I've been involved in the Starting into Practice seminars for going on four years now.  Every time we do the program, there is a slide that discusses the reasons that businesses fail.  What is interesting about this slide is that what actually causes business to fail, and what we perceive to cause business to fail are not the same.

Most students, myself included, strongly believe that the key to keeping a practice running is marketing and bringing in new patients.  However, the facts show that the number one reason that we go out of business is due to money management issues.

I learned harshly how true this is the past few months.  The story itself is long and involved, so I will give you the cliff notes. 

We were required to change our electronic claims filer here last year.  Why we were required is an issue unto itself, but that is for another time.  When we switched over in October, my revenue dropped by 80% overnight!

At first, I wasn't too worried.  My staff is awesome; they know what they are doing, and I was sure the company knew their product as well.  It was just a bug.  It would be sorted out. 

Then a month went by, then another, and another.  I keep a three month overhead buffer in my account just in case.  By January, I had burned through that.  As I approached my 6 year anniversary, I had to take out a line of credit to cover my overhead expenses!! 

Scared doesn't even begin to describe how I felt.  The worst part was that I continued to be busy in the office, yet it just didn't matter.

To make matters even worse, no one knew what was happening.  The company was blaming my staff, my staff was blaming the company, and I was just sitting there asking people to please tell me what the hell was going on! 

Things finally did get sorted through, 4 months later.  We are not quite back where we were, but we are recovering.  The bottom line is this.  Know your business and the inner workings of it.  Seeing my dream almost evaporate because of computer problems was very scary, but fortunately, I do have a good team around me that figured out what was happening and got it fixed.