When opening an aesthetic medical practice, understanding your financial picture is critical for success. The proforma is an all-encompassing financial model that takes into consideration every aspect of your future practice. There are many ways to develop a financial proforma, but utilizing comparables, benchmarks, and assumptions to help forecast sales and project growth is a good starting point. If you do not have access to a large database of existing practice financials, profit & loss statements, and POS entries, it can be difficult to develop proformas. Thankfully, the team at Acara Partners has worked with over 200+ aesthetic medical practices and launches around 15 aesthetic medical practices each year. We are constantly developing financial proformas for our clients and, as a result, can project numbers within a 5%* margin of error. In this two-part blog series, we will share what goes into a financial proforma for an aesthetic medical practice.
The Concept Document, Architectural Program, and Leasehold
Before jumping into the financials, Acara Partners works with our clients to develop a comprehensive concept document. The concept document outlines the purpose, vision, and mission of a business. Most importantly, it details the program components and service offerings that will make the project feasible. Since there must be space allocated for these services and the devices used to administer them, an architectural program must also be developed. This data is based off the space required for specific devices and functions, and is created based on Acara’s extensive database featuring hundreds of practices around the world. Everything should be accounted for, from reception and waiting areas to storage, retail display, procedure rooms, and more.
The architectural program feeds into the leasehold. The leasehold is a breakdown of the total square footage needed for the practice and the cost per square foot. From that, Acara can calculate the leasehold expense, which also takes into consideration contingency and tenant improvement allowances.
Furniture Fixtures and Equipment (FF&E) / Start-up Costs
Now that we have allocated for the buildout of the space, we need to fill the space with the proper furniture and equipment. Thankfully, Acara has placed over a thousand devices in various practices. This allows us to retrieve accurate pricing for any service or device, and even receive major discounts. (Acara receives up to 30% off from many device/product companies that gets passed directly onto our clients.) When developing the FF&E section, we consider:
• Lobby/reception furniture and storage
• Display units
• All devices, dispensary equipment, and supplies for the consultation rooms (camera, software, blue wall, etc.)
• Artwork, window treatments, signage, etc.
• Systems such as telephones, security, sound, audio visual, printers, POS, and laundry
Once we have identified the total FF&E, our team will look at start-up costs to get your practice open. This will include everything from your first order of skin care products, to office supplies, OSHA / HIPAA training, website development and hosting, licensing, legal fees, and prelaunch interest.
There are many other start-up costs to account for, and much more that goes into developing a proforma. It is our goal to get you started on the right foot. Contact our team today and let us share a sample proforma to see what an investment summary looks like when launching a new practice. Fill out our form to contact us for more details: https://www.acarapartners.com/lets-talk/
Read Part 2 where we dive into the income statement, balance sheet, and cash flows.
*The information prepared in Acara Partners’ models are prepared to the best of the knowledge of Acara Partners in accordance with Acara Partners’ standard practices. There can be no assurance, however, that any project or assumption made by Acara Partners or relied upon by the client will prove accurate, nor can there be any guarantee that any changes in a business situation will not cause results materially different from those projected in a financial model.