It all started with a question about ROI. Santiago asked me, “I came across the claim that you can tell your consulting clients the exact ROI when they contract you, and I was left wondering how is it possible to do this? Could you please share how can you estimate ROI from consulting? (e.g., is it top line or bottom line ROI? does it include return over investment in other providers you recommend?)”
I liked him from the beginning. He used terms most new private practitioners didn’t know and he challenged me on a claim!
To which he said:
“In your calculation, I think of 4.04 weeks as the breakeven period, which is pretty good, not as the ROI. Here is how I see it (sorry, I am nerdy and like doing this kind of math):
- Your $2,995 package is all the therapist in your example needs for a whole year (which we’ll assume as 50 weeks)
- She increases to $120 in 6 months (~25 weeks), to give her clients some time to adjust and plan accordingly
- She loses the 4 clients and adds one full pay in 6 months
- Without your help, her annual income would have been $65 x 20 x 50 = $65,000
- With your help, which will create changes in her caseload, her annual income would be
- $65 x 20 x 25 = $32,500 for the first 6 months, plus
- $120 x 17 x 25 = $51,000 for the second 6 months, for a total of $83,500
- This means that your package increased their annual income by $18,500
- Then the ROI would be ($18,500 – $2,995) / $2,995 = 518% (which sounds really awesome 🙂 )
- This is kind of a conservative scenario – if she decides to switch to full fee right away, then the ROI would be north of 1000%!”
Can you see why I like this guy? I invited him to write a guest post to go deeper into his knowledge of growing private practices! I give you, Santiago Delboy. Take it away Santiago!
What is really getting in the way of growing your private practice?
A guest post by Santiago Delboy
You may know therapists who believed that all it took to start a practice was finishing grad school, getting licensed, renting an office, perhaps creating a website, and then waiting for the phone to ring. Unfortunately, “If you build it, they will come” may work in the movies but not when launching a private practice. What gets in the way?
It’s all in your head
It is true that most clinical programs don’t prepare therapists to become business people. It is also true, however, that you don’t need an MBA to run a private practice. The issue is not lack of information. The main problem is not whether you know how to write a marketing plan, how to create a profit and loss statement, or how to implement an efficient billing process. Those things are definitely important but there are many ways you can learn about them.
Much more critical than that, and often times more difficult, is having the right mindset:
- By “right mindset” I don’t mean having an inner cheerleader (although it doesn’t hurt to have a positive attitude) or that you need to enjoy every aspect of running a practice (I have not met anyone who finds pleasure in dealing with insurance companies!).
- Having the right mindset is about acknowledging and working through the beliefs and feelings that limit your ability to grow. You see this over and over with your clients, but many times it happens with therapists as well.
- This is more critical when it relates to marketing your practice, because that is the main way to grow. There are many limiting beliefs – below are three common examples
Private Practice Growth Challenge #1 | Business is evil, helping is good
Whether we like it or not, a private practice is a business. At a basic level, you provide services that people consider worth paying for, and you will keep the money when you get paid. That makes it a business. If you don’t see it that way, it will not be sustainable.
For some therapists, however, this notion is at odds with their calling to be helpers and healers. I am not sure about where the idea that “business” and “healing” are mutually exclusive concepts, but it is clearly not useful. In fact, running a good business is one of the best things you can do for your clients. It is a way to care for your current clients (e.g., making sure their experience is hassle-free) and a way to share your talent with those who have not met you yet.
Private Practice Growth Challenge #2 | Talking about my work is like bragging
Most of us have felt somewhat uncomfortable talking about ourselves and the things we do. Maybe we were told that acknowledging and communicating our personal value is wrong. Perhaps we feel shame because deep inside we are not sure if we are good enough. Maybe we just can’t articulate what makes us unique and what we are passionate about.
There is also a common misconception that marketing is the same as self-promotion, when in reality marketing is about empathy and relationships. So talking about your passion and the work you do is not a way to brag, but a way to be known, to be seen, to develop a relationship with a potential client or a possible referral source. Moreover, what you are communicating doesn’t need to be about yourself but about them. When you talk about your work, tell others not how great you are, but how you can help them. If you didn’t believe you can help, you probably wouldn’t be a therapist.
Private Practice Growth Challenge #3 | My work will speak for itself
Doing good clinical work is essential and a great driver of your professional reputation. Then again, there are many gifted therapists who are struggling to get their name out there and remain unknown. The quality of your work can say a lot but it may not speak loud enough.
This is especially true if you live in an area with many therapists, healers, coaches and other professionals who are competing for (and sometimes confusing) potential clients. In addition, consumers/clients have more control than ever before over the decisions they make. Digital technology allows them to be more specific about what they want and have access to more alternatives to calling you. If you are starting your practice and rely only on your work to speak for you, chances are your voice will not be heard.
What can you do about it?
The most important thing you can do is acknowledging your own limiting beliefs. We all have them. For some people they are small bumps on the road, for others they are giant roadblocks. We can’t do much if we choose not to see them, so it is critical to cultivate self-awareness and question our assumptions. I once heard a seasoned therapist say “Marketing is for shampoo!” I wonder what fears or insecurities were behind his resistance, but it sounded like an unrecognized barrier.
In order to recognize what gets in the way, talk about it. As therapists we know how important this can be. Surround yourself with colleagues and friends you can talk about this with, or work through it with a coach, consultant or anyone else you trust.
Remember, the ultimate goal of overcoming these limiting mindsets is not purely selfish. You would be doing it for all the people who can benefit from your work. Growing your private practice will bring more income for yourself, but also more healing and help for people who need it.
Santiago Delboy, MBA, LSW, S-PSB, is a psychotherapist and marketing consultant based on Chicago. He is the founder of Argo Marketing Consulting, a company focused on helping therapists in private practice grow their business. He blends over 12 years of marketing experience in the corporate world with an understanding of the challenges and opportunities psychotherapists face.