Question
Hi Dr. Anzalone,

I will be starting my first acupuncture and holistic healthcare practice early this Summer & am trying to descern the pros & cons of leasing a space in an office building as compared to locating my practice on ground level in a shopping center, strip/mini mall, or along a street.
I am thinking an office building might appear more "high class" or professional to some patients, but I am concerned about older patients or those having physical impairments having difficulty navigating up stairs in & out of the office bldg., elevators, going to upper floors, as opposed to walking straight into a ground level office in a shopping center, strip mall, or other office alongside a street. Does goung either way make much difference in the amount of future traffic my practice may receive?
If one's practice is located in an office building, can one enter the building with a pass card to treat a patient requesting an appointment after normal business hours for most other building tenants?
I just thought I would ask some other practitioners who may have dealt with this issue before.

Thank you very much for any guidance!

Best,

Mike E.

Answer
Mike,

First, congratulations on your plans to start your own office.

The old adage, "Location, location, location!" is valid, but you should consider a few practical factors before deciding on a location and signing a lease, which is a legal commitment to occupy a space for a given time frame.

"High class" locations will almost always carry a "high class" rent... how much are you willing to spend on a monthly basis for an office location, and how much do you reasonably expect to make in a start-up practice, understanding that in today's health care climate, it may take you 5 to 7 years, on average, to grow and stabilize your practice?

Your rent will not be your only office-related overhead. You'll have to furnish it with equipment, chairs, tables, accessories, etc. Will you hire a front desk person, or will you use a voicemail system to pick up calls while you are treating patients/clients? You'll have to consider the additional expenses of professional liability insurance, office liability insurance, materials and supplies, telephone, and utilities.

A ground-level office space is probably generally more accessible for patients, but an upper-story office space could work out well if there is an elevator for those who can't negotiate stairs, and reasonable access during normal business hours. You might need to think twice about a professional office space that has limited front-door access.

Don't fall into the trap of thinking that a more fancy office space will impress people... generally, unless you are located in an exclusive area in which patients/clients are paying you cash out of pocket for your services, such trappings won't impress anyone, and will only add to your monthly stress of trying to meet your overhead.

Moreover, you need to think about where you are going to acquire your patient/client base to pay for all of your overhead expenses each month, understanding it will take years to build up a stable, sustainable practice.

I would urge you to consider sub-letting a space from another practitioner, such as a chiropractor. Sub-letting or sharing office space generally affords you much greater flexibility with rent, less utilities, and in the event that your practice fails to take off in one location, you can transfer locations without much loss. Office-sharing can be a win-win situation for both parties, because it also lowers some of the overhead from the individual sub-letting to the tenant. Sharing an office space with an allied health practitioner, such as a chiropractor, may also stimulate cross-referrals of patients. Renting a room or two in a gym or health club give you the advantage of planting your practice where health-conscious clients/patients are already centrally located.

Before you invest any money in an office location, you need to create a realistic business plan and financial forecast for at least your first year of practice. Hanging a shingle and hoping for the best is, at best, a shot-gun approach that could easily back-fire. You should speak with other acupuncturists who have set up successful offices to learn what they did right and wrong, so that you can hopefully avoid some of their mistakes. If you feel weak on your business and practice management skills, you might benefit from seeking the professional advice of an ethical practice management expert or financial consultant. Remember that when you own a health care practice, you have to balance two hands equally: the healing hand, and the business hand. If one of the two becomes unbalanced, your practice could fail.

I hope that this answer has been of some help to you. I wish you the very best of success and all good things in your practice.