Loan comitment!

Woohoo!! Good news. We've got a commitment letter from both banks: the local bank to fund our building purchase, and an optometric lender for the practice.

Our practice (PLLC) will lease from our building corporation (LLC).. there are several advantages to keeping the two separate, I'll go over those another day.

Timeline of events so far:

• May 30-we found our building
  
• June 4-incorporated LLC with the State
• June 12-executed contract on the building with attorney
  
• June 12-local bank gives us commitment letter for building
• June 17-hired inspector to evaluate property
  
• June 25-practice lender gives us commitment
  

Our loan

We intend on purchasing the building now and holding it, simply because the location is GREAT! The building was actually owned by an ophthalmologist 10 years ago, so remodelling it will be easier (hopefully). We dont plan on occupying the space until we've finished our contract with the seniordoc, set to expire next July. BUT, this gives us plenty of time to get everything in order.

1. I actually applied with two different SBA lenders (7a loan) to finance us for the building purchase and the practice loan. I made them compete with each other to get the best possible rate. They agreed to finance us over 25 years with Prime+2.25% as our rate. Total size of loan: $588,000
2. Then I applied with a local bank (for the building), and an optometric lending company (for the practice loan). This would be the best option for us, and would keep our business local. Total size of loan: $660,000

Favorite Optometry pertinent websites

These resources have helped me tremendously over the last several years..

www.odwire.org The holy grail of optometry websites
www.proactod.org (exclusive version of ODwire, great for discounts!)
www.optiboard.com (Join the ProForum, and learn how to make money with your optical)

There are countless individuals on both boards that share their experiences in our profession. Being an optometrist isn't easy, so I'll take as much help as I can get.

Critical updates

1. About two weeks ago we formed our first ever corporation, an LLC to "own" real estate. It Cost: $750 on mycorporation.com, pretty easy to fill out, and we also got a Tax ID with it. It should be arriving today in the mail, which includes our certificate of formation, articles of incorporation, and Federal TaxID (FEIN).
2. We executed the contract on the building we found last Friday!! There was a 3 day time limit on when we had to get the "earnest money" to the title company. Cost: $3,000. I FedEx'd it to them the same day ($21).
3. Then the same day, we got a committment letter from the local bank. They requested an $800.00 check to start the appraisal process. I FedEx'd that on Sunday night ($21)
4. I ordered an inspection of our potential building today ($480 for inspection, $120 for termite evaluation). I've gotta be comfortable knowing this property before I sink my life into it. The inspector will have our report this week.

Jeez, we're spending money like its going out of style!!

We also managed to find an attorney to represent us ($1000 retainer fee, and billing us $255 an hour. OUCH!!!). He is very quick at getting to us and always a phone call away, but to be honest.. I asked him way too many basic questions, stuff that I should've used a real estate broker for. I would reserve using the attorney ONLY for reviewing contracts. During the negotiation process attorneys should make you understand the language in your contract in plain english.

Also, we found a local CPA to use. I'll post his prices later.

Major updates

Its been a few weeks since I've posted. It seems as though every time I post, major changes have occured. Well we've decided NOT to stay here for 2 years.

Here's the kicker.. do we want to stay the entire 1 year, or leave sooner????

Well we've been scouting properties in our future town, and even got a realtor working for us. We've come to the realization she's not very good, because we were able to find out more about buildings and properties by calling ourselves and doing our own research. One building used to be an OMD's office (who left town), then converted into an attorney's office. We were pleasantly suprised when we looked at it today, discovering the optical, front desk, the exam lanes in virtually the same condition. Our realtor couldn't even get us in touch with the owner of the place, or with his broker. I managed to find out their information on my own, and met them today.

Looks like we're going to need more money. Matsco approved my loan for 330K, but.... it was intended for a "lease, buildout" not a building!!

How to start a business 101

I'm going to squeeze in a quick post before I forget, and my next patient.

Its basically a 4 step process:

• file with your state to form a business,
• apply for a tax ID,
• get sales tax permits,
• and learn labor laws. Great.

Next, I'm in the middle of making a "timeline" style reminder list to organize everything that needs to be done before we open our doors. Doc Softy stressed that she really wanted to be on the same page, and figure out which tasks needed to be delegated. No prob!

Conundrums & Dilemmas.. What to do?

Well the last two days have been interesting. Doc Softy and I have been planning out our options so that we can get the ball rolling on our first private practice. We knew we were going to extend our contract for one more year with the seniordoc we currently work for. I actually asked her for a raise. I was expecting a counteroffer but to my suprise, thats not what I got.

Well here's whats changed. They accepted my raise but proposed a counter offer. If we extend our contract for two years, it would effectively be giving us a $40,000 raise annually!! Damn! I wasn't expecting that. For them, its a smart move because it keeps their practice stable and they dont have to go through the energy of finding new doctors.

So we quickly had to decide what we were going to do:

• Extend our contract for one year and try to startup cold next year in "Smalltown"
• or Extend our contract for two years, save more money.. but possibly lose our opportunity in Smalltown if another doctor opens up before us

Thinking we had to make this decision quick, we decided to visit Smalltown this weekend. When we got here we toured the location's main streets, spoke to a few locals, walked into the Wal-Mart to get a feel of the community mix, and met up with a realtor.

Heres our next problem... we calculated that we could open up in Smalltown and do well our first year BUT (theres always a but right?) we cant find a good location!! We want to be open close to Doc Competition and on the main drag, but after our recent search there seems to be nothing available for sale, or lease :(

What to do...

Current situation

On an average day at this practice, I see anywhere from 18-24 patients depending on the schedule. The seniordoc purchased this practice from a retiring doctor when it had yearly sales of about 650K. About 5 years later plus some elbow grease, the doc brought it up to 1.6 million!! Amazing.

On average an optometric practice will net about 30%. I wouldnt be suprised if the seniordoc took home about 500K. This is by far the exception and not the rule.

Ever since I joined this practice, I've helped boost the practice gross in several ways: fee increases, properly billing/coding, optical recommendations.

So why did I take this job? Well, the pay is great! More importantly, we actually had the opportunity to work a few days together at a second office. We wanted to try it so Doc Softy and I could see if we could handle owning a business together someday. 10 months later, we've realized that we work together well and that we can do this on our own. Its definitely scary, and risky.. considering we've got a mountain of loans (300K owed) and we've got one extra mouth to feed. The other reason we've decided to get out of here is because our boss is simply ungrateful, and mean. Doc Softy gets along with everyone, and even she agrees that our boss is difficult to work for. Another reason to start your own practice folks!!

During my downtime at this practice, I've been looking at getting a practice loan, "window shopping" for my practice, and researching towns to open in.

As Borat would say.. "grrreat succccess", I've found a town that I think would work.

Woowee! First post

What's up readers? I'm excited about this blog for several reasons:

• one.. because, its going to give me something extra to do because I'm a chronic self-actualizer,
• two.. maybe someone might find this blog useful enough to help themselves

Background: Im in my late-twenties and have been married to my college sweetheart since. I graduated from optometry school and have been practicing for another doctor since then..

My wife is also an optometrist and she is the love of my life. My dream has always been to own a private practice for as long as I can remember... I love the business aspects of optometry and love to be a clinician.

For obvious reasons, our personal details have been omitted.