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Derek C. McCalmont M.D., M.S. Management  35y.o.  Retire at 50.  Live to 100y.o. (die penniless)  Inflation 3%  Returns 5%  Spend $150,000.

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Presentation on theme: "Derek C. McCalmont M.D., M.S. Management  35y.o.  Retire at 50.  Live to 100y.o. (die penniless)  Inflation 3%  Returns 5%  Spend $150,000."— Presentation transcript:

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2 Derek C. McCalmont M.D., M.S. Management

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6  35y.o.  Retire at 50.  Live to 100y.o. (die penniless)  Inflation 3%  Returns 5%  Spend $150,000  $7,578,643 per ING

7  Same Assumptions Plus  Income $290,000 (inc. spouse)  Savings $  IRA $  Contributions 5%  Includes Social Sec.  $5,116,378 per CNN  IF- Portfolio returns 11.4%  Likelihood- 21%

8  anner/retirementplanner.jsp anner/retirementplanner.jsp  finance/calculators/retirement/ finance/calculators/retirement/  t-calculator.aspx t-calculator.aspx  sting/investment_help/retirement_planning/r etirement_calculator

9 BIG !

10  What Can We Do?

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16  Start A New Business!

17  Coffee  Donuts  Medicine

18  Franchise Opportunities

19  Well over 3000 franchise businesses in U.S. with 2-10,000+ units.  “Over 50 franchises are sold each day”- Economic Outlook  Top 106 Franchises= 9945 new units/yr.  10 largest franchise systems=%50.2 total sales  Many offer multiple levels of investment/opportunity from different sized single units to multiple units.  Bricks and Mortar vs. Home vs. Internet

20  Who’s #1?-  Quick Service Restaurants- Sandwiches (6), Frozen Yogurt (4)  Senior Care (10)  Commercial Cleaning- low start-up costs  Janitorial Services- 3 in the top 10.

21 Love at First Sight Since introduced in 1966, close to 6.5 billion Slurpee® drinks have been sold, almost enough for every person on the planet

22  Franchise Fees- $0-$100,000+  Standard Royalty Fee- 6% of gross  Advertising- $? Usually goes into a regional budget which may or may not benefit your location.  Total Investment- $2000-$13.5 Million (Hampton Hotels)

23  Business Plan- Needed to secure financing  Detailed operating model- limited ability to adapt (Bigger the company, less variability)  Brand-  Training- None to months  Franchisee support  Software

24  Minimal Info on-line  Complete an information form (financial)  Sign a non-disclosure  Attend a “Discovery Day”  Obtain a Franchise Disclosure Document  Do your own industry research- all franchises predict growth of their industry- no different than any non-franchise business

25  Governed by FTC rules  Several Hundred pages long.  Item 19: Financial Performance Representations”?”

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28  Multiple Locations only  Only 4 markets available in the U.S.  KK Factory Store- $1M  Finances- $1M in liquid assets, $2M Net Worth.

29  Franch. Fee $40-80K  Royalty Fee 5.9%  Total Inv. $310K-$771K  Coffee makes up 60% of sales  Margins on coffee “exceedingly high”  Coffee>breakfast sandwichs>donuts  IPO June 2011 $19…March 5, 2013 $38.15

30  270M Potential Customers  70% drink coffee= 189M  Seattle has 1 coffee shop per 2,500 people  Nationwide 24,000 to 1  Currently 12,750 shops (SBUX 6,700)  Mature market 7,500-1 or 30,300 shops  Regular customer is worth $700/yr.

31  Franchise Fee $30,000  Initial Investment $176-$340K  Royalty and Marketing 9.24%  Net Sales per cup $3.24  Cups to break even 263  Assumes owner functions as manager AM shifts (assists with customers when busy)  363 cups/day = approx. $100k profit/yr.  How many can you sell?

32  Pro- Modest start-up costs  Pro- High Margins!  Pro- Relatively easy to learn operating model  Pro- Growing market (? Less ideal locations)  Con- Owner as manager (to start)  Con- Employee turnover/training  Con- Need multiple franchises to make economic sense for doctors  Con- Retail experience helpful (but we have customer satisfaction experience).

33  Open for 30+ years  8700 centers in the U.S.  85% Open 7 days/wk.  Avg. 342 patients/wk.  Over 150 Million Visits Annually  50% physician owned  21.7% Emergency Medicine

34  Increased Access  Lower Cost  Improved Quality ?  Only 57% of Americans with a PCP have access to same or next day appointments  63% report difficulty with access on nights, weekends or holidays.  20% of adults waited 6 days or more to see a doctor when they were sick in 2010  45,000 too few PCPs by 2020

35  Patient Centered Medical Home  New accountability  New IT  “Enhanced Access”  Expand office hours and accept more unscheduled patients vs. partnering for episodic UC visits.

36  Avg. cost of an UC visit is slightly BELOW the average primary care visit ($155 vs. $165)  Difference in cost between an UC and ED visit for the SAME DIAGNOSIS ($228-$583).  116.8M ED visits per year x 27.1% (est. 8-57% non-emergent)= 31.64M visits= cost savings $7.22B-$18.45B per annum.  Does NOT include 30M newly insured with no place to go. (Suggests room for additional centers in areas already served)

37  Fevers  URIs  Sprains/Strains  Lacerations  Contusions  Back pain  Most can treat fractures and give IV fluids  Most have x-ray and lab processing onsite

38  NOT freestanding EDs- Not equipped for life threatening conditions.  NOT in-store retail clinics (broader scope of services and ages, primarily physician or physician/MLP staffed vs. MLPs alone).  Many offer scheduled primary care visits and/or physical therapy.  New Options Emerging

39  Franchise Fee $55,000  Royalty Fee 6% of gross sales  Initial Investment $526K-$715K (inc. FF)  Net worth $750K, Liquid Investments $350K  Multi-unit discounts available.  Term- 15 years with 4 optional 5 year renewal terms.  Advertising fees $1000/month spent in local market plus unspecified “ad fund” contributions when “deemed appropriate”.

40  Founded 2005 by an EM physician  Board Eligible/Board Certified physicians- no MLPs, no residents  In-House pharmacy  Lab and X-ray on-site  Occupational Medicine  Billing Services via “specialized approved” vendor  Software System- Intake, scheduling, integrated payroll/benefit etc.

41  No direct financing available.  No prior industry experience required  Training- 5 days at corporate headquarters (you pay travel/lodging) plus on-site training around opening, on-line learning modules, webinars etc.  Support- Operations manual, periodic on-site visits, , phone, on-line support services website, hiring

42  Assistance with licensing and credentialing  Advertising materials  Site selection  Center design

43  All Board Certified Emergency Physicians  Offers Lab, CT, Ultrasound  Accept Chest Pain, Abdominal Pain but no ambulances  Open 8A-10P  Online check-in  Urgent Care co-pays 

44  Pro- We know the medicine  Pro- Growing Market  Pro- No overnight shifts/limited day shifts  Pro- Modest volume (30 patients/day) is profitable  Con- Significant start-up costs  Con- Unpredictable future reimbursement  Con- Focus is on building the business, not seeing patients.  Con- Structured model (Often difficult for physicians)

45  Questions?


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