By Chad Fleming, OD, FAAO
Feb. 3, 2016
Practice ownership is a goal for many young ODs. But is it all it’s cracked up to be? The finances of practice ownership can be rewarding, but the stresses it puts on your life can take a toll.
I became a practice owner in 2003. When I was negotiating my associate agreement we added a clause that said after one year of associate-ship, we (myselfand the two owners at the time)would either agree to become three owners, and I would buy in, or we would part ways and I would move onto another opportunity. One of the original owners has since sold his portion of the practice to me and the other partner, and I am currently one of two owners of a two-location, five-OD, 21-support staff practice. The reason that I wanted to own, and continue to enjoy ownership, is that I like the game of business and enjoy leading people. I spend a large amount of my “free time” reading about leadership and business. Had I not been an optometrist, my plan B was Wall Street.
However, there are a significant amount of administrative responsibilities in owning a practice. At times, I would love to be an employed OD, rather than a practice owner, and just go home at the end of my clinical schedule.
Choose Your Partners Wisely
The first hard lesson I learned as a practice owner was that professional partnership is like marriage. I have enjoyed marriage to one lady for the past 19 years, and we work through the many ups and downs of marriage. My commitment to her on our wedding day has allowed us to address the many struggles of being in a relationship with another individual. Professional partnership also requires commitment and trust that must supersede any personal desires for selfish gain.
I would encourage ODs thinking of buying into a practice to observe your prospective partners’ life outside of the office. If your future partner does shady deals outside of the practice, and if your future partner has failed at marriage multiple times, those are red flags that this person may have trust issues, and have a difficult time working through relationship challenges. I’ve watched many practices dissolve or stall, unable to move forward, due to partners unable to get along. Take time to get to know your partner, and most importantly, to observe your partners’ decisions and relational maturity.
I never regretted becoming a practice owner, but have struggled at times wanting to sell my shares and move on. This was mainly due to the partners unable to come to an agreement. I will be the first to admit that just as I can pick out characteristics of my partners that I had a hard time with, they could come up with the same, if not more, about me. Every partner wants different things, and believes that the practice’s success depends on key decisions. The problem is when all partners don’t have the same urgency for solving the same issues that are on the table. As I reflect back, our struggles prepared me for the new problems that arise as our practice grows.
To say I have “regretted” becoming a partner would not be as accurate as saying that I have “questioned” decisions within the partnership. Currently, I am as content and motivated as I have ever been in owning a practice.
Get Your Spouse on Board
My wife was in the optical industry for 10 years as a Marchon sales rep prior to us adopting our children. Fortunately, she understands the demands of an optometrist/owner to a point. We continue to work hard to communicate to keep the marriage healthy. You can successfully own a practice and be engaged in your family, however, it takes hard work and commitment.
If you are not willing to sacrifice your marriage, you must have your spouse on board. They must understand and be willing to accept that you could get home at 7:30 pm and not see the children that day. They must understand that you could have to cancel weekend plans if your associate has a full schedule and calls in sick. They
should understand that the life of an owner is different from the life of a clinical optometrist. The clinic will keep you working later some days; business ownership will keep you working, either physically or mentally, on weekends, evenings, holidays, during children’s games and concerts.
I would not be able to do what I do if it weren’t for the partnership of my spouse. As an owner, I have to have flexibility for meetings and putting out fires that occur during the day at the practice. Yes, managers within the practice can handle some things, but as the owner, you are the one ultimately responsible. My wife does all of the children’s activities and manages the home. She and I struggle with my time commitment, especially on Monday and Tuesday nights. I do not get home until 7-7:30 pm, and we do not eat as a family unless all of them wait for me. Due to how we schedule patients, front-of-week loaded heavy, I work longer Mondays and Tuesdays. We also struggle with how I have to work when we do get away to go visit the grandparents or other family.
On the weekends, there are many times I have to finish administrative work, or have meetings with my partner. Since my wife stays home with the children, she is flexible in her time, so that it accommodates my schedule. This allows for us to maximize those times when I do have the freedom to get away for a longer weekend.
Weigh Financial Benefits with Quality of Life
A successful practice can offer great financial advantages. But what many research channels do not explore, or have a hard time exploring, is the measurement on quality of life. When I look at research that documents that practice ownership is more profitable, I reflect on the intangible cost of the financial reward. There was a great book that I read called Drive: The Surprising Truth About What Motivates Us by Daniel Pink. His research showed that finances are not the driving factor for Generation X and Millennials, the two generations seeking to buy practices now. Be very careful that your decision to become an owner is not based on the financial rewards as the financial rewards come after years of investing time, energy and sacrifice.
However, if you factor in personal sacrifice, and that is something that you and your spouse are willing to give, then ownership is probably a good decision for you. If you want the freedom that not owning an optometry business provides, then you may want to work as an associate. Keep in mind that when you read articles or research about practice ownership, it is always easiest for those interviewed or surveyed to stroke their own ego. Telling you how much I make through ownership, and other high points, is fun to talk about, but admitting to the things that ownership has cost, is not as fun to talk about. That said, don’t be discouraged from owning a practice. I’m saying all this as the co-owner of a large practice. What is important is you know what you are committing to.
Owning a practice is not something that a new OD should take lightly. I am not encouraging a new OD not to own, but I would encourage them to work through the sacrifices that are involved with owning an optometry practice.
Ask Yourself About Your End Goals
All and all, practice ownership is a great fit for me. Does it fit everyone? No. The difficult part about deciding to own a practice is figuring out the best option for your unique outlook and circumstances. Do you know yourself well enough to decide what is ultimately best for you? If it is about the financial benefits, there are many other options outside of optometry that afford you the ability to be financially successful. I would venture to bet that many potential practice owners are weighing success on a scale that balances much more than finances. What is driving you?
Are you a practice owner? Why did you decide that practice ownership was the best path for you? What have been the greatest challenges and rewards of practice ownership? Are you an employed OD? Why was that path better for you than practice ownership?