How A Chiropractor in Montana Increased His Profit by $109,200 a year in 45 minutes

…while working 4.5 hours a week less.

How A Chiropractor in Montana Increased His Profit by $109,200 a year in less than 45 minutes

…while working 4.5 hours a week less.

The Success Finder Association¹ is largely inspired by Nic Petersons book, Bumpers². Nic - who is a partner in the association - has a way of flipping the way people think on its head to reveal what’s often hidden in plain sight. But thinking differently is not enough, we have to do differently.

Below is a breakdown of how a Chiropractor in Kalispell, Montana added $109,200 a year in profit through Nic’s “Recapture and Reallocate”³ process. The basic strategies used to add $109,200 to the bottom line are available to every business owner.

The Business

Topline Revenue: $1,2500,000
Profit Margins: 25%

The Process

Nic has a simple set of rules:

1. Don’t do new things that violate your own economic and personal principles. If it gets you further away from what you want, don’t do it. In other words, do less stupid stuff.

2. Do less of the stuff you’re already doing that violates your economic and personal principles. Staying in stupid stuff is the same as making a new stupid decision every day.

In other words, don’t push harder on the gas while you still have a foot on the brake(s). Most chiropractors we talk to are violating their economic principles multiple times a day - and are completely unaware of it.

Here’s a quick test.

If you had a choice between spending an hour on the phone to close a $2,500 sale or spending that hour doing some mundane task(s) to save $900 instead - what would you do with your hour?

Now think about it this way:

A $2,500 sale at a 25% profit margin adds $625 to the bottom line while increasing

• Risk

• Obligation

• Overhead/costs to fulfill

Saving $900 adds $900 to the bottom line while likely reducing:

• Risk

• Obligation

• Overhead/cost

Given the choice between more cash with less risk and less cash with more risk, most business owners choose the latter - they’re violating their own economic principles because of the way it’s presented.

The following process took 45 minutes and added $109,200 to the bottom line - The Equivalent of $436,800 in New Sales

Phase 1: Basic Recapture

The first step is to recapture what is being wasted and plug the leaky bucket stuff. It’s super simple. Recapturing small expenses is just the first step.  There are often monthly, quarterly, and yearly recurring expenses that business owners don’t notice; redundant software, overpaying for enterprise accounts, free trials that were never canceled, etc.

There are also habitual expenditures that are triggered by recurring events, bloated expenses that can be trimmed, and “Opt-Out” costs that can be turned into “Opt-In” costs.

Basic Recapture Steps:

1. Eliminate. Using your bank statements or something like QuickBooks pull a year of statements and ruthlessly eliminate all recurring expenses that are not essential to your practice. Go back a full year, otherwise those pesky annual payments will slip through the cracks.

Remember, you can always opt back into any of those expenses if you end up needing (or just missing) them. The important thing is that you’re now in a position to “opt-in” instead of having to “opt out”, meaning you’re less likely to violate your principles.

2. Add. Add up all the expenses you’ve eliminated and annualize them. This is an important step, you’ll see why. For example: $109,200 a year.

3. Divide. Divide your total recapture number by your profit margin. For example: $109,200 / 25% = $436,800

4. Make A Statement. Fill in the blanks and then write it down or say it out loud:

“I just recaptured $_(total from step 2)__ a year which is the equivalent of $__(total from step 3)__ in new sales.”

Phase 2: Advanced Recapture

The basic recapture steps apply to every business owner on the planet. Advanced recapture is slightly more complex because it depends on many factors including the state of incorporation, current tax strategies being deployed, and personal situation(s).

Advanced recapture opportunities are often the things we set up once. a long time ago, and never thought twice about it because it’s “just the way it’s always been.” They are also the most likely to creep up, become a problem, and knock you out of the game.

While they are less cookie-cutter and require more personalization, the advanced recapture steps can decrease risk and increase profit exponentially for practice owners.

Advanced Recapture Steps

1. Audit Your Health Insurance. Nearly everyone making over $100,000 a year that we’ve talked to is overpaying for health insurance - sometimes by $300-$600 a month! More importantly, they are also undercovered - and have no idea. Don’t forget your employee’s insurance and workers comp if you offer it. Note: most of the best health insurance options are hard to find and are only available to members of an association. Don’t worry, we have a solution for you in the resources.

2. Advanced Tax Strategies. There are tax advantages available to but rarely used by Chiropractors. The most common tax advantages and strategies for our Chiropractor friends are listed below. We’re not CPAs so ask yours about the ones that apply to you.

   1. The Augusta Loophole (Average of $14,000 a year recaptured)*

   2. Equipment Depreciation (Average of $102,440 a year recaptured)*

   3. R&D Credits (average of $17,000 a year recaptured)*

   4. Pay children tax-free. (Average of $12,000 per child allowed)*

*The data above is self-reported by practice owners and confirmed, with their permission, by their CPA or tax professional. We did not include any tax strategies in our calculations in the article since we can’t help you with tax planning.

That’s it.

It’s so simple and obvious it’s almost boring because once again…

GET ACCESS TO BETTER OPTIONS:

Get Your Free Association Membership and Free Insurance Audit courtesy of the Success Finder Association and Georgia Chiropractor Association. (Don’t worry, nobody will try and sell you anything)

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Additional Recapture Resources:

• Priceless: The Look On Her Face by Nic Peterson. Another Recapture and Reallocate case study

• Recapture and Reallocate by Nic Peterson and The Guardian Academy

• Get Your Free Association Membership and Free Insurance Audit (Don’t worry, nobody will try and sell you anything)

To Your Success,

The Success Finder

1. The Success Finder Association

2. Bumpers Book

3. Recapture & Reallocate