The Private Practice Success Podcast

13: Cull the January Lull of Revenue, Cash-Flow & Productivity

• Gerda Muller • Episode 13

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In this episode of the Private Practice Success Podcast, Gerda Muller tackles the common challenges of the 'January lull' within revenue, cash-flow, profitability and productivity faced by allied health private practice owners. Discover actionable strategies to manage cash flow, maintain productivity, and ensure a successful start to the new year.

In this Episode, you'll learn (amongst others):

  • How to identify and address cash-flow issues specific to January.
  • The importance of pre-planning annual leave and managing clinician availability.
  • Strategies to optimise client attendance and reduce cancellations.
  • Proactive and reactive approaches to maintaining steady revenue.
  • Strategies for both admin and clinician teams to manage client bookings.

Who This Episode Is For:

  • Private practice owners experiencing cash-flow challenges in January.
  • Allied health professionals seeking to improve financial planning and client management.
  • Business owners looking to maintain productivity and revenue year-round.

Join Gerda as she shares insights and strategies to help you overcome the January lull. Whether you're planning for the future or navigating current challenges, this episode provides practical guidance to keep your practice thriving.

Special Bonus:
Download the FREE Cull the January Lull Resource wherein Gerda share's 5 actionable strategies to implement in your business.

Connect with Private Practice Success & Gerda here:

Well, hello there, brilliant private practice owner. My name is Gerda Muller, and you are listening to the Private Practice Success Podcast. And this is episode number 13. 

Today, I want to talk to you about the month of January within the business of Allied Health Private Practice. Our official title for today's podcast is, Call the January Lull of Revenue of Revenue, Cash-Flow and Productivity. Hmm. I wonder if that sounds familiar.

Reflect on your January Experience

Let's kick this off with a bit of a reflection in order for you to check whether this episode is going to be relevant to you and your business. 

First question I have for you is this. What does your business bank account look like right now? What does the balance look like? Is it better than normal? Is it the same as usual? Or is it looking a bit empty? ? What behaviours have you been engaging in over the last couple of weeks? 

Now, this episode is dropping in early January, so , some of you might be listening to it in January, some of you might be listening to this episode in June, July, but think about your behaviours during the month of December, early January. What behaviours are you engaging in? Are you constantly checking your bank account balance? Are you reaching for your phone and going, Oh, let me just double check what is that balance looking like because there's some direct debits that need to go through and I need to ensure that there's sufficient cash for those to happen.

Are you constantly checking your emails for potential dishonour notices because a direct debit hasn't gone through? Also check in with what are you feeling when you reflect on these behaviours? How are you feeling when you know that you've been struggling to pay suppliers? Maybe it's your landlord. Maybe it's the electricity provider. Maybe it's even some of your contractors. And you know that you need to pay these people, and you don't know where the money is going to come from.

What are those feelings? Is there guilt? Is there worry? Stress? Anxiety? Shame? Feeling like I've got no business being a business owner because just look at the state of my freaking bank account. I feel so bad not being able to pay people that I need to pay. Are you finding that you need to dip into your overdraft, into your line of credit, into credit cards in order to cover expenses during this period within your business? 

If any of these things are happening to you, I need you to know that there is no judgment here. I'm guessing that you are probably judging yourself harsh enough anyway already. 

The thing is this, what you need here first and foremost is an awareness, which is why I started with these questions.

Awareness Precedes Change

Thing is, awareness precedes change. You cannot change things if you do not first become aware of it. But you can't change things unless you act on this awareness as well.

So there's one thing that needs to happen before the next, but then you need to act on it. And you do not want to fall into the trap of going, well, too late now, January is done and dusted, nothing I can do about it. I'll just try again next year, and then you forget about it, and then you start focusing on what you need to do next, and start going into the new year, only to wake up on the 1st of January going, Oh my goodness, it's groundhog day, month and year, because I am in the exact same position as I freaking was last year.

And guess what happens then? An even worse downward spiral of self-judgement and critical thinking around what a bad business owner you are. Okay, so let's make this the here that you change things. That you actually cull the January lull of revenue and cash-flow and therefore also profit and productivity.

So if this sounds familiar, keep listening. If this sounds familiar, also be sure to check the show notes because I'm going to share with you a free handout called Cull January Lull, where I'm going to talk you through five very practical strategies that you can implement in order to turn things around.

So you don't want to miss it. Go into the show notes, download it there and make sure that you have that and that you action it early for next year. Alrighty. Now, in order to cull this January lull, we first need to know what is the exact problems that we are having. Because we can only come up with the correct solutions if we know what is the problem that we need to solve. 

The biggest issue that most practice owners report with January is that lack of cash flow. And that lack of cash flow is generally as a result of the following three main things.

Impact of Limited Clinician Availability

First, clinician availability. A lot of times our clinicians are on annual holidays during December / January. Now, our clinicians are entitled to have holidays. Not only are they entitled to it, but they should also be having holidays.

It is so important to take your annual leave. I for one are a business owner that keeps her eye on annual leave balances. I do not like people having weeks and weeks and weeks of annual leave stacked up because I know that that is a red flag for burnout. I do not want that. So people should be taking their annual leave.

So how do we solve this? We need to make sure that people pre-plan their annual leave. When you know when all your employees are going to be on holidays, you know, ah, two people are going to be away at the same time during this month. Now I can plan for that. Now I can go, alright, there's going to be X amount of less revenue coming in because those clinicians can't do any billable work, and that's where all our money comes from, whilst I still need to pay them, okay?

So that's going to be a big impact on cashflow, but as a responsible business owner, I need to plan for that because that is just how business works. And this becomes even more important over December and January when people are on annual leave. We cannot just go; I'll figure that out later. That needs to stop.

We need to be proactive so that we can plan for that. Very, very important. So that's the first thing. We've got more employees on annual leave.

Impact of Annual Shutdown & Closure Periods
 
A lot of practices also have this mandatory shutdown periods or annual closures. That includes my very own practice. Personally, I like to close the practice for two weeks, because this is a mandatory holiday period.

Because I find that the people that come and work for my practice are such hard workers and it's like you guys are going to go on holidays whether you like it or not. And I find that two weeks are really the minimum if I reflect on my own functioning and we are all different right. I know that when I go on holidays it takes me a couple of days to just start switching off and I will be a little bit cranky and you know, because it's like I don't like not working.

I love what I do and then after like three days it's like oh, this is good. I'm enjoying this. What's that thing called work again? Oh, no, no, and then I get into the holidays and rest and relaxation and the sunshine here in Australia, going to the beach, the swimming pool, spending time with the kids.

It's like, I don't want to go back to work because this is just so much fun. And then I go through the other side and then I go, okay, it's time. I'm feeling rested. I'm feeling re-inspired. I've got all these new ideas that just popped into my head as I was lying next to the pool not doing anything because I had that space.

My brain wasn't distracted by emails and social media and all of that other stuff and then these ideas just popped into my mind, and I came up with strategies to solve issues that I had in the year and then I'm getting really motivated to go back to work. And then I'm like chomping at the bit for that day that I'm meant to be starting again to roll around.

And I find for me personally, that's two weeks. Now I'm pretty sure for some people that might be three weeks. For others it might be four weeks, but I feel like one week is just not enough to go through that process. And for me, that's two weeks, which is why I like to have a two-week annual closure period at my own practice.

And of course you do what is right for you and your team. But again, for me and my business, I know that we're not going to be making any money for those two weeks. And I know that happens every year. And I need to be prepared and plan for that. And it might take 12 months to be prepared and plan for that.

Which is why, if you are listening to this in January, you need to start now preparing for the end of your year when you might be having your annual shutdown. But this applies to any time of year, especially if you've got employees where you not only have a loss in billables, but you still need to pay them whilst they are on holidays.

Impact of Increased Cancellations, Reschedules & No-Shows

So that's the first thing. The other issue that practice owners report is an increase in cancellations and no shows. So the attendance rates of clients are very up and down. Now obviously, you need to make sure that starting December, you are engaging in very clear strategies to ensure that your January is completely booked out.

What we find is that there's going to be a lot more cancellations and no shows. Now as a practice owner that has a child and adolescent i.e. paediatric arm to the business, I can tell you that that is where most of our reschedules occur in the month of January, and I'm talking specifically kids that come in for therapeutic services because a lot of times our kiddies are part of the separated families, they might be staying with a different parent, they might be extending holidays. 

There's a lot of individual circumstances that come into play. And there's a lot of other reasons. But when I look at the data, most certainly there's more cancellations and reschedules and even no-shows for our child and adolescent clients versus our adult clients during the month of January.

I'm not saying it's not happening for adult clients; it's just more for the child and adolescent group. So again, by knowing this and having looked at the data, you can then start to make informed decisions around what do I need to do to optimize attendance of the clients. And there’s clear strategies that needs to be driven by the clinician team versus the admin team.

Optimising Attendance

So both those teams need to work together to optimise attendance. And it's obviously your job as the business owner to make sure that they know what that is so that they can proactively engage in those strategies, right? And those strategies need to be the proactive strategies in terms of what are we doing already during December to educate clients, for example, around the importance of continuing to come in for their sessions during the month of January. So that proactive client education needs to occur because, to me, it just makes sense that this is really the most important time of the year to keep coming.

And I think people actually need more support during this time. Just think about all the Christmas stress, the family dynamics that arise, when there's a lot of people that doesn't see one another that often. And they are all in the same house under the same roof or getting together consistently, there's over-indulgences happening.

There's deviation from your normal routines and habits. The sensory overloading that happens. Music playing, kids screaming and just a lot of stuff happening and as a parent of three kids, a lot of bickering you know. Just thinking about all of this makes me long for a session with a supportive psychologist to just give me some time out and calm my tensed up nervous system.

And I think a lot of people experience this, right? And yes, our clients might be on holidays from school and from work, but it doesn't mean that you take a holiday from your mental health. You don't put your mental health on the back burner. No, this is actually an opportunity to bring it to the fore-front and to go, this is a great opportunity to actually make sure that I look after my mental health and prioritize it even more than normal. 

And this is particularly important for clients who are in those initial stages of the therapeutic process. So those clients that are in six or less sessions. Also really important for clients with complex presentations, where there's a lot of relational presentations. And it's really important for us to make sure that clients know that they need to prioritize this.

I see a big part of our role as allied health professionals and mental health professionals is to advocate on the client's behalf and often to advocate for them with them. Because a lot of people that comes through our doors are so used to putting other people first. It's our job to model to them that they need to put themselves first.

And that might be a deviation from the normal face to face work. It's like, you know, you don't have to drive in, find a quiet corner or walk to a local park, put us in your ears, and let's just talk, but let's still prioritize you. Let's still prioritize your mental health because after that 50-minute session, you can go back into the craziness and sometimes that's beautiful craziness of the holidays.

You're going to be so much calmer. You're going to enjoy it so much more and you're going to tolerate all the craziness so much better. So it's actually a good thing to keep on having that support. But we need to educate clients on that rather than the client goes, Oh, it's going to be really busy, I might not come. And you go, yeah, that's fine. No. Go, all right, let's unpack this. What is happening here?

Proactive Versus Reactive Strategies

And all of that needs to happen, of course, in the lead up, but that's the proactive strategies versus more reactive strategies. And a lot of times when we hear the word reactive, we think that that's not a good thing.

But sometimes things happen, and we need to react. But if you have clear strategies that you can pull on and implement when you are in reactive mode, because as a business, yes, ideally we want to be proactive, but shit happens. And when shit happens, you need to know how am I going to act reactively in a good way, in a helpful way, in a resourceful way.

So you need to know what is the reactive strategies that I'm going to use. So if all of the sudden the bottom falls out of the week and like 50 percent of people cancel or reschedule, and we know that there's probably going to be a couple of no-shows thrown into there unexpectedly, what do I need to do right now?

And both the clinician team and the admin team need to have their go to plan i.e. strategies to remedy those situations. And I would want to ensure that each of them has minimum one thing they can do, which means there's two strategies, one for admin, one for clinician, but ideally three things each of them can do, working together as a team, to go, all right, how do we fill this? How do we fill this right now? What do we need to do? And there's clear strategies in there and I cover some of those in the handout that I referenced earlier that you can download in the show notes. 

To recap, the first problem leading to cashflow difficulties over January is that we've got team members away on annual holidays meaning that there is an automatic decrease in billables coupled with the fact that the majority of allied health businesses will also close for at least a couple of days - most I would say a week, up to two weeks. Some people close for three weeks. I'm actually aware of a practice that closes for six weeks. As I said, we do two weeks at my practice. 

And then of course, the second problem was fluctuations in client attendance caused by cancellations, reschedules and no shows. And then the third problem that emanates from the first two is cash-flow. And a lot of people have a lot of up and downs in those cash-flows, but it's mostly negative cash-flow. In other words, more money is going out than is coming in during that month.

Now the thing about cash-flow is this. It's a cash flow. Money's coming in, money's going out, money's coming in, money's going out. And if you know that January is a month where there's more money going out than coming in due to the previous two issues, problems that we've just mentioned, now you know that there's an issue with January and now you can implement strategies. 

The easiest, most effective thing that I can recommend to you is to now, the moment you listen to this, is to open up an additional business account, just an online savings account in your business and start putting money away.

Look at the shortfall that you had this year. Add at least 10%, ideally 20%, and go, this is my target amount that I want in this account come the 1st of December this year. How much do I need to pay on a weekly basis? Set up an automatic payment. Money goes straight into that account. But of course, you need to have the discipline not to touch it.

If you think you're not going to have the discipline, then open up a bank account at a bank that you don't normally bank with. Make it separate. Don't have that app on your phone. Just do what you need to do not to touch that money. So yes, there's a lot of discipline that comes into play here, but discipline is a skill and discipline is a muscle.

You need to practice it but do that and you will thank me later. That, of course, is a very proactive way of making sure that there's money available during that time. Now given the state of your business, that might be hard to do if you've got a bigger, more general overall cash-flow problem. You might not even be able to do that. If currently you are running a business that is running from pay cycle to pay cycle, you might be going, well, good, I don't have extra money to put in there.

Okay, that just alerts you to the fact that there's a bigger issue here that you're going to have to address, and one option is to just be an ostrich and put your head in the sand and just go, I'll just keep on doing what I'm doing, and it will sort itself out. I've got 12 months. I can tell you that's not going to happen.

Mindset Challenges & Strategies

That's the one thing I have learned the hard way that just working harder and working more is not going to solve these issues. You need to have the clarity, and you need to stare these issues in the eye, and you need to first go through the I'm such a bad business owner self-talk. You need to go through the pity party of the fact that you are so bad at this, and then you need to pick yourself up from the floor and you need to step into beast mode in a nice way - a nice, pretty beast way.

And you need to go, all right, F this. I'm going to fix this shit. I call it fight mode. I go into fight mode. Like I am ready. I am so ready. I'm going to win this. I'm going to do this. I call it my fight mode, but not an aggressive, violent type of thing. Just like, this is not going to beat me. This will not beat me. What do I need to do? 

And then I do that freaking thing. But I also make sure if I don't know what to do, because what I have been doing hasn't been working, I need to have the humility to accept that. I need to go, all right, I need to check my ego at the door and ask for some help.

And based on that problem I might ask specific people who I know are experts in this area to help me to fix this problem. And that's the one thing I also want you to take from today is that it is okay to ask for help. We tell our clients this every freaking day, but it's like, that's good for them, but I'm not going to ask for help. I need to sort this out myself because I'm a clever person.  If I could be a psychologist and surely I can figure this out myself. Yeah, why? Why would you do it the hard way? It doesn't make sense. I guess it does, but it doesn't. Anyway, ask for help. 

We've started today with bringing things to awareness to go, okay. I'm now aware this is an issue. Awareness, proceed to change. Now I need to decide. Am I willing to change this going forward or am I choosing to continue to learn this lesson over and over and over? And you know, it's tricky because January only comes around like once every 12 months and it's easy to forget the lesson and then go, oh, I'll do it better next year.

And then before you know it, it's been five, ten Januarys and you're still learning this exact same lesson, but it's not being embedded. So become aware, choose to make the change and then have the humility to accept the help. Step into the, okay, I can do this. I'm not going to feel sorry for myself. I'm going to step into my version of, you know, being strong and fighting this.

And I'm going to make a plan and I'm going to freaking implement the plan. I'm going to implement this strategy starting today. If you're listening to this in January, start today. If you're listening to this in November, start today. Alrighty, and if it is November, you're not going to be ready in January.

It is what it is, but you're going to start today to be ready the next January. All right, by putting money aside because you know that you're going to need additional cash during December and January when you have your annual closure period, you're going to have your proactive strategies for both the admin team and the clinician team to fill the diaries and to keep them full and to refill, which is the reactive strategy.

So proactive is to fill, reactive is to refill when people start to cancel as a result of whatever's happening for them.

I'm going to leave you with the knowing that there is no reason why January should not be just another month in private practice. Just another month where you have a clear revenue and profit goal and where you achieve that. But it's up to you to implement the strategies to make that happen. So don't forget to download the handout called, Cull the January Lull for five really clear, detailed strategies on what you can do to get that done. 

All righty, we're going to leave it at that. Thank you so very much for tuning in and as always, remember that I am here to help you build a practice you can't stop smiling about :)

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Gerda Muller

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