While setting up your professional practice is an exciting opportunity, it’s important to get it right from the outset.
Tackling the project in a holistic manner can help you get one step ahead. After all, the decisions you make around the types of surgical equipment you install, the layout of your practice, and even the look and feel of it will all impact your bottom line and contribute to your overall market competitiveness and ongoing success.
With the average cost of practice fit outs ranging from $400-$500k, it’s useful to have a steer on the type of assets which will be income-producing from the beginning and the range of financing options available to you. Similarly there will be some higher depreciating assets, such as software, where you may want to consider the flexibility of a shorter lease term.
If you are questioning the difference between a Ioan lease, chattel mortgage and a commercial hire-purchase, BOQ Specialist’s Hugh Lander helps with these top tips on getting it right:
1. Add as you go
With all the excitement and energy that goes in to setting up your practice, it’s natural to want everything in place from day one. However, it’s more important that your financing demands are in line with revenues so you may want to give yourself a bit of breathing space before rushing out to buy everything at once. The real question to ask is whether that particular piece of equipment, or practice room can be delayed for a few months? If it can then it’s best to hold tight – this will ease some of the pressure and help you navigate the first few months.
2. Look at the intangibles
It’s very easy to think about the tangible, physical assets for your practice such as X-ray machines or examination tables, but the softer touches and ‘back office’ capabilities such as layout design or the latest cloud storage system can make an impressive difference to the effectiveness of your practice. Many banks don’t factor these intangibles into their financing options. We prefer to look at the bigger picture by encompassing broader aspects of your practice and taking the strength of your professional qualification into account.
3. Consider the equipment life span
Equipment shelf-life and industry trends are all important aspects to consider. Taking into account the life-time of a product is essential, as well as assessing its impact on your cash flow. For example, will it be an income producing asset from the outset and will you need any further advice on managing your cash flow in the interim? We regularly conduct cash flow projections with clients, considering factors such as how many patients need to be seen over the life of an asset to ensure it pays for itself.
4. Be smart with your spend
Consider ways you can be smarter with your spend like utilising your credit card to earn additional frequent flyer points. BOQ Specialist recognises the benefits of combining business with pleasure, which is why we allow you to put select car or equipment finance payments on your BOQ Specialist credit card for a small fee and earn frequent flyer points to use towards your next holiday.
5. Partner with someone who understands your world
Knowing the market and the right questions to ask when dealing with suppliers can make all the difference. We often approve a small buffer as we understand costs can blow out.
BOQ Specialist’s Hugh Lander says, “looking beyond broad brush leasing structures and understanding the right financing options available can make the world of difference. Whether just getting started or financing their fourth practice, our 25 years’ industry experience means we can tailor solutions built around the strength of our clients’ qualifications.”
Our experience working with doctors, dentists and vets means we can offer a unique range of products to help you establish your practice.
Commercial property loans
BOQ Specialist has highly competitive commercial property loans in place to ensure that our professional clients can buy or invest in a practice or firm.
The credit provider is BOQ Specialist. Terms and conditions, fees and charges and lending and eligibility criteria apply. BOQ Specialist is not offering financial, tax or legal advice. You should obtain independent financial, tax and legal advice as appropriate. We reserve the right to cease offering these products at any time without notice. Reward points are earned in accordance with the rewards program terms and conditions. For full credit card terms and conditions visit boqspecialist.com.au/credit-card-terms. A 1.5% processing fee applies on the purchase price. Points are earned on eligible purchases only. Fixed term finance contract is to be approved prior to purchase. If you elect to make loan repayments on your BOQ Specialist Credit Card a 1.5% processing fee applies on the amount of each repayment. Repayments on overdrafts and lines of credit are not available to be made via BOQ Specialist Credit Card