Setting up your professional practice is an exciting opportunity, however it’s important to get it right from the outset. Tackling the project in a holistic manner can help you get one step ahead, writes BOQ Specialist’s Brett Robinson.
The decisions you make around the types of surgical equipment you install, the layout of your practice, and even the look and feel of it all impact your bottom line and contribute to your overall market competitiveness and ongoing success.
With the average cost of practice fit outs ranging from AU$400–$500,000, it’s useful to have a steer on the type of assets which will be income-producing from the beginning and the range of financing options available to you. Similarly there will be some higher depreciating assets, such as software, for which you may want to consider the flexibility of a shorter lease term.
If you are questioning the difference between a loan lease, chattel mortgage and a commercial hire-purchase, here are a few top tips on getting it right:
The real question to ask is whether that particular piece of equipment, or practice room can be delayed for a few months?
Add As You Go
With all the excitement and energy that goes in to setting up your practice, it’s natural to want everything in place from day one. However, it’s more important that your financing demands are in line with revenues, so you may want to give yourself a bit of breathing space before rushing out to buy everything at once. The real question to ask is whether that particular piece of equipment, or practice room can be delayed for a few months? If it can, then it’s best to hold tight – this will ease some of the pressure and help you navigate the first few months.
Look at the Intangibles
It’s very easy to think about the tangible, physical assets for your practice such as your equipment, but the softer touches and ‘back office’ capabilities such as layout design or the latest cloud storage system can make an impressive difference to the effectiveness of your practice. Although many banks don’t factor these intangibles into their financing options, it is important to look at the bigger picture by encompassing broader aspects of your practice and taking the strength of your professional qualification into account.
Consider the Equipment Life Span
Equipment shelf-life and industry trends are all important aspects to consider. Taking into account the life-time of a product is essential, as well as assessing its impact on your cash flow. For example, will it be an income producing asset from the outset and will you need any further advice on managing your cash flow in the interim? It makes sense then, to regularly conduct cash flow projections with your finance specialist, taking into account factors such as how many patients need to be seen over the life of an asset to ensure it pays for itself.
Be Smart with Your Spend
Consider ways you can be smarter with your spend like utilising your credit card to earn additional frequent flyer points. BOQ Specialist recognises the benefits of combining business with pleasure, which is why we allow you to put select car or equipment finance payments on your BOQ Specialist credit card for a small fee and earn frequent flyer points to use towards your next holiday.
Partner With Someone Who Understands Your World
Knowing the market and the right questions to ask when dealing with suppliers is important. Being able to look beyond broad brush leasing structures and understand the most appropriate financing options to suit your needs can make the world of difference. Whether you are just getting started or financing your fourth practice, the advice of an experienced financial expert is most important when looking for a tailored solution that can be built around your expertise and qualifications.
To understand financing options and to enable practitioners to make an informed decision, speak to a specialist in the industry with experience in providing finance for medical professionals.
BOQ Specialist can be contacted on (AUS) 1300 131 141 or visit boqspecialist.com.au
Brett Robinson is CEO of BOQ Specialist – a division of Bank of Queensland.
The credit provider is BOQ Specialist – a division of Bank of Queensland Limited ABN 32 009 656 740 Australian credit licence no. 244616 (“BOQ Specialist”). Terms and conditions, fees and charges and lending and eligibility criteria apply. BOQ Specialist is not offering financial, tax or legal advice. You should obtain independent financial, tax and legal advice as appropriate.
The opinions expressed in this article do not necessarily reflect the opinion of the author or Toma Publishing and its subsidiaries.