Location, location, location: analysis is essential when starting a practice

May 29, 2012

By Chad Fleming, O.D., AOA Practice Advancement Committee

I remember the day I started second-grade. It was the day I rode my bike to school for the first time, and it was the day I think my mom cried from when I left until I came home. Starting anything new brings with it many mixed emotions. For some, the emotions are exhilarating and for others suffocating. Unlike second-grade, there is more risk involved in beginning a new practice.

One of the key components of beginning a new practice is risk management. In preparation for beginning a new practice, there are a couple of key initial areas to focus on. With the availability of the Internet, this does not take the time nor energy that it once did because most all the information you need can be found on wikipedia.

I know, I know, wikipedia is not a peer-reviewed source. It is, however, a great tool that will have key statistics of the potential practice location, and that is a great place to start.

Another great resource is the town chamber of commerce website. This will allow you to find a couple of key components for starting a practice (demographics of the area, median household incomes, ages in the household, schools nearby, etc.).

In high-growth areas be aware that the information on the website may not be the most current.

Much of the information on the sites of chambers of commerce is based on census information. If this is the case, then a conversation with the chamber is recommended. The smaller the city, the greater the need to meet face-to-face. There should be an individual in charge of city development, and that individual is highly valuable in researching not only the current state of the city but also future development.

Key components of location analysis include:

  • Decide where to practice (family considerations, school, church, job opportunities for spouse, small town, medical emphasis, vision therapy emphasis, etc.)
  • After narrowing down the cities/towns to three or five, evaluate the number of surrounding ODs for your location
  • The analysis should factor in the age of practicing ODs and any niche they may have. This will give you a clearer understanding of your competition. If five ODs are in the area, and they are all over age 60 and you are 28 to 32, you just found yourself a great practice opportunity.
  • I would recommend starting with Google maps, searching “optometrists in city, state,” and then draw a three-mile, five-mile, and 10-mile radius around your location. Use a “screen capture” or clipping feature for the map. Evernote is a great tool for this. Also, there is a great free program called Skitch that works great for drawing on an image capture from your Internet browser of the map results of the city you searched.

Research demographics and population statistics to keep in mind include:

  • The demographic information on the chamber of commerce website should indicate the population base within those various areas. The average household income and average age of the area are also key characteristics to match your interests and the best location. Then note how many ODs are practicing within your circles and compare population to the number of ODs.
  • A single full-time OD needs approximately 5,000 to 7,000 people to support the practice (according to “Business Aspects of Optometry”).

The chamber website should also help with: average household income, schools nearby (age range of nearby schools, average age of children per household), residential or commercial area (patients like convenience), surrounding insurance plans utilized by companies in area (email and/or visit human resource departments), age of practicing ODs in area (a 30-year-old optometrist attracts patients who are within 10 years of his or her age).

Starting a practice involves much more then picking the right location; however, the right location can and many times does increase the likelihood of taking your dream into a profitable reality.

My mother did not let me go to just any school when I was in second grade. She made sure I was at a school where I would have the greatest chance to grow and succeed.

Similar to my mother letting me go the first day of second grade, so also must you let go of the fear of starting a new practice.

If my mother had never let me go to second grade, my life would not have afforded the many opportunities that awaited me.

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