You are ready to take the plunge into opening your own private practice
office. You have done the numbers, and are ready to commit. But how do you find
a location that will maximize your opportunity for success?
The first thing you need to do is look at the population and
your market. How many people live in your service area? How
many Physical Therapists already service these people? Where
are your competitors located? Where are your potential
referral sources located? This is an important part for
locating the area or town in which you want to open. In
rural areas your service area may be a 10-20 mile radius
around your clinic. Our experience is that one Physical
Therapist would need a population base of 2,500 – 3,500
people to sustain a private practice. However in most
midsized to larger communities there are hospitals and a
private practices. In these cases we have found it best to
locate in high traffic areas in which there is good
population density. You may also want to consider locating
in a place that is convenient for patients from your major
referral sources. This could be in the same professional
building, or nearby center.
Once you have an idea about general location, you need to
consider the size of your clinic and the services you want
to offer. If you plan on having 40-60 patient visits per
week, a clinic of 1600-1800 square feet should meet your
needs. If you plan on seeing 60-120 visits per week you may
need a space 2200 -2500 square feet. If you plan on seeing
up to 200 visits per week you should consider a space of
3000 – 4000 square feet. You must also consider the type of
services you plan on providing. If you plan on doing fitness
or a medical oriented gym you will need much more space to
meet your needs.
In today's economy there is quite a bit of rental space
available. You need to take several things into
consideration. Is the space you are looking at already set
up in a way that you can move in as is? This can work
although the layout may not be ideal. You will probably take
a little more space than you need, but you will save
significant construction costs. If the space needs to be
“built out” you need to consider the cost. Many developers
and landlords will include construction costs in your lease.
This usually requires a commitment of at least 5 years. If
you only want to commit to a shorter term, you will most
likely need to pay for construction costs.
Traffic is important! In the old days a private practice
clinic was a destination. Patients would find you wherever
you were located. However, in today's healthcare market,
consumer choice is becoming a bigger part of the picture.
Therefore it is important to locate in high traffic areas
and have good signage! The bigger the better. People want
Physical Therapy near their work or home. So they need to
know you are there. Make sure you know the buildings rules
and allowances for a good sign before you sign the lease.
Negotiating a lease can be tricky. Remember most business
fail due to a lack of operating capitol. Therefore cash is
king! You want to negotiate a lease that maximizes your cash
flow as well as mitigates your risk. If there are extensive
build out’s required you may need to negotiate a long term
lease and have the build out cost put into the lease. If
minimal construction costs are required you may want to
negotiate a one year lease to limit your risk. Here are some
things to consider: Can you defer your first few months of
rent from the beginning of the lease to the end of the
lease? Can you have a 90 day out clause during the first 2
years of your lease? Who pays for utilities? What are the
Common Area Maintenance (CAM) costs? Who is paying the
Property Tax? Don’t be shy when negotiating a lease. You
need to do this right!
Now you are ready. You have a great location. You have a
rent that fits your budget. People will find you. Now it is
up to you to make it work!
Other Private Physical Therapy Practice related
articles by Chad
-
Starting a Private Physical Therapy Practice
-
Basic Equipment for Starting a Private Physical Therapy
Practice
-
Physical Therapy Private Practice Tips - Red Flag Rules
Last revised: June 21, 2012
by Chad Novasic, PT
