Will HumphreysVirtual Assistant & Healthcare Recruiting Expert

The Greatest Potential To Go Sideways On Owners

Name: The Greatest Potential To Go Sideways On Owners
Uploaded: 2023-06-12T13:45:00+00:00
Duration: 45 s
Channel: Will Humphreys
Description: Will Humphreys (speaker) warns that payroll is the largest expense and the area with the greatest potential to negatively impact owners' net margin. He…

12 Jun 2023 · 1 min

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Will Humphreys (speaker) warns that payroll is the largest expense and the area with the greatest potential to negatively impact owners' net margin. He advises allocating roughly 30% of income to clinical staff and about 20% to administrative personnel, and highlights that administrative costs (including directors and technicians) are non-revenue-producing and scale riskily as practices grow.

Questions this video answers

Roughly 30% of income.

Roughly 20% of income.

Chapters

The net margin game is always in our payroll. It's our biggest expense by far. It's got the greatest potential to go sideways on us as owners. Now, how do we know how much of that should be clinical team and how much of that should be administrative personnel? Well, the statistic gets further broken down from there. We should have roughly 30% of our income going to clinical and 20% of that going to administrative. When you start scaling your practices, this is the cost that starts to really disrupt the equation is how much we're paying directors for not. Remember, administrative cost is a non revenue producing role. So we include technicians into this role, everything. And so when we look at how to manage our payroll, the best way to do that is by looking at these percentages first and foremost.