Office Environment

How Purchasing & Remodeling an Office Resulted in a 10% Revenue Increase

By Dori Carlson, OD

August 8, 2018

Remodeling an office can enhance care and the patient experience, and it also can make your practice more profitable.

A few years ago my husband and practice partner, Mark Helgeson, OD, and I, decided to update our office. We own two locations in rural North Dakota. We have two associate optometrists and nine additional staff. We opened “cold” in 1990, and bought the other location from a retiring OD three years later.

The check-in desk at Dr. Carlson’s new office. Patients have been wowed by the new office, allowing the practice to exceed their expectations at each visit.

We went from 1,900 to 3,100 square feet, adding a circular design, which aided patient flow, and an enhanced optical that made it seem like we had more on display than we actually did, wowing our patients.

All of these changes resulted in a 10 percent year-over-year increase in practice revenue.

Our clinic in Park River (our first office) was 1,900 sq feet, and had served us well for over two decades. We had two exam rooms, a small contact lens room, conference room, private office and a large 10 x 13 sq. ft. room that housed our visual fields unit. That was then, this is now.

The optical in Dr. Carlson’s office. The new optical gives the illusion of having more product on display than is actually there, leading patients to feel the selection has been expanded.

Fast forward several years after we’d added an OCT, then a Daytona Optos unit, and then a Marco digital refraction system that required space for an OPD. Suddenly we had 2-3 patients at any given moment in this “large” 10 x 13 room.

One of our close friends is a dentist in town. He and his partner were expanding out of their space, and looked at a building that didn’t suit their needs. He told us this might be a space that would work for us.

A funeral home had closed (there were two in a town of 1,400), and two entrepreneurial men bought it and turned it into an event center. They rented it out for open houses, and a variety of other events, however found it wasn’t a revenue-producing business in a small town. They were open to selling the building. We agreed on a price, and made a deal, in a matter of days. This was one of those gut decisions. Somehow we knew it was the right thing to do.

The entrance to the office. The new office gives a sense of open space, enhancing a feeling of comfort.

Seize Opportunity to Take Practice to Next Level
Our practice was fine before we purchased and remodeled the new office. We were “good enough.” We could have coasted to our retirement, and decided that all our town demographics allowed was this little clinic space. But my husband and I had a heart-to-heart conversation.

We continue to invest in technology for an aging demographic that has a fair amount of pathology. We see patients from birth to 102. Thirty-five percent of our patients are covered by Medicare, and typically have an eye disease of one kind or another. We had a nice net, and didn’t really need to move locations.

However, we are advocates of personal and professional growth, and we felt we weren’t growing if we didn’t continue to take chances. We believe in our profession, our services and our community, so we took the plunge. We’re not ready to be done.

The outside of Dr. Carlson’s office. The location is easy for current, and prospective, patients, to spot, as you pass by it on one of the city’s major roadways.

Location is Key
Our old location was next to the hospital, a half-block off of the main street. To get to the hospital, people needed to drive past our clinic. We felt we previously had a great location. Or so we thought.

Now we are a block closer to the hospital, and on the main highway going through town. I’ve had patients (who live in town!) tell me they never knew we had an office in town, and instead drove 15 miles to our other location.

The area of the office, where patients can relax and sip a cup of coffee. Dr. Carlson said one patient recently came to their appointment early, to relax and have a cup of coffee.

Specify & Plan Needed Changes to Office Space
We went from 1,900 sq feet, and a hallway, to 3,100 sq. ft. and a circular design. We now have two rooms for special testing and pre-testing, along with a third exam room, and we have designated space to store our diagnostic fit sets for contact lenses.

We bought a building and gutted it. The total cost, for both the building and the remodeling work, was about $750,000. We worried about how to pay for the move. We aren’t in a growing area of population, but we had faith. We stumbled upon the Bank of North Dakota, and our county, which provided buy-downs in interest. In the end they brought the interest rate down to 1 percent.

A dispensing table in the new office. The space is large enough to allow opticians to easily work one-on-one with patients.

At this moment the loan will be paid off when I’m 83. For obvious reasons, the financial incentives are wonderful, but we’re planning on how to put away extra money to pay off the loan when it balloons.

Update Your Office’s Look & Style
In the remodel we decided to have some fun. We used barn doors and local artisans for signage. A weird add-on to get rid of the funeral home look created a little alcove space. We decided to use a tree we owned that was hit by lightning, and had a funky burn mark for a mantle, and asked a patient to create a Caribou Coffee-style fireplace area with club seating, coffee bar and antler chandelier for a whimsical, fun space. I had a patient come an hour early with a book to have coffee and read by the fireplace. Who knew an eye clinic would become a destination place?!

An exam room in the new office, which allows for both an enhanced patient experience, and improved care.

Track Revenues After Purchase & Remodeling
Anecdotally we felt there was an increase in business, however we waited to really look at the numbers for a year. We’ve now been in this new location for 16 months. We have data dating back for many years. Year-over-year, we saw a 10 percent increase in revenue in the first year in the new office.

I attribute the revenue increase to the location being new and exciting. We increased square footage by 1,200 sq feet, however we decreased frame board space by 100 spaces. People consistently walk in and comment on how huge the frame selection is. The additional space gives the illusion of having more selection.

We now have a circular design with extra room for added technology we didn’t have prior to our remodel. We added a lane of equipment for a “red eye” room. I can’t say we see more per day, however our efficiency has greatly improved, so patients don’t have to wait as long for their appointments to begin.

 

 

 

Dori Carlson, OD, FAAO, is owner, along with her husband, Mark Helgeson, OD, FAAO, of Heartland Eye Care, P.C. To contact: dori.carlson@gmail.com.

 

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