Issue link: https://www.massageandbodyworkdigital.com/i/70065
MERGING PRACTICES ADVANTAGES Client satisfaction and retention, as well as exemplary service, are musts for massage practitioners hoping to survive in today's business environment. A merged practice of several therapists, each with different skills, can offer an even wider range of services for those clients you're trying to keep. For example, one therapist may be more interested in sports massage, another in craniosacral work, and another in infant massage or reiki. In a larger practice, therapists are in a better position to provide specialized and remedial services to clients, effectively opening the door to a variety of clients seeking more directed work. Handling the clients most interested in your area of expertise, while passing others to an office mate, allows you and your coworkers to grow within your specialties, all while meeting the clients' needs. Other advantages to merging practices include a greater ability to adapt to changing circumstances and improved negotiating skills with insurance companies, managed care organizations, and other third- party payers. Many professional practices are merged for synergistic reasons, primarily financial. The group benefit is greater than the sum of the individual practices. Or, two plus two equals five or more. Economies of size often create cost savings. Greater utilization can be made of the fixtures and equipment, waiting room, office area, bathrooms, storage, and common areas when they are shared. There will also be less duplication of ancillary and clerical staff, services, billing systems, and the pooling of financial resources. CHALLENGES When partnering with others, you'll face some challenges. The new structure may not eliminate all of the problems faced by individual therapists, and, in fact, it could exacerbate some. If the objectives are fuzzy, the results will be, too. Not everyone is a team player. Efficiencies are not created by the merger alone, but by the participants who must now commit themselves to operating as a harmonious group. The principal challenge is incompatibility with other merging partners and differing expectations of what the merger will accomplish. If the objectives are fuzzy, the results will be, too. Not everyone is a team player. Yet, this is what each must be if the merger is to be successful. Incompatibility problems can take different forms. There are conflicting objectives, as well as differing talents, abilities, work ethics, and financial contributions. Some may wish to work hard and develop the practice, while others are more interested in family life or recreation. In a merged practice, there is a loss of autonomy and individual control. The hierarchy among individual therapists must disappear. This implies central control, physical integration, and at times sacrificing personal preferences for the good of the whole. Without these commitments, the merger will be nothing other than a collection of individual therapeutic massage practices whose cost of doing business could be even greater than before the merger. In a larger practice, more direct management will be required. Not all massage therapists are good managers, and some who might be good managers do not want to assume the responsibility. Time spent managing is time away from professional practice duties. Cost savings per individual practitioner must be counterbalanced by the group's cost of administration. Agreeing on suitable compensation can also be a touchy issue. GETTING STARTED The starting point for this venture should be meeting with all prospective merger candidates and having a general round table discussion of what is wanted, what is expected, what each participant hopes to achieve through the merger, and what each brings to the table. If everyone isn't prepared to invest time, talents, and treasure to make it work, find some new candidates. When there is a melding of objectives, all have agreed to the basics, and some rudimentary guidelines have been outlined, the next step is to undertake a detailed pre-merger assessment of each individual practice. It is best to have one neutral professional analyst and/or professional practice appraiser conduct this task. The analysis should include: • The market value of each individual practice; the tangible and intangible assets, including goodwill. • A history of each practice, annual billings, and collections. • Details of the services each practice offers, particularly specialties not available everywhere. • A staff list from each practice, including salaries, duties, competency, length of service, etc. • Facilities that could be occupied by the merged practice. • An economic analysis of each practice with a clear understanding of what each brings into the merger. (Senior professionals are seldom interested in supporting poor performers.) 70 massage & bodywork november/december 2010