The days are gone where patients want to buy glasses from a small selection from an office buried at the back of a medical building. Consumers are gravitating to a different experience, as evidenced by the wildly popular new optical stores popping up all over Canada. A new business owner must rise to the challenge and spend time finding the ideal location for their new practice.

 

CHRISTINA FERRARI

is the co-founder and managing partner of Simple Innovative Management Ideas (SIMI) Inc. and expert Practice Management contributor for Optik magazine. She can be reached at info@simiinc.com

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Plan How You Shop for New Office Space

Finance|Wealth, Office Design & Renovation, Practice, Real Estate, Resources

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Shopping for office space is like shopping for a house. It is easy to get distracted by first impressions. A beautiful, bright space is tempting, but will renting or purchasing the space give your practice what you need to grow? My practice recently made a move to a new space. Here is how I connected my strategic goals for my practice to the new space we found.

Match Patient Volume to Space

Our old space had distinct limitations. It was less than 900 square feet, far too small for the more than 3,000 patients we see each year. We also lacked prominent street-front views of the office, so people could not see us from the road. Including the doctor that I bought the practice from, we had been in that space for over 30 years, and still people in the neighborhood did not know we were there. We were only attracting one demographic, and we wanted to have a more diverse population of patients.

The well-trafficked corner in West Palm Beach, Fla., where Dr. Jasper moved her practice, Advanced Eyecare Specialists.

To retain patients, we limited our scope of searching to less than five miles. We didn’t want to inconvenience existing patients, so we ended up choosing a space less than .5 miles away from our old space, and yet we already have seen a large increase in new patients.

Location, Location, Location

Location is key. I really think you need patients and prospective patients to have an easy-to-see street-front view of your practice. People need to see you as they drive by. If they pass your sign daily, they will think of you when the time comes for eyecare and new eyewear. You need a good sign and good logo that is easy to see from the road to maximize the potential of your location. I have many friends that are successful in business centers with no prominent street-front view, and I am happy for them, but I suspect they would be even more successful if patients could see them more easily.

We chose our location because it is on a street corner that has 26,000 cars drive by daily, according to a feasibility study of the location that we conducted prior to signing the lease. We also chose it because it had the availability to have a very large sign on the corner with our name on it.

Patient Convenience

We currently have eight staff members, so we needed space for those eight cars, plus space for patient cars, and will need more space as the practice grows. We knew we had to have parking or patients would be discouraged from shopping in our dispensary. Our city of West Palm Beach, Fla., does not have much public transportation, so parking matters. We also wanted to find a location close to neighborhoods. We find that our patients like to see a doctor close to home and we wanted to find a location close to their homes. We have people who come to see us from many miles away, but the majority of our patients are moms bringing the family who are from the neighborhood immediately surrounding the office.

Announce Relocation with Bold Statement on Practice Web Site

I knew many patients would visit our web site before making their appointment, so I made sure our site featured the following announcement of our move:

“We’ve MOVED!
Since 1941 we have been serving our patients in West Palm Beach. As of January 3, 2012, we’re proud to announce that we have moved to a newer, larger facility just three blocks away so we can better serve YOU! Please give us a call for directions before your next visit.“

Think Long-Term Growth

The large, enhanced optical shop featured at the new location of Advanced Eyecare Specialists.

We thought in terms of the long run when choosing our space. We knew that in our old space we would be limited in the number of patients we could see and would not be able to bring in a second doctor without a second and third exam room. It isn’t cheap to expand, but we also knew that with upcoming changes in medical care resulting from health care reform, we needed to be prepared to adapt to change.

Renting Is OK, Too

Purchasing an office space that can become a long-term investment is the ideal, but sometimes it is not possible. In our case, we rented this space we just moved into after searching for a location we could buy for two years unsuccessfully. Our lease is for five years. It typically takes 10 years to recoup the costs associated with moving, so prepare to stay put for a while following your relocation.

Compare What You Have to What You Would Be Getting

The optical in our new space is five times as big and has twice the number of frames and higher-end frames as our old space. We still have the same number of chairs In the optical, but our goal was more shopping space, not seating space. We now have a pre-testing area as well as a separate room for special testing so we can maximize our ability to move patients through the office quickly. We also were able to purchase more instrumentation for better patient care. We now have three exam lanes fully automated with Marco TRS systems, and the entire office uses electronic health records for maximum efficiency.

Delegate Search but Devote Time to Looking

A doctor with a full patient load probably will have difficulty setting aside the needed time to conscientiously shop for office space. In my case, I turned over much of the detailed searching to my husband, who also happens to be my practice’s business manager. We looked at more than 20 locations over a period of two years before making our final selection.

Don’t Forget: Office Space Must Enhance Patient Experience

You can have all the best instrumentation and best looking office and great selection of frames, but when the patients start coming into the office, the experience also has to be amazing. The beauty of the new space is that we have been able to create systems and efficiencies that make the patient experience one that they will want to return for. At the end of his exam, one of my patients recently said to me: “Dr Jasper, the office is beautiful, and the staff is amazing. The experience you have given me today well justifies the fee you charge.” That is what we strive for every day, and the new office has made that even more of a reality. To give our patients time to adjust to the new location, we kept our fees the same for the first six months following the move and then raised fees by $40. Happily, the majority of our patients have made the move with us.

 

APRIL L. JASPER, OD, FAAO

April L. Jasper, OD, FAAO, is the owner of Advanced Eyecare Specialists in West Palm Beach, Fla. She is featured in a cover story in the Spring 2012 issue of MBA Insights. To contact her: drjasper@aeswpb.com.

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Location, Location, Location: Start Me Up Webinar Part One

Buying-Selling A Practice, Finance|Wealth, Practice, Real Estate, Resources, Webinar

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Location is arguably one of the most important decisions that can make or break the success of your new practice. The following conversation among independent OD offices that have been recently establish is excerpted from the Start Me Up Webinar Panel hosted by Jeff and Tina Goodhew on October 18, 2018.

 Panelists:

   

   

Jeff Goodhew: Michael, as far as timing goes, what type of research did you do in finding your location in Edmonton?

Michael Kreuzer (Practice in Edmonton, AB, opening January 2018): It’s an interesting and complicated question because I had two other bids on places before finally determining my end location in the city.

Key things to me were a demographic that had a lot of growth and a lot of younger people moving to it. My current location is on a retail street which has experienced tremendous growth over the past 5 to 10 years The area is under-represented in terms of optometrists. Those were two key factors.

If you find a good commercial real estate broker they should be able to help you with identifying key market demographics. My broker for instance had sent me locations of other optometrists in the city within 1km to 5km radius away. Based on that information you can piece together a decent spot that you can stake for your own.

Another important factor in the location is price. In these high density urban areas in Edmonton there is a pretty big fluctuation in terms of the asking price per square foot. One key piece of information I got from my adviser was to keep in mind that a huge cost that you can control upfront is your overhead,  –  the cost per square foot. Being aware of that and not overspending on your real estate is a great way to get started on the right foot.

Jeff: Your broker obviously went above and beyond. You are saying your broker was the one that sort of mapped out where the competition was, not yourself.

Michael: I was aware of the competition but he definitely went above and beyond, and with that information it allowed me to focus my energy in other aspects of looking at places. That’s the benefit of having a great team from the start, you can piggyback off of the services of other professionals who are way better at this than when you are starting and you have panned in so many different spots. It was a really big help.

Jeff: Laurie, how did you choose where to open your practice back in 2015?

Laurie Capogna (Family Eye Care, Niagara Falls, ON): Niagara Falls isn’t all that large of a city, so I thought about using a real estate broker but in the end, I didn’t. I ended up myself driving around finding every vacant building that was available. I had a bit of a dilemma, at first I really wanted to buy a building. I’d never leased before, I’d always owned the building I was working out of. When I saw there really wasn’t anything available, I started looking into plazas, and I looked at the new ones and the older ones. Based on what was available I actually just took something that I liked and  because it was in the same plaza as a Shopper’s Drug Mart. [Leasing here] actually proved to be very, a very good decision because I can’t tell you how many patients come in say, “I love your location and I see you here all the time and I’m in this plaza all the time.” I didn’t realize the benefit to being in a retail location because I’d always been in a medical building before.

Jeff: Agata, you opened in a highly competitive neighborhood in Toronto. What did you look for when you opened your practice?

Agata Majewski (Owl Optometry, Toronto, ON): In the city, I think it’s very hard to find a place where you don’t have an optometrist next door. My location is at street level in a very family friendly neighbourhood. There are four or five schools surrounding me. I knew the area I wanted to be in and I was driving by and saw this space for lease, which was an old variety shop. It’s a small space but it’s street level and most of our patients are just coming in off the street, I didn’t have to advertise.

Jeff: Can any of you comment on opening a new practice in a medical building versus a sort of street level traditional retail location? Does anyone have an experience around that?

Ritesh Patel (See & Be Seen Eye Care, Liberty Village, Toronto, ON): While we were actually going through the process of where we wanted to open, we created a matrix, and the matrix consisted of the four or five things that were most valuable to us. One of the things on that list was being around family physicians and practitioners, because in Ontario you can consider them a “feeder system” to just have patients come through the door whether it happens to be a diabetic or red eye or annual exams, or children, whatever it may be. In our case we are retail ground floor setting in a relatively high traffic area, but we also happen to be in the same building as 12 to 15 family physicians as well. You don’t necessarily have to choose one versus the other.

Jeff: Anyone else have any comments on location before we go on?

Howard Dolman (Dolman Eyecare Centre, New Hamburg, ON): We are in a very rural setting, a small community and the vast majority of patients drive to our clinic, and so the amount of parking that you have in a rural setting is important as opposed to being in an urban setting where being closer to transit and having easy access for your patients to get to you. That’s certainly one consideration to think of in terms of location.

Tina Goodhew (Abbey Eye Care, Oakville, ON): If you are in the process of still trying to look at an area and you don’t have a broker yet, you can also check with city hall and they often have plans on what their growth and demographics of a neighborhood is.

One of the other tips we give you is to plot your competition. The final thought I have here is that even the location within your location is extremely important. What I mean by that is, we are in a mall that we have been in for 12 years but for 10 of those years we were at one side of the strip and two years ago we renovated and expanded and we moved to the centre of this strip that happens to be in front of one of the driving entrances, and we’ve found that out traffic has jumped significantly. People said that they didn’t know that we were in the mall previously even though we’d been there for 10 years! Again, location within the location is very key as well.

 

Click here to listen to the entire webinar 

 

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Seven Expert Tips to Getting the Best Lease

Finance|Wealth, Office Design & Renovation, Practice, Real Estate, Resources

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Negotiating a lease is not something that you’ll do very often. Prepare for the discussion and take heed of the following seven tips for success:

  1. Initially offer about 20% less than asking net rents
  2. Know that net rent is the negotiable portion of the deal. The additional rent or taxes, maintenance and insurance (TMI) are actual costs that are passed directly to the tenants and are not negotiable.
  3. If you are a new practice go for a shorter initial term, such as three or five years, with a couple of five year renewal options. This provides an escape if things don’t work out.
  4. If you are an established practice or very confident of success, a longer initial term (ten years) will enable you to fix the rents for a longer time and get a tenant improvement allowance (TI) from the landlord.
  5. Go for as much free rent as possible….try to get three months totally rent free (no net rent or TMI) for your practice buildout, plus three more months net rent free to get established up and running.
  6. Make sure your lease is assignable so you have the option of selling your practice in that location.
  7. Insist on an exclusivity for all optometric, optical and ophthalmic activities.

THOMAS A. BOLLUM

Tom Bollum is a former retail optical executive and now a commercial real estate broker with Avison Young. He has sourced and negotiated locations for many optical stores across Canada.

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