StudentDC Interactive

I recently received an email from a grad who was concerned about the economic situation and her ability to get a loan.  Here is how I replied:

I have been talking to a lot of new DC’s who are getting loans from banks.  There are certainly still loans available from traditional banks, but, as the SCORE person suggested, they require some collateral/cash on your part, or a co-signer.   Your excellent credit is definitely a plus.

Here are some possibilities:

Leasing.  NCMIC is one place I would suggest trying to get an equipment lease.  They may also have other funds available in addition to the leases.

Non-traditional financing.  I have been writing about other places to get loans that are more “non-traditional.”  Two I have written about are BCS Business Credit and Wirth Business Credit.  I would try Wirth first; I’ll be interested in what they say.  Their interest rates will be higher than a bank, but they may be more willing to talk to you.
SBA Loan Guarantees. The SBA works with intermediaries (non-profit organizations) who will do “micro” loans (up to $35,000) for certain types of businesses.  Women-owned businesses are one of these types, as are veterans businesses.  ACCION USA is one of these organizations.
You might also try your state business development office.  They also help women business owners.

Another possibility is to get a pre-approval by the Small Business Administration.  If they approve you, you can take that to a bank and it might help persuade the bank to give you a loan.  Check with your local SBA office.

The website Business.gov provides a way for you to search for available SBA loans, micro-loans, and state loans and grants.

Oh, yes, and search the Chiropractic Economics website for more!  This is not a complete list, but it will give you a start. I’m not saying it will be easy, but there are still options out there; you just have to be very persistent and keep trying things.  I wish you success!  Please let me know if you are able to find financing for  your startup.

I just talked to a new grad who talked to several banks and got a startup loan with only 10% down and no co-signer.  I also have heard that SBA loan money is getting harder to come by, but I heard of someone else who got an SBA-guaranteed loan.

Can you still get a loan, despite the dificult credit situation?  It depends:

• It depends on the bank.  You have to keep looking, making changes in your request, talking to bank after bank.  If you go to 10 banks, don’t give up. Maybe the 11th will be the one that says “yes.”
• It depends on the region of the country where you are, the state where you are.  The first instance above was out west.  Banks and SBA offices in other states might not be so willing to give.  I’ve never been able to figure that one out.
• It depends on your personal financial situation.  Especially your credit rating.  Banks are requiring higher FICO scores, over 700 and even up to 750 now.  Know your credit score; if it’s low, think about how you will overcome that number.
• It depends on how much you are asking.  Cut down your request to an absolute minimum.  What do you REALLY need, as opposed to what you think you want?  The less you ask for, the better your chances of receiving it.

A note of encouragement:

Perseverance is a great element of success. If you only knock long
enough at the gate, you are sure to wake up somebody.       — Longfellow

You’re headed off to the bank with fantastic business plan in hand, but you have no cash, no co-signer, no collateral.  Don’t be surprised if the bank turns you down. Banks want to loan money via “secured” loans - loans that have something of value behind them that the bank can take if you don’t pay.  That “something of value” has to be something that the bank can quickly turn into cash without much loss.  Obviously, cash is best.  Next would be something like a building that you or your co-signer owns that the bank can expect to get money out of.  In these times of decreasing home values, don’t be surprised if the bank says the equity in the home has to be much greater than the loan value.  The equipment that you bought has value, but it depreciates (loses value over time), so the bank will take a loss if you have to sell it.  That’s why they often ignore all that great stuff you just bought.

Why is the bank so picky about this?  Businesses go bankrupt, including chiropractic businesses.  And banks want to be “first in line” to get their money back.  So they want a solid assurance that they can get that money back, easily and quickly.  In these tough financial times, banks are even more skittish than usual, because business bankruptcies and mortgage foreclosures are more common.  The bank will fail (like Washington Mutual) if they continue to make high-risk loans.

Just one more point:  If you want a line of credit for working capital, in the past a bank might give you this money unsecured, but these days they want security, for the reason I discussed above.  It’s often said that “banks loan money to people who don’t need it.”  This is what they mean.  Be prepared to pledge assets, or find a co-signer who will do so.

I hear lots of students say they want a “wellness” practice.  I’m never sure what that means.  Does it mean you want to treat people who are well?  You certainly can do that, but you won’t get any insurance or Medicare money for this, so these people must be “cash” patients.

Does it mean you want to promote wellness among patients and staff?  If so, I applaud you.  If you want to encourage “wellness thinking” among staff, how will you do that?  There are lots of opportunities in your practice to help people think “wellness” instead of “sickness” or “dis-ease.”  Remember, we move toward what we think about .

For example, change your time off policy to have “wellness days” instead of “sick days.”  In a prior job, I heard it called “taking a mental health day.”  The principle is that you don’t need to be sick to take a day off; sometimes you just need to stay at home, or go do some errands that have been piling up, or spend time with your family.  And sometimes people really are sick and need to be at home to “get well.”  A benefit of instituting Wellness Days is that employees can just call in and say they’re taking a wellness day; they don’t need to lie and say they’re sick.  And you don’t need to differentiate between sick days or personal days; they’re all wellness days.

Of course, you must limit the number of Wellness Days you provide; you should have no more than you would have provided for staff sick days and personal days combined.  It makes the time off calculations easier.  More important, it sends a message to your staff that you care about their wellness.

To continue this discussion, what other kinds of things could you do in your office to encourage wellness among staff?  How about encouraging patient wellness?  What would a Wellness Day for patients look like?

A readaer asked me about this one a few days ago.  Here is how I responded:

Setting up a website is definitely a good idea; having a site is becoming more and more the preferred way to attract potential patients to your site - even higher in importance than getting a Yellow Pages ad.  But the website business has gotten much more complicated in the past few years, with the addition of stuff like search engine optimization, flash special effects, and fancy widgets.  I did my own website a few years ago, but I would not attempt to tackle it now.

Here is another important reason why you should hire someone to set up your practice website:  Even if you have the expertise, do you really want to spend the time doing this when you could be doing other things - like talking to prospective patients or doing adjustments?  Setting up a website is a huge “time sucker-upper” and I would suggest you not get sucked into that task.

You can set up a fairly simple site for not much money, with all the information a prospective patient needs - who you are, where to find you, all about chiropractic, your services, the ability to contact you by email, even new patient forms.  If you want to do the “max” (and spend much more money) you can create an interactive “member” site where people can go to interact with you and have lots of information about chiropractic.  It’s up to you, your purpose for your site, and how much money you want to spend.

There are many web designers out there.  Here are some suggestions for getting your site done, depending on your budget and your preferences:

1.  I have been working for several years with a company called VirtualImpax.  The owner, Kathy Hendershot-Hurd, is a marketing guru, book author, and website setter-upper. She has helped many people set up great-looking sites with high ranking in search engines.   She has a service called easychiropracticwebsites.comto help chiropractors set up simple but effective websites.   You can see her main website at VirtualImpax.com and you can email her at kathy[at]virtualimpax.com.

2.  I ran a search on Chiropractic Economics online to see what came up for “website design.”  There were lots of vendors on the list.  (http://www.chiroeco.com/buyersguide/Search/MarketingResults.php  .

3. I also know that Bill Esteb over at Patient Media has a partner website service called PerfectPatients.  They have lots of chiropractic content, if you’re looking for a site with more services.

When you get your site set up, send the link to me at jean@dcpracticesuccess.com - I collect chiropractic websites and I would love to see yours.