Neil Gailmard, OD, MBA, FAAO, contributing editor and member of the Optometric Management Editorial Advisory Board, shares his valuable tricks of the trade in a weekly e-newsletter. Delivered free to your inbox each week, Management Tip of the Week offers unique and insightful practice management tips from motivating staff to improving your profits with vision plans.

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What’s on Your Holiday Wish List?

December 16, 2020

By Dr. Scott A. Colonna

Toys are currently on the minds of all little boys and girls during the holiday season. This time of the year always brings a warmth to our hearts. Blessings and gratitude are posted more than ever on social media, commercials, letters and cards. However, toys are also on the minds of all optometrists, whether practice owners or not. We all have our wish lists to help serve patients, staff or ourselves better. By this time practice owners have met with their accountants to review their 2020 tax situations and plan for 2021. PPP, EIDL, PPE and ABCDE are all letters we need to factor into the end-of-year strategy. Challenging decisions are facing many practices due to these unforeseen circumstances. Decisions regarding emergency and retirement funding, equipment purchases, and EOY bonuses can be extremely difficult this year.  
Our accountant’s goal is to have us pay the lowest taxes ethically possible. If our tax bill is too high, we look elsewhere. Equipment companies entice us with end-of-year discounts and suggestions of fully utilizing the section 179 tax code. Decisions based on end-of-year situations can lead to poor spending practices. I am sure we all have purchased equipment that ends up as a coat hanger, dust collector, paperweight, or other useless item.
It is time to re-evaluate how we make financial decisions for our practices. We have been bombarded with wrong information for decades. Below are a few areas to ponder and then determine how they align with your values and financial situation.  
First and foremost, patients and work family come first. This is true in 2020 more than ever. Physical and mental wellness must be included in this category. It can be as simple as spa days or extra vacation trips.
Second, for most practices, retirement or deferred compensation plans can be enormous to company morale.
Third, development and education are vital to building work/family engagement. The benefits are endless for patient care and the community.
Fourth is expansion in either size of the practice or equipment. Cash flow is king in both cases. Also make sure, if you do want to purchase a new toy to better serve patients, that you calculate the ROI and not be swayed by the sales rep or the tax code. Determine how frequently you utilize the diagnosis code associated with the equipment and what is the lowest reimbursement you could receive. These payments should be budgeted in your fixed expenses.
Now more than ever cash flow needs to be evaluated when making personal and business financial decisions. The proper positive cash flow leads to financial freedom, which removes a weight off your shoulders to truly make an impact and be passionate about each day. I wish you and your work families a safe and blessed holiday season!
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