Community, Commentary and Curriculum
for Massage Therapists

"Your Theories are Great on Paper But Don't Work in Reality"

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“Thought you may appreciate some feedback on your book, lectures and articles.  I love them… they make so much sense and valuate our work as massage therapists.  Only one problem: your theories are great on paper but don't work in reality!

Maybe (your theories would work) in some communities but not in (my home province).  As an owner of a large clinic I would drive away my therapists so fast if I followed your advice on percentages, minimum rent amounts, etc. 

I have had two therapists leave recently due to the "high" rent I charge.  I hired them both as new grads and handed them full time practices.  One left to work at a doctor's office, the other to a chiropractor's for a fraction of the rent I was charging…I worked the one out to paying about 9% including receptionist. 

Even though they may not be quite as busy, as one said they are "paying so little rent, they don't have to be".  So I have to set my prices not by what I think they are worth but more in keeping with the market place to prevent more good therapists from leaving. 

Keep up the good work, and I hope to see you speak in (my home province) again soon.  I will be enjoying, but not believing, all your great sounding info.” 

From D.F., who asked her identity and location remain confidential.

Thank you D. F. for some great feedback and clearly outlining problems faced by many massage therapy clinic owners/managers.  You are exactly right…the business operating strategies I write about in Better Business Agreements: A Guide for Massage Therapists don’t always translate easily into practice. 

And here’s why.  There are a number of convictions held by our profession perpetuated by faulty information and a lack of opportunity for dialogue among colleagues. These faulty convictions have existed so long, they’re often accepted matter-of-factly without examining how unsustainable and unfair they are.  D.F. has given permission for me to answer her/his letter to "the masses", so let’s here and now examine this conviction of “I’m paying too much rent” for all our subscribers and create a better, functional conviction for the sake of this profession. 

Contracting therapists are often unaware of the costs of running a business, because they’ve never done it before and they’ve never been taught how.  Monthly lease and utilities, equipment and supplies, marketing and staffing…these can cost a considerable chunk of money.  My friend and colleague operates a clinic with seven therapists and his monthly costs are $10,000…that’s before he takes any money home for his family to live off! 

Massage therapists have received bad advice that pollutes their business agreements and leaves behind fractured relationships and an RMT industry reputation for being “transient”. 

Imagine you’re in some other industry and I gave you this advice.  “When you start out, make sure you don’t pay more than 30 – 40% of your income.  Say no to fixed rent agreements because then you’re on the hook for that rent every month.  When you do build up your business, discretely contact all the people you’ve worked with and move on.  After all, the business owner is only making money off your back.”  Sound like good, ethical, sound advice for building long-term, amicable and sustainable business relationships to you?

Let’s be clear, the business owner takes all the risk in operating the business, typically does the majority of promotion, extends the contracting therapist goodwill and exposure via established location and reputation, rents space initially for lower than market value, and eventually the contractor walks away with a chunk of that hard-earned business.  How would this type of relationship work for you as a parent?  As a spouse?  Do you think business should operate this way? 

If your style in business equates to one-night stands and “It’s all about me”, you will succeed in flowing through many broken business relationships and continue to perpetuate a business-crippling problem in this profession.  I outline in the book how to ensure as a contractor you’re receiving a fair and equitable deal. 

Clinic owners, you contribute to the problem if you haven’t visited your accountant to figure out a fair and lucrative rental agreement for a contractor subletting in the business you have built.  If you’re not clear up front as to your costs and expectations, if you cave because “well they just won’t pay what I’m asking” then you are perpetuating a dynamic that contributes to your poverty prison.  Beware of the mistake I and many clinic owners have made…do not take on contractors at an expense to yourself. 

As a business owner you are supposed to make money!  You’ve invested time, money and sweat equity into building reputation and location…that is the value the contractor is seeking to lease from you.  They can rent their own space, linens and equipment…what they desire is what you’ve worked hard to develop.  Value that! 

The profit you make above expenses is to shore resources for contingency (emergency), expand your business and build a nest egg for the day you no longer work.  Further, profit rewards you for putting your resources up for the risk of entering into business.  Remember, 4 out 5 businesses fail within the first five years...opening a business requires risk!

Why would you take on the risk of opening and operating a business if you’re not planning to profit?  If you’re not profiting, you should consider just contracting from someone else…the risk of loss and debt are too great in running a business that doesn’t make a profit. 

D.F. makes a perceptive point about not being able to attract practitioners who can lease for cheaper elsewhere.  Some health care practitioners like the chiropractor she mentioned exploit the popularity of massage to get people in the door, not caring if a profit is made.  In retail this is called a “loss leader” where you offer a product or service at little or no profit margin to expose your market to other profit-generating items.  I’ve heard many business agreement stories and I believe, not just RMT owner/managers but other health practitioners bring on RMTs without doing the math first. 

Some therapists may simply want to be less available than all day, 6 days a week, and so bring in a contractor to handle overflow.  But even in this case profit is necessary to shore for unexpected losses and to add value to your offerings. 

I urge you to be careful.  If you’ve nurtured a poverty-mentality you may make all sorts of excuses not to make a profit in your business.  I recommend reading Overcoming Underearning by Barbara Stanny http://www.barbarastanny.com/overcoming-underearning.html and Earn What You Deserve by Jerrold Mundis http://www.randomhouse.com/catalog/display.pperl?isbn=9780553572223. 

You may also want to read my post Money and Healing: Mutually Exclusive? at the Massage Therapy Canada online article resource http://www.massagetherapycanada.com/content/view/1486/59/ 

To compete against low-rent offers, you need to be clear on your tangible assets - established location and reputation, overflow traffic, working with supportive colleagues, opportunities for profit-sharing or partnership.

You will need to sell your candidates on the value of your business, and why they should seriously consider your offer to alternatives.  After all, do we all shop at Wal-Mart?  Do we all eat at McDonald's, or buy coffee at Tim Horton's?  People choose higher-cost alternatives all the time, but only when they perceive real value and compare apples to apples.

There are also tactics to lower your rent through better lease-space utilization.  Read "Strategies for Improving Terms and Maximizing Returns" in your copy of Better Business Agreements.

If you’d like to examine other common, unhelpful convictions in business agreements, listen to a replay of my March 13, 2008 Massage Therapy Radio interview Creating Better Business Agreements: Stop Losing Time, Money and Energy on Bad Business Agreements!  http://www.mtcoach.com/10_Weeks.htm

Another main problem is our standard delivery-of-care model is time and labour intensive, and for many associated reasons contractors balk at your lease offer because they don't know how to make enough money in the existing delivery model.  We'll discuss this problem in a future post.

Thank you D.F. for letting me use your great question.  I hope my fervent response generates more thinking, discussion and eventually positive action in our profession.

dqd

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