There are several areas where it makes sense to save when opening a practice.
On the other hand, there are some areas where saving money can be a false economy. When purchasing new equipment for a dermatology practice, the most logical thought is to try to save money and purchase the middle of the road forceps, needle drivers, and other instruments. This is what I did when I first started, but shortly after this purchase I regretted that financial choice. Time was lost during procedures and the instruments were constantly being replaced.
Instruments can make or break your practice as a surgeon and good ones. In particular, can burnish your reputation and save hours (if not days) over a career. Additionally, the “gold-tipped” instruments can often be repaired for life, saving a huge amount of money over the life of a practice.
While spending more money doesn’t often seem to be a wise choice, this is one situation where clearly it makes sense and can return a nice result over time. There are other corollaries to this scenario, but in general they aren’t as black and white as this one instance.
For example, when purchasing a laser, it helps to negotiate an extended warranty price. As it often turns out to be much less than purchasing that earlier rather than later. Payroll is oftentimes another area where cost savings don’t make sense in the long run. Having well trained and educated personnel can make you look great. While having a shoddy practice with poorly informed staff can drive current and prospective patients away. Oftentimes, the differences in talent acquisition and salary are minimal and can be made up within a week or so if personnel are recruited or retained.
Where it is appropriate and reasonable to look for savings, it is an entirely different discussion, but the largest area of opportunity is in contracts. Read contracts carefully or send them by a trusted advisor or attorney before you even think of signing them. There is often an easy way to negotiate a lower rate. A more favorable interest rate or some aspect of the contract that will make life better for you over the course of that contract. And always look at the “exit strategy” for every contract. This will pay you dividends over time as poorly executed contracts. Whether they are with a trash service or an insurance carrier, are an ongoing potential source of economic losses.