Why simply looking at your price list isn’t enough
One of those random coincidences that occur in life (and have us wondering whether we are watched over) has been three clients, far apart, who have commissioned a price analysis.
In each case, a member of the team has been tasked with calling around other practices within a reasonable travel time (and who offer a similar range of services) to see just where the client stands.
A further coincidence is that all three of them discovered that they were in the upper quartile (top 25%) for the majority of their items of treatment.
In conversation with each of the owners, although the research indicates that the existing price list should stay as it is, the owner has an itch that still needs scratching.
But it’s clearly not the pricing.
So we talk some more.
We talk about the average daily production of each of the fee earners and discover that, in 2 of the 3 examples, the fee-earners (apart from the owner) are trotting along at a very average pace, whereas the owner is hitting much higher levels of production (skin in the game and all that).
So in those practices, we need to have a conversation with the fee-earners about their productivity. Good luck with that, because I’ve discovered over the years that no amount of carrot or stick from the owner is likely to make a difference. Fee-earners increase their production when it suits them – a.k.a. marriage, house purchase, pregnancy or school fees.
In the third practice, the fee-earners are all above average.
So it’s clearly neither the prices, nor the production.
So we talk some more.
That further conversation requires a detailed analysis of the treatment plans that the fee-earners are creating for patients and the “deals” that are being done.
What we find on investigation is two simultaneously problems.
Items of treatment within a comprehensive plan for which too low a price is being charged – or no charge at all;
Discounts offered to get deals across the line.
It’s very clear that what is in operation is a fear factor, an internal conversation that “if I charge the patient for everything in this treatment plan, they will walk away – so I’m going to reduce/avoid some of the costs – to ensure that I get the business.”
Which sounds to me like a lose:lose for the practice and the fee-earner and a very clear win for the patient (who may or may not appreciate it).
So in the third example, the owner has to review treatment plan pricing and train, coach, mentor the fee-earners to sell the full price – just like he does every day.
The benefits of that time investment by the owner will be short-term pain and long-term gain.
Review your PRICES;
Review your PRODUCTION;
Review your PRICING.