Why Vision is the Missing Key for Success.
We were lasting discussing with Eric DeVriese about the importance of having clear goals in order to heal pain points in your business.
Without vision and goals attached to your financial numbers, they will be meaningless. He discussed the life cycles a business undergoes. Understanding the life cycle can bring clarity in building your business and get you where you want to go.
He continues his discussion on key differences between practices generating less than $1 million and those grossing more than $4 million a year.
In this interview learn:
- The Key difference in practices that generate $1 million vs $4 million a year
- Why most business partnerships end up like a bad marriage
- How to run your office without setting foot inside it
- Why Real Time technology is the future for business accounting
There seems to be two types of practices in general. The small solo practitioner doing less than 1 million a year and powerhouses doing over 3 million a year. Can you discuss the major differences between these two and how one is able to reach such high revenue?
The powerhouses don’t really kick in until they reach $4 million. A solo practitioner can still do up to $2 million a year. This isn’t LA or New York dollars either, this is just mid America money.
There’s a transformation that happens when you start to reach these high numbers. These high producing practices transform themselves from a dental practice into a true business.
To be able to do this, you just need to have a Vision. You have to be clear in what you’re trying to accomplish and build.
Tony Robbins says, “Energy follows focus.”
When you clearly decide what you’re trying to build, it becomes much easier to grow. You’re always watching it, monitoring it, and you want it.
Our philosophy is that we would like to get all of our clients to $2 million, as a single owner.
Now what that means is that you can’t do it all by yourself. (With the exception of this one client I have, he does $1.8 all by himself even without a hygienist, which is crazy, he’s going to burn out and kill himself.) But my point is that you really should not be doing $2 million in revenue all by yourself. This model brings on an associate. You slowly have them start working more clinical days. As you, the owner doc, quit doing hygiene checks. Block schedule doing only procedures you prefer. It’s a transitional process.
When you start with this vision. The office that you buy will be an 8 operatory practice instead of a 3 chair one. You’re buying an office that you’re going to grow into.
The difference between the $1 million and the $4 million practice is Mindset. There are clear goals in what you’re trying to accomplish.
I would argue that the $1 million solo practitioner really does it by luck. They’re just doing the dentistry. They advertise with direct mailers and yellow pages. Maybe they do Botox or Invisalign. Some other kind of revenue generator. It’s just that over time they become known in the community and established. They go from $600, 700, 900, to a million in production over their lifetime. Very much what I call, the Luck factor.
The powerhouses have a Vision. They are always working to accomplish it. Whether organically, acquisitions, or through both. They implement internal systems and controls at an early stage. They monitor the numbers and don’t make the silly mistakes that someone without a vision will do.
If nobody is holding you accountable, you’re more likely to go out there and buy that Porsche. Instead of reinvesting it into your practice because you’re trying to build something.
So the key difference between the $1 million vs the $4 million practice would be a clear Vision.
You say acquiring multiple practices would be ideal. What are your thoughts on business partnerships? Buying into 50% of a practice, to help split and lower overhead costs with a partner.
That’s a great question.
I am very convinced that there are two types of partnerships:
1. Those that fail
2. Those that will eventually fail
There are no other types of partnerships that work out. Look at the fact that the divorce rate in America is around 60%. And marriages have sex and love holding them together. The number one thing couples fight over is money.
Now your telling me that you are going to form a relationship with somebody for the sole reason of money?
Without any intimate bonds or shared interests, other than money. It just doesn’t work.
Short term, maybe.
There are so many moving variables that go into a partnership. I won’t even get into shooting a lion or anything like that. There are so many things that could go wrong.
My question to you is, “Why? Is it worth the risk?”
If we could show you how to get to where you want to go, where you control all the decisions. Rather than you doing a partnership with somebody else. Would it get you to the same place? If it did get you to that place, would you rather have split control? Or total control?
I’m not a fan of partnerships. It is so against my philosophy and what we do, that we can’t and refuse to work with clients that are in business partnerships.
These days everything is going digital. What are the benefits for your clients moving from paperless to the cloud and the internet with you guys?
It’s a complete game changer.
I know it’s a cliche, but it really really is.
We are a full service CPA firm. The reason we are able to do what we do with our clients is because of technology.
I don’t think there is a single CPA firm doing what we are doing in it’s entirety. Maybe a piece here and there, but not the whole process of what we do.
This is because, we figured out how to get this information out in “Real Time” and work at a reasonable investment. The other CPA firms just can’t do it, they’re not there yet.
The way we do it is really because of the technology. We use 100% cloud based technology and software. The accounting, payroll, digital receipts, and all of our communications are in the cloud, stored online. We meet with our clients every month and review financials with them.
Everything we do has a digital presence. With all the documents and processes we do, our clients can run them on their iPads, smartphones, and computers in real time. What that does is it puts us congruent with our message.
Our message is that,
“You, the owner, should be working on a strategy that gets you out of the office, being able to run it without setting foot inside it.”
The way you do that is through monitoring the office without you actually being in the office. The tool you use is technology. Whether it’s online accounting software, payroll, etc. You need that technology to take your practice to the next level.
Any examples of a strategy to get the business owner out of the practice and still gain a profit?
There are doctors that we’ve helped get out of their practice and still collect 10% without actually doing any clinical work. They’ve made the leap from simply having a job that only pays when they work, to having something bigger and much more valuable. It’s so valuable that it boosts the inherent value of your practice up to 200% annual revenue vs 60-80%.
This is because it’s no longer an average dental practice, but a business that has systems and technologies in place. Investors love business models that net above 10% annually.
What are some steps to get to this point?
The first step for any practice is to get your numbers under control. You have to monitor your cash flow. What comes in and what goes out. Have internal measures to protect from embezzlement. Get the proper advisors to help you with your business.
Next step is Growth. Implement cloud technology to monitor your business. Get the right staff, talented people to run your business. Create a business brand that focuses more on your clients and patients and put less focus on yourself. You need to start implementing and relying on the controls, processes and reporting aspects to run your business day to day.
Finally, you need to maintain your business brand. After having all the right staff and associates running your systems, you can begin to slowly transition out and still collect 10% of the revenue. Your position is now a CEO. You can continue to keep your golden goose or sell it to other investors and roll the cash into other investments.
Finally, how can people reach you and learn more from you?
They can google my name, Eric DeVriese.
They can get more information at our website
Eric DeVriese, CPA
Eric DeVriese is the founder of RealTime CPAs and the man who recognized a shift coming to the accounting industry. He has over 20 years experience in tax, accounting and technology. Eric has enjoyed working at PricewaterhouseCoopers on their National team creating and implementing new technology. Later working with Deloitte for several years and then in the tax department with DaimlerChrysler’s North American Headquarters. He later decided to build a different kind of CPA firm.
In 2008, Eric opened DEVRIESE & ASSOCIATES, a full service CPA firm based on the coast in Northern Florida and has been building something different ever since. It has taken years of experience, knowledge, success and failure to finally bring to life RealTime CPAs. A truly one of a kind experience, giving their clients real time access to business advisor and financial statements. This will soon be the way that much of the accounting industry will be run in the future.