Consider these factors when deciding whether to add a second location

A question I often hear from colleagues is: When is a good time to open a second location? Fifteen years ago, I was the one asking that question to a friend who had 20 locations at the time, then expanded to over 30 and, subsequently, sold them.

Here, I share the six questions this friend recommended I ask myself before expanding, and my ultimate decision.

1 Is your potential in location one maxed out?

If your current patient base is at capacity and you’d like to see additional patients, though there is no room to expand at your current location, it may be time to consider opening a second location.

2 Does another location reveal potential and a reasonable price?

Sometimes, there is an opportunity you don’t want to miss. Be ready financially and strategically to take that next step.

Specifically, determine whether you are set up in your current office, so you could easily replicate your processes in a second location. This means your accounting is clean and your office protocols are solid and mapped out.

3 Do you have staff who can handle the workload of two practices?

Remember, when you open a second location you need a good team to be able to make the new location profitable as quickly as possible. Otherwise, you will have a cash flow problem.

Double the locations means double the trouble if you don’t have a good plan for who and what this team will look like.

4 Can you pay the bills while waiting for the new location to become profitable?

With all the expenses of a start-up, it can take time to make a profit. Do you have a plan to be able to pay the team, the daily operating costs, and the start-up costs, all while handling the day-to-day challenges of recruiting new patients?

If you’re not sure but want to see whether you can make it work, create a business plan, and don’t count on location one to keep location two afloat.

5 Do you have a marketing plan to garner the patients needed to meet your revenue goals?

The good news about marketing is that even a start-up can market like an established business with proper planning and strategy.

Marketing for two isn’t much more challenging than marketing for one: Create a marketing calendar for both practices, establish a budget, and put the plan into action.

6 Do you want to spend the next three to five years on the issues discussed in questions one to five?

This can be the time it may take for that second office to run smoothly.

If that’s acceptable to you, I encourage you to get your plan in place and get going.

My decision

After careful consideration 15 years ago, I decided to continue to grow in our current space and create systems and processes to help my team and my colleagues. Who knows what next year holds? I continue to stay ready for my “next.” OM

Email: drapriljasper@gmail.com

Twitter: @DrAprilJasper

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