E651 | Where To Reinvest In Your Business

In this episode, we look into the various areas of a business that owners can strategically invest in to generate a substantial return on investment. One of the key areas highlighted is investing in people, specifically hiring staff. By bringing skilled individuals on board, businesses can often generate more revenue than the cost of their salaries, making it a highly beneficial investment. 

Moreover, we emphasize the importance of investing in education and continuously learning how to effectively run a business. This knowledge is invaluable, as it cannot be taken away from you and can greatly contribute to the overall success of your venture.

For service-based businesses, investing in a standalone space is often necessary. Having a designated space to work with clients can significantly enhance professionalism and client satisfaction.

Additionally, marketing is discussed as a vital investment. However, it is acknowledged that it can sometimes feel like a gamble, as results can vary from month to month. Therefore, we advise business owners to initially focus on building a strong local reputation through reviews and word of mouth before diving into broader marketing efforts.

Another area of investment that shouldn't be overlooked is appropriate technology. Incorporating efficient technology into business operations can save a significant amount of time and streamline processes, ultimately leading to increased productivity and profitability.

Overall, we stress the notion that investing in your own business has the potential to yield a much higher return than passive investments, primarily because you have control over the outcomes. By strategically investing in people, space, knowledge/education, marketing, and technology, business owners can significantly grow their ventures and increase their overall value. Tune in to gain valuable insights on where to reinvest your money within your business to drive growth and success.

Up for a Challenge? Try our 5-Day Challenge Here! https://www.physicaltherapybiz.com/challenge 

www.physicaltherapybiz.com/apply

Do you enjoy the podcast?  If so, leave us a 5-star review on iTunes and tell a friend to do the same!

Are you a member of our free PT Entrepreneur Facebook Group? Join today!

Podcast Transcript

Danny: The other big area that most people have to reinvest in is in a space is in a location. So a standalone space in particular is typically the direction that most people go. Those standalone spaces are important because if you're a brick and mortar business, a service based business, you need a place to work with people.

And if you don't have a space for somebody to work with somebody, then you're going to be limited by that. So that might be you reinvesting into a space that requires money to go towards.

Hey, are you a physical therapist looking to leverage your skill set in a way that helps you create time and financial freedom for yourself and your family? If so, you're in the right spot. My name is Danny Matei. And over the last 15 years, I've done pretty much everything you can in the profession. I've been a staff PT.

I've been an active duty military officer, physical therapist. I've started my own cash practice. I've sold that cash practice. And today, my company, Physical Therapy Biz, has helped over a thousand clinicians start, grow, and scale their own cash practices. So if this sounds like something you want to do, let me know.

Listen up. Cause I'm here to help you.

Hey, what's going on? Dr. Danny here with the PT entrepreneur podcast. And today we are talking about investing in your business. And in particular, what areas of your business can you invest in that will create a return on investment? So when I got out of the military in 2014, I had a conversation with, uh, one of my mentors, Kelly's Tourette about, uh, saving.

And I was a. Just lifelong. I don't have a lifelong. I was a long term saver is a good way to put it. Uh, you know, I had started a Retirement savings account when I was 17 years old. Maybe as 18. It was 18 the summer Before I went to college and I had worked as like I was like managing a pool that summer and I'd made a couple thousand dollars that summer and I just Didn't want to pay taxes on it because I remember going to a local bank and told them I was like, all right Well, I don't want to pay taxes on this money.

So what what vehicles can I put it in? Because I don't really need it right now Uh, you know, I had I had like some money that I that I had set aside but I wanted to Put money into something that I would have to pay tax on and they kind of laughed at me and they were like you didn't Make enough money to pay taxes first of all Um, and then they basically helped me set up a roth ira basically so from the time I was 18 until I was 29 When we got out of the military, I, uh, I saved money towards that every single year.

And when we got out, I remember I had a conversation with Kelly and he said, he's like, I wouldn't put a dollar into anything besides your business. You have to look at your business as like investing. You know, stocks and mutual funds or whatever else, you know, you're putting money into from an MS and investment standpoint, you have to take that, uh, those resources and turn that towards your own company, which has a far bigger potential return on investment.

And it was kind of hard for me because I spent a decade building this habit of saving. And all of a sudden I wasn't doing it. It felt very. Unnatural to me, but what he meant by that, I didn't really understand for a while, but I just knew he knew more than I did. So I did it and we started taking the money we were making from the business, the money we would set aside for, for different retirement accounts and whatnot.

And we were putting it back into the business. Now, when I tell people to reinvest in their businesses, uh, it's a vague concept, right? And I didn't really understand it whenever we had this conversation, but there's areas that you can reinvest it. Increase the value of your business, uh, and, and increase the nonactive revenue within your business, which is also important.

So a few areas to really think about that are simple places to start from a reinvestment standpoint are in people. So hiring, whether that's administrative support, uh, that's actual staff that is, uh, that's seeing patients. So clinical staff, maybe it's training staff. If you have like a training element, like a physical training element to your business.

Um, but people are a huge asset. It's a, it's an investment and you're investing in them with their salary, 90, 000.

But then they generate 250, 000 for the business. That is a pretty damn good return on investment. Now, obviously it's not all profit because you have to pay for facility and insurance and taxes and all that. Like there's overhead and there's a number of factors associated with it, but you're basically, uh, investing in other people in order to create more profit in the business, right?

As well as nonactive. Revenue meaning you're not the one fulfilling everything and the the less that you do as odd as it sounds the less you do the more valuable your practice actually is because If someone's to buy your business, they can't buy You you doing everything, you know, so like they could but it wouldn't be worth anything because if you left Then there wouldn't be anything really to show for it Uh, it would be worth nothing.

So Nobody's going to buy that. They want to buy something that they know is predictable. That's going to be generating revenue, uh, even if you're not there. So every step you take away from being the one doing everything makes your practice infinitely more valuable, right? So you need people in order to run the business.

You need to create systems and processes to be able to run the business. If you don't know how to do that, one of the first places you can reinvest is in your own. Business education, which is for us is exactly what we do with people at PT biz is we teach great clinicians how to be awesome business owners.

And that's something that is a skill that, that compounds probably more than anything I'll, I'll even bring up. It compounds a lot more than hiring a staff member because that staff member. They could leave. Maybe it's a bad fit. You have to fire them. Uh, you know, it compounds a lot more than a standalone space.

You know, you, you, you, uh, you can definitely hire and, and bring more people into a standalone space. But again, like, you know, you, maybe that doesn't work out and you have to break that lease or something, but no one can ever take information away from you. It can't take your knowledge away, especially if you do a good job of learning it and implementing it.

You become. Far more valuable to the economy in so many other ways than just the clinical side. So if you don't know how to run a business, the first place you can reinvest is learning how to actually market, sell, hire, lead people and systemize, uh, your business to where. People can actually run your plays and, uh, it's, it's running it very, very consistently without you having to necessarily be there.

Hey, sorry to interrupt the podcast, but I have a huge favor to ask of you. If you are a long time listener or a new listener and you're finding value in this podcast, please head over to iTunes or Spotify or wherever you listen to the podcast. And please leave a rating and review. This is actually very helpful for us to get this podcast and really help them develop time and financial freedom.

If you would do that, I would greatly appreciate it. Now back to the podcast,

the other big area that most people have to reinvest in is in a space is in a location. So a standalone space in particular is typically the direction that most people go. Those standalone spaces are, um, important because if you're a brick and mortar business, a service based business, you need a place to work with people.

And if you don't have a space for somebody to work with somebody, then you're going to be limited by that. So that might be you reinvesting into a space that requires money to go towards. Building things out and designing it and equipment, uh, and making it, you know, look the way that you want. It's actually one of the more fun parts of one of these businesses where you get to really put your stamp on what your local business is going to look like, what your office is going to look like, how much of it is going to be gym space, how much is treatment room space, like what are the colors, what, what equipment goes in there, what flooring goes in there, you know.

Everything you get to pick that you get to design that and that's a really cool thing, but that does cost money And that is a reinvestment in the facility like you're not going to do that and then just it just you right? You're not going to build out a 3 000 square foot brand new facility And then it's just you working with people in there because then you have this all additional overhead and no additional revenue Right.

So people are a big reinvestment. The space is a big reinvestment and then the other areas Aside from knowledge, people in space, it comes down to technology and marketing. And I think marketing is something that you have to keep in mind is an investment, but it can feel more like gambling sometimes than an investment.

Um, you know, this is something that for me, I typically recommend clinicians do not right away start with paid ads. I think it's a, I think it's a bad idea if you don't have any sort of local reputation, if you don't have any sort of social proof with, you know, Google. Uh, reviews, Facebook reviews, Yelp reviews, whatever is big in your area.

Uh, and also if you don't have any word of mouth presence, uh, with people who will talk about your business in a positive or negative light, whether you know it or not, uh, it's happening when you start to work with people. So if you, if you look at digital ads in particular as an investment, um, wouldn't you want to do that in a manner where it's going to have the best payoff?

So for you being able to. have this social proof where people are going to inherently look you up. You know, it's not like somebody just sees an ad and they, and they say to themselves, yes, I'm going to do that. Like I'm going to come in and see these people. They're going to look, they're going to look up your business.

They're going to look at reviews you have. They might talk to friends about you or if they've ever heard of you, if they, if they know anybody that's worked with your clinic, uh, and that's a normal path for most consumers. Just think about yourself. So. If you're running ads and there's nothing like you have this, no presence really whatsoever.

You look like a brand new business with a terrible digital footprint. Then your return on investment on marketing dollars is going to be really bad. It's hard enough to make it win, even if you do have a good presence. But if you don't, and you do that, then you really shoot yourself in the foot. Now, once you get yourself to a point where you have an established local.

Uh, presence, right? Good reputation. And you want to start layering in, uh, you know, uh, digital advertising. You can do that. And, but you also got to look at it as an investment because you might not be right, uh, early on. You might not be right each month. It changes quickly. It's something that you have to.

Change offers and of all of what you're doing, um, but you could spend 5, 000 in a month on ads and not get any clients from it. Right. That sucks. That's happened to us. Uh, whereas like you can run the same ad the month before, same, same group of people and you get, you know, 10, 15, 000 of business from that you can generate from that, from that ad.

So you have to look at it as an investment, as something that is, uh, you know, going towards reinvesting in your business to gain more new, uh, new clients, but it's almost more, it is an investment, but it's more like a gamble of an investment. You really have to know what you're doing with that in order to make that, uh, make that work.

But if you can make it work, then it can be a great reinvestment in the business. The other big thing that adds a lot of value to the business and a lot of, uh, time saving for you is appropriate technology. So technology and businesses is a investment it, especially if it allows you to have, um, better tracking, more consistency, uh, and organization of your business, then it's a win and it's a win on a number of levels.

It allows you to manage the business remotely with less, um. You know, with less of a challenge in terms of trying to figure out what's going on. It also allows you to package that business up and have somebody else run it if you want to autopilot it Or to sell that business So the more well sort of organized and put together the businesses the more valuable it actually is and technology can be really really helpful uh with with doing that right so whether it's a Um, you know, a project management software, an EMR, a, uh, a CRM of some sort, uh, you know, you can manage things really quite well with a few different softwares.

And it's something that, but it could cost you a few hundred bucks a month, like as a tech stack, uh, could cost you. But that's something that for you, it's like, let's say that costs you 800 a month to have all the software you need to be able to run a practice at scale, but it saved you. You know six hours a week or 24 hours a month Just you not having to go and try to find all the relevant information that you're looking for.

Is that worth it? I mean for sure Uh in my opinion if you save me 24 hours a month of doing something like All day and you'd be shocked how much time people spend trying to find information In their business versus that actually being well organized and and uh easily Um, you know easily found in order to make decisions that you want to make on it So the big things are number one Keep in mind, if you don't have the information, don't have the knowledge, you got to go get the knowledge.

It's just like going to PT school. You know, if you don't know how to become a, if you don't know how to be a physical therapist, you got to go learn how to be a physical therapist, right? Like that requires mentorship and education. Same thing on the business side. If you don't know anything about business, why, what makes you think that it's going to be easier for you to figure that out then to like treat somebody's lower back pain, it's way harder to run a business than it is to actually like get somebody's lower back to feel better.

Uh, so make sure you're investing in yourself. No one can take it away. Get the skills and the knowledge that you need in the network. That's a big one from there. You got to have a space. So reinvesting in a space, reinvesting in people, these are the sort of building blocks to any service based business.

And then you got marketing and you got technology and those, those in a lot of ways go to hand in hand, uh, because you're going to track a lot of marketing with technology as well. Uh, but those can add a lot of enterprise value, a lot of, um, uh, like. True value to the business that allows you to either get time back be able to have somebody else run it or to be able To sell it at some point if that's what you decide to do So when you're looking at your business as an investment, I think it's the best way to do it But these are some areas where maybe it's not quite as vague like, you know, hey, what do you mean?

What do I invest in? these are the things that really give you a big ROI and it requires your time and it requires your you know your effort but The return on investment from a business that you own is exponentially more than you just passively investing in some sort of index fund, uh, or an individual stock or whatever, like, and you have so much more.

Predictability over how that business is going to do because you're the one driving the ship. So if you're, listen, if you're going to drive that business like off a bridge, that's on you, but you could also drive that bridge, that business to a really successful place as well. So you've got to just be willing to take that, uh, take that responsibility.

And like most of you that have started a business, you're obviously well aware of that and you're willing to take that, uh, take that risk. So those areas that can help as far as reinvestment is concerned. I hope this helps you as always. Thank you so much for listening and we'll catch you next week.

Hey, peach entrepreneurs. We have big, exciting news, a new program that we just came out with. It is our PT biz part time to full time five day challenge. Over the course of five days, we get you crystal clear on exactly how much money you need to replace by getting you ultra clear on how much you're actually spending.

We get you crystal clear on the number of people you're going to see and the average visit rate you're going to need to have in order to replace your income to be able to go. Full time we go through three different strategies. You can take to go from part time to full time. You can pick the one that's the best for you based on your current situation.

Then we share with you the sales and marketing systems that we use within our mastermind that you need to have as well. If you want to go full time in your own practice. And then finally, we help you create a one page business plan. That's right. Not these 15 day business plans. You want to take the small business association, a one day business plan.

It's going to help you get very clear on exactly what you need to do and when you're going to do it to take. Action. If you're interested in signing up for this challenge, it's totally free. Head to physicaltherapybiz. com forward slash challenge. Get signed up there. Please enjoy. We put a lot of energy into this.

It's totally free. It's something I think is going to help you tremendously as long as you're willing to do the work. If you're doing, doing the work, you're getting information put down and getting yourself ready to take action in a very organized way. You will have success, which is what we want. So head to physicaltherapybiz.

com forward slash challenge and get signed up today.