Paying for a multi-therapist clinic?

[??Savannah??]

Hey guys...

I'm currently in a multi therapist "spa" where we all rent independently - I'm looking to get out, since it's not really a good situation. :evil:

A place I'm looking at renting is a large building, so I would have to rent out space to other therapists in order to be able to afford to stay there. The issue is: how many of you guys are in charge of your own multi-therapist location? The space is 1300 sq ft, not overly large but cozy, for $995/mo + utilities. I have to fork out the $$$ to build walls for seperate treatment rooms, and redo the floors (they are old and stained carpet), in addition to large signage for the building. :shock:

How many of you guys have done something like this? How has it worked out? I'm just worried about the large loan needed to cover the renovation of the building... I know it will work out in the end, but I would like some reassurance. The building is all new on the outside, in a great location just off the interstate in a VERY high traffic/visibility area - you can't BUY advertising like this! I plan to be in this building a VERY long time - I would like it to be my final clinic space (i.e., I would buy it if it were for sale).

Any reassurance is appreciated.

Thanks,

Jackie

 

[rockylad_75]

i can't answer to a multi-therapist location but i can say that you need to be prepared for the cost of the build out. it won't be cheap. i paid to have a space finished and it cost me a lot of $$ and that was only to have 450 sq ft of space finished.

as long as you don't mind the cost you should go for it. see if you can't get the landlord to pitch in some cash to help you. ask for him to pay for flooring or something like that. keep in mind that you could potentially have to be paying several months on your own so if you can't afford $995 a month + utilities rethink what you're doing. go into it with the worst-case scenerio in your mind, that way you're prepared.

 

[solvent]

Jackie,

It seems to me like you have made up your mind. If you really have fallen in love with this place and see yourself there for many years, I say 'go for it!!'

You just need to play with the numbers quite a bit. Look at this from every possible angle. How much would it cost to build your dream space? What would the monthly expenses be? How much could you receive in monthly rent for such a great location and beautiful, new treatment rooms? Would the rooms be rented 100% of the time from the start? That's 'Plan A' ... then look at 'Plan B'

How much will the loan cover? Will it completely cover all the work of your dream office? If not, would it kill you to have one or two unfinished rooms for a few months? How much rent would that give you to have all but one or two rooms rented? I know this is not ideal, but could it work?

Do you know a therapist or two that would kick in some money to help with building costs if they could have reduced rent for 6 months or a year? Would that work for your business plan to do that?

My bottom line is that if this is truly right for you, you can make it work. It sounds like you are already 'there'. If you are not doing it already spend some time each day sitting down for a minute or two and envisioning the absolute perfect space and how amazing it is to be there. You can make it happen!

Keep us posted!

Brian

 

[DogLover]

yes, ask all of those questions brian listed.

i own a multi-therapist location. began as a single therapist in '05 then expanded 2/07 to a 1500 sq ft location. my expenses are $1450 just for rent. a year or so later, i have ONE consistent lessee and two therapists that still aren't up to paying rent, so we do a % unless rent is made.

it's hard. it's frustrating, b/c before i expanded, i was doing well and was bringing home a decent salary. not anything to write home about, but good. i was banking on other therapists doing the same, and they're not. so every cent that i bring in covers the overhead, and i'm getting really tired. i never thought i'd say this, but everyday i think about the fact that we now have a home that i could work out of, and how much easier that would be. i wouldn't have to work as hard and i would actually make some money. in all honesty, there have been months that i've brought home $100.

so i'm not telling you not to do it, but i will say this: i wish that i had had an investor, i wish that i had applied for the loan instead of using my own money, and i wish that i'd had an attorney help me with the LLC paperwork instead of my very smart and talented CPA who unfortunately didn't know everything. i also wish that i'd stuck to my guns on rent AND marketing responsibilities for each therapist.

and i really don't mean for this post to bring you down or get OT or anything else, i just want to show you how it happened in my circumstance. of course that doesn't mean it will happen in yours and i'm sure that you will be very successful.

good luck!

 

[Ayameko]

I would suggest reading some of Anastasia (or is it AnastasiaB?)'s posts. She has a setup similar to what you're looking into, and the drama has been high lately (always?). That may be an aspect you haven't considered, and you should go into this with your eyes WIDE OPEN, knowing the full range of possibilities of what could happen. Not trying to be a downer, just helping you consider all the angles.

I'm personally a private-practice person working out of my home, so I can't help you otherwise.

Good luck, whatever you end up deciding, and please keep us posted!

 

[hot potato]

Ding, here is the thread you were mentioning!

Who keeps the paperwork:
http://www.massageplanet.com/forum/viewtopic.php?t=11416

 

[Yahoo User]

The only re-assurance I can offer is a reality check.

Build-outs are not cheap.

Residential quality construction runs $150 - $200 / square foot (this includes, walls, flooring, painting, electrical)

Spa quality construction/furnishings runs $250 +++

If you start a business WITHOUT 6 months of all business expenses in the bank -- and I mean everything from rent, to phone, to utilities to biotone -- then you are asking for trouble, lots of stress and worry.

Bad cash flow is the #1 cause of small business failure.

Reality check #2 - Financing.

Contrary to popular belief, the #1 factor in obtaining financing is not the quality of your business plan.

#1 is collateral. Banks won't lend you money unless they are 99% certain you will pay them back. The surest way for them to get paid back is by holding your house or other assets hoseforum.xxxe until you do pay them back.

Ability to pay - your credit score and other family income - is a distant second. They don't want your house, they want their money back. So they want to know if you will be able to pay the loan off your existing income in case your location fails.

Your business plan is 3rd on the list, mailing because so few business plans turn out to be even 50% accurate in magnitude or timing.

Despite having great FICO scores, an impecable business plan, years of education and experience in spa and retailing, and putting $300K of our own money into our spa -- our bank would only lend us as much money as we could secure with collateral.

And that was two years ago -- we are now in a credit crunch!

The reason most start up companies rely on Credit Card financing - love those balance transfer checks - is they only require you to pay off 2% of your balance each month and want to rake in the interest and fees. They also don't ask for collateral.

 

[Pompal 09.]

Very interesting. That's good information, R&R.

 

[lostinsidemyself]

I recently leased an office space that has a 2nd treatment room that I rent out. It took some time to find another MT who fit with my vibe...there were plenty of flakes out there, but I did finally find a woman who seems to share my philosophy about business stuff. Screen your potential office mates WELL! Talk a lot about your vision. Ask a lot about their vision. DO NOT offer space to anyone who isn't really on fire about what they do! Also, are you considering other complimentary professionals? I used to see an acupuncturist who had a psychotherapist, an MT and an occupational therapist in the same multi-room space. It seemed to work well...

Good luck!

 

[Pompal 09.]

In recently purchasing a large established practice, I found R&R's statements to be dead right. If you have nothing, it will be hard to get much from a bank.

One alternative to explore is finding a financial partner. This person would have to stay OUT of daily operations but would get unrestricted access to see your books and participate in financial decision-making. It would have to be a VERY well-defined working relationship with all parties' roles defined on paper in some sort of Partnership Agreement.

If you have most of what you need but are just a bit short, it may be possible to get a cosigner on any financing. This person would essentially function as a guarantor for the loan(s), possibly the lease (landlords can be just as demanding as banks), etc. but not be an actual partner in the business. Generally a mechanism for releasing this third party from the agreement can be negotiated with the source of financing, landlord, etc.

There are other options as well, such as finding sources of financing that are more lenient than banks, and if you're lucky this may work for you. I explored all of these (and other) options, and found a great way to make things work out for us.

Last, DO CASH FLOW PROJECTIONS. If you don't know how, get some professional guidance from SCORE or other experienced pros. Generate pessimistic, optimistic, and realistic assumptions, then plug in the numbers and see how things look. It was a pain for me to get the kinks worked out, but now I have a much better grasp of what things will make or break the business we bought.

 

[schticklick]

Hey guys,

thanks for the input. I know I have to be realistic. I'm just so darn desperate to get out of the space I'm in now...

it's a multi therapist clinic as well, and everything was going fine until the main therapist started her school in September - now student clinic is going on, and myself and the other 2 therapists renting have NO new clients because they are all over in student clinic.... she blocks off my schedule to do things with her (like a career day) that she doesn't even ASK me about, and I can't afford to take time off like she can - after the $50,000 she made on tuition and the $17,000 from student clinic, she's only worried about getting clients in to her students - not us. She's turned clients AWAY if they didn't want student clinic. It's all about her students - if we're not answering the phones ourselves, we don't get any clients.

Anyway, that's just the more recent issue - there's others about kicking my out of the room I chose into another one, then renting my space part time to someone else who uses all my equipment, etc.... I know I can do this better than her, since her only focus is the school, not us. I want to have good vibes and energy in m space - I'm so angry at her now I hate being in my office, and I don't want that!!!

I'll keep you guys posted on how things go - I've put some calls into local banks for some loans, luckily I have an uncle who is a contractor/carpenter so I'll be paying his cost on everything.

BTW, I did read Anastasia's thread - The woman who is in charge of our space is a lot like her Loopy Lou, so maybe you guys can commiserate!

Jackie

 

[KING OF BANANAS]

.... I know I can do this better than her, since her only focus is the school, not us.

Danger, Will Robinson...

Whenever I hear someone say they left a job because of "bad management" or think they can do things better than the current business owner -- I see a big red flag flying in a hurricane force wind.

Chances are, someone who can bring in $50K in tuition and $17K in a student clinic has a pretty good idea of how to run a business. It may not be the business you want to work for, but it shows a degree of acumen.

Did it ever occur to you that the reason she is focusing on the school instead of the room renters is that there is more money to be made in the school?

You even said everything was fine with the multi therapist operation until she started the school. Sounds like the school is a better use of her time and money.

That tells me there is likely to be very low returns on investment of time - and more importantly - capital in running a multi-therapist operation in your area. So what exactly is it that you are going to do "better" ? And from the perspective of being the ring-leader of this venture, the only measure of "better" is making more money.

The other therapists will have a different view of what is better, but you want to become a business owner. That is about making money for your effort and investment.

 

[Shashank]

My point IS to make more money by building my clientele - she stated from the beginning that she was supporting us and that we were all working toward the same goal - we're not. Her goal is her students. I don't want to RUN a clinic. I want to rent space to other therapists so they can run their OWN businesses.

I don't blame her, she IS making more money off them than us. I KNOW THAT. It's obvious. I wouldn't pay money for her program. But plenty do, obviously. But why bother creating a lot of hard feelings by treating the therapists badly, why have a clinic, period? I do admit, it was my fault for not seeing the fact that student clinic was going to happen. Her "bad management" is making the other therapists unhappy - kicking therapists out of chosen rooms and moving them into others, giving gigs to certain therapists and not others (chair massage), blocking off schedules without asking, booking appointments in blocked time without asking, turning away clients who would pay for professional massage (b/c they don't want a student clinic massage), renting a room twice and allowing the part time therapist to use the full time therapist's linens and equipment, "borrowing" clinic therapist's linens and blankets and equipment to use with her students without asking (and not returning!), the list goes on... that's my idea of "BAD MANAGEMENT". I think I do better by respecting the therapists who would rent from me by not comprimising their OWN businesses - their equipment and linens and space is THEIRS, because they rent it. It's not brain surgery, people. I'm sick of things disappearing, used towels left in my heater that I didn't use, my stool missing, etc... IS THIS SO WRONG?????!!!!

My area CAN sustain a multi therapist practice, especially with trained, credentialed practitioners that are rare in this state that doesn't have any regulations for massage - like I said, doing fine until student clinic started. I'm not setting up shop in the same town - I'm going further away, to my hometown. And my regulars are from my hometown, anyway - they go out of their way to get massage from me. The place is in a more visible location with no other therapists in town... I really feel it would be sucessful for myself and the people renting there.

 

[Cloe Scott]

Those ALL sound like very legitimate complaints, highlandbodyworks. That is not only poor management, but dishonest. It sounds like a perfect recipe for losing renters!

 

[I Will Cook and Eat Chaka]

I didn't think I'd really have to do much to be a BETTER landlord - you know what I mean? : I'm sick of renting a room that isn't mine! :evil: And other people using my stuff - like I need someone adding to the wear and tear on my table! :roll:

At least I'm not alone. Of the 3 other therapists, only one is full time like me, the other 2 are part time and are never there because of the lead therapist. So the other full time therapist and I get the brunt of most of things I complained about. :? She wants to come with me when I go, and if she wants to, fine - it's a free country still, right? :roll: Except I'll ask her to get National Certification....

 

[Becky Sue!!]

I didn't think I'd really have to do much to be a BETTER landlord - you know what I mean? : I'm sick of renting a room that isn't mine! :evil: And other people using my stuff - like I need someone adding to the wear and tear on my table! :roll:

At least I'm not alone. Of the 3 other therapists, only one is full time like me, the other 2 are part time and are never there because of the lead therapist. So the other full time therapist and I get the brunt of most of things I complained about. :? She wants to come with me when I go, and if she wants to, fine - it's a free country still, right? :roll: Except I'll ask her to get National Certification....

Thanks for listening, guys. I think a few of you thought I would be "running" a multi therapist practice - that is NOT the case. I would be renting a larger space, and renting rooms out to other therapists - they run their OWN practice, their own advertising, etc... Not like where we are now, where the main person chooses the advertising we have no say in but still have to pay for that promotes her school and not us.

LOL! I'll stop now...

 

[Tammy L]

I didn't think I'd really have to do much to be a BETTER landlord - you know what I mean? : I'm sick of renting a room that isn't mine! :evil: And other people using my stuff - like I need someone adding to the wear and tear on my table! :roll:

At least I'm not alone. Of the 3 other therapists, only one is full time like me, the other 2 are part time and are never there because of the lead therapist. So the other full time therapist and I get the brunt of most of things I complained about. :? She wants to come with me when I go, and if she wants to, fine - it's a free country still, right? :roll: Except I'll ask her to get National Certification....

Thanks for listening, guys. I think a few of you thought I would be "running" a multi therapist practice - that is NOT the case. I would be renting a larger space, and renting rooms out to other therapists - they run their OWN practice, their own advertising, etc... Not like where we are now, where the main person chooses the advertising we have no say in but still have to pay for that promotes her school and not us.

LOL! I'll stop now...

 

[Pompal 09.]

Just a little update...

my landlady apparently was extremely upset when one of her clients told her that her husband had shown a space he owned to myself and another therapist that rents space with me. She gave me a notice on Friday to be out by Sunday, and deleted all my information out of our appointment software (including my schedule) and kept all my client files and is now marketing to my clients. :evil:

So now I'm in a temporary space. It's the space I wanted to renovate, anyway - but now if I want to stay there, I have to go through with the renovation. It looks like now I can do it in seforum.xxxes - walls, then carpet, then heaters.... so I guess I am still going to do it, but NOT with other therapists. After I told professional friends about the situation, they all had horror stories for me about multi therapist offices, and now I'm rather convinced that they don't really work out unless you're an employee (and even then....). :roll: Oh well - I learned my lesson, and an expensive one, too. I have to replace all my client files, figure out who I had on my schedule for the next month and hopefully get all my clients' information to let them know I'm not at that building anymore.

I'm SO much better off, but it's so stressful to make a functioning office within 48 hours. And expensive besides. : It's been a rough week, but I know this will be better.

Jackie

 

[71cooldude]

Jackie, I'm sorry that happened to you. I'm sure it wasn't LEGAL. Good luck in your new space....and contacting current clients and remaking your schedule, etc.

 

[citcat45]

I'm sure it wasn't LEGAL.

It probably was legal.

Wasn't nice.

Wasn't professional.

But probably within the bounds of legality.

Get things in writing, and read the damn writing! Don't like the writing, don't sign it until you do.

If you lease space, the lease should state grounds for eviction prior to term, ownership of client information, etc. Without any of that spelled out, it is just your word against theirs.