What makes a medical spa make Money? During the upcoming months, we will be sharing ways that physicians create side-gigs to make passive income. The first of these side-gigs we will investigate is the Medical Spa Industry. Why are physicians opening or supporting medical spas now? Smart Doctors are doing this for several reasons:
Why Are Doctors Opening Medical Spas?
First, we do not want doctors to be sensitive about the word “side-gig.” We know it might send a sharp shiver of distaste down your spine. Fear not. It is just easier to say than “alternate stream of income.” Whichever phrase you use, you share some goals in common:
- Smart physicians want to make extra money now and become financially independent. Then, they can retire when they want to stop practicing medicine.
- The most obvious reason for owning a medical spa is making money. However, be aware it takes money for a spa to generate passive income.
- Many physicians work within a group, clinic, or hospital staff. A side-gig, like a medical spa, gives them tax benefits, deductions, and special retirement plans. There are many options for side gigs. You could choose real estate, chart review, telemedicine, product development, to name a few. However, the medical spa has attracted many compassionate but profit-oriented doctors who feel the Medspa is also very beneficial to the health and well-being of patients.
Why More and More Physicians Are Pursuing Side-gigs
Dr. Nisha Mehta, a radiologist and physician advocate puts the side-gig into perspective like this: “I’m always surprised by how little we as physicians think about passive revenue streams. We’re groomed to work 60+ hour work weeks…” Then, she adds, “but our training doesn’t include lessons on how to make the most of our incomes once we finally start making a higher salary.”
With Our Help: Invent Your Medspa and Invent Your Wealth
Invent Wealth is concerned about the lack of financial training mentioned above. Please keep in mind, we delight in teaching physicians the financial skills they need to build strategies for success and profitability.
Medical schools have long overlooked such training. Developing the simplest skills in personal and professional financial knowledge, accounting, and tax planning can change a doctor’s life. It can help a physician preserve a fine lifestyle, regardless of when he or she retires. And we are the experts who can do– or teach you how to do–these tasks. And we can teach you about them for both your medical practice and your profitable side-gig.
Let us Get Specific about your Medspa Start-up.
In our investigative research on successful Medspa operations, we are impressed with Sonya Kennedy. She is the owner and esthetic director of Magnolia Medspa. We like that she first focuses on how you should target your clients and their needs.
After all, the most elegant Medspa in the world will not make you money unless it is client-centric. Focus your basic concept on the needs of your clientele. Learn about the lives and tastes of your patients and the patients of your medical colleagues.
Focus on the Medical Spa Clients and Patients
Sonya Kennedy states, “Every single client is important, and you can’t judge them when they come in. You never know who is going to end up being a client for a lifetime.” Below we blend a bit of our advice with hers as we present these preliminary keys to Medical Spa Success:
- You do not want to create the least expensive Medspa in your area.
- Likewise, we do not advise you to be the highest-priced place in town.
- Create treatments that work within a range of patient’s budgets.
- Plan to be very honest with your clients and educate them on their skin and other feasible health and beauty goals.
Preliminary Problem Points to Ponder
We know you have a perfect preliminary concept of elegance and health. However, we are first to advise our clients to restrain those decorator dreams and details.
Do not go into debt over beautiful artsy details. Remember you will be assembling this project over time. Plus, you do not want to be a slave to today’s fashion trends. Certainly, you need to be timeless. And often, when it comes to decorating, less is more.
- For injectables, select the brand you love, and then be loyal to them. They will help you in many ways—like specials you can pocket or pass on to your medical spa patients.
- Now we know you are going to want equipment. However, we want you to buy it by the numbers. By that we mean, you must analyze the cost of a machine versus how fast it will give you a return on your investment.
Initial Financial Considerations of Owning Your Medical Spa
Now, let us look at a simple summary of early financial considerations for your Medspa:
- In addition to the cost of the equipment, you need to figure on 10-15% of your anticipated annualized revenues to go into marketing—at least for the first few years, until you become “the” word-of-mouth brand for your city.
- You might need a Medical Director, depending on how much time you will speed on day-to-day operation.
- Of course, you will spend a chunk of money on insurance: liability and medical malpractice are necessary.
- Staff is often the heart and soul of a Medspa. You need fine professionals who will sign with you exclusively. Who answers the phone? By the way, did you know “Most surveys show that you run a 46% chance of a potential patient calling another center unless the call is answered by a live person?”
- How about a medical billing system, computers, copier, credit card processing, room equipment & build-out of some or all the office space.
A Basic Investment for Your Medical Spa
To make a long story short, we suggest that you prepare a nice capital outlay of $600,000 to equip a 4-treatment room in a Medspa including build-out.
Beginner’s Pitfalls: Avoid these Financial Traps.
You cannot just be a “medical spa,” not in the 21st-century world of specialists.
Your concept must focus on the type of spa you plan. This is the problem in many day spas that offer everything from Chinese medicine to 70 types of facials and Pilates classes. Decide on your specialization limit your menu accordingly. Do one special thing and do it better than anyone else. “For example, The Skinklinic, NY, NY, focuses on clinical cosmetic treatments, Yanna, NY, NY, specializes in herbal face and body treatments. And Sundari Spas concentrate on Ayurvedic Spa services and products, combined with Yoga.”
In a nutshell, here is your goal for Step One:
- Create a Medspa concept that complements your practice.
- Make sure it matches your ethical code.
- Without getting trendy, make sure it is marketable.
- Study the numbers to guarantee it will generate revenue. and will generate revenue.
Invent Wealth: Laser-Focused on Helping You with Your Numbers
The greatest concept in the industry will not help you if you do not focus on a solid business plan. “Your Business Plan is the skeleton of your project. It is the first tangible object that represents your entire endeavor. It is what all potential investors need to review to decide if they are interested in investing their money into your venture.”
If you are not creating the plan to attract investors, realize it will be a great help to your team.
- Architects and Designers will visualize your venue from these words.
- Your Spa Consultant will read this and see how to market your services.
- And finally, your newly hired Spa Manager will learn much from this document. Then, he or she will see not only who to hire. Additionally, they will understand how to train and inspire them.
Many advisors and planners forget to inform you about one person who really needs this plan. You. The most important person who will read and reflect on your Medical Spa Business Plan is you. Yes, you need this plan also.
Before Strategy, Before Inventory, Before Design: A Business Plan for Your Medical Spa
Your business plan will keep you on budget, on time, and focused on the revenue you and your manager are anticipating. We will constantly remind you. The four biggest parts of the Medical Spa Business Plan are listed with special titles. You must examine The Executive Summary, Financial Forecasts, Management Team, and Marketing. Those are the money parts. This is because you must keep a sharp eye on each page, each dollar. Only then can you transform your medical spa dream into the bank account of reality.
In our next blog, we will delve deeper into those four areas and more.
Meanwhile, begin your research by taking some time to enjoy a few services at the finest medical spa in your area. The experience will relax you, warn you or inspire you. Invent Wealth thanks you for reading this blog and wishes you “Happy Spring!”