Revenue up, traffic down
"Most likely, your practice is increasing its average transaction charge by capturing charges and payment for services rendered and by keeping up with fee increases," says Lorraine Monheiser List, CPA, a certified valuation analyst and a consultant with Summit Veterinary Advisors in Littleton, Colo. But your owner seems to view success parallel to practice traffic rather than profit, she says. That method may be flawed since you can't continuously monitor traffic and the appointment calendar doesn't track revenue.
"Your practice management software should be able to produce reports that reveal the number of transactions your practice completes each day, week, or month, which paints a more accurate picture," List says. "The software also should compute an average transaction charge for each doctor and for the practice overall." You can also compare actual practice revenue for this year to date with the same period last year, she says. These reports will help your owner focus on accurate and meaningful data."If the number of transactions drops, suggest ways to increase practice traffic and fill empty time slots," she says. "For example, consider follow-up calls to remind clients to schedule recommended procedures and exams."