Today was, in my perspective, one of the most valuable CP classes of the year. I really wish we had more opportunities to learn about the business aspect of chiropractic, as this will become a huge component of our career when we leave CMCC.
Here are some glossary terms that accompanied the session:
Cash Equity Contribution – money invested in your practice that represents an ownership interest.
Cash receipts – cash you receive from patients after you’ve provided a treatment or sold a product.
Collateral or security – assets pledged to support a loan (i.e. money, house, equipment).
Cost of goods/services sold – direct costs incurred in delivering your product or service (i.e. pillows, supplements, orthotic supplies etc.).
Current assets – cash, accounts receivable, inventory and other assets that are due within one year.
Current liabilities – payables, bank loans and other debts payable within one year.
Depreciation – the amount by which the cost of an asset is written off, over its estimated useful life.
Disbursements – money paid out to run your practice – the opposite of revenue.
General and administrative expenses – the common expenses of doing business (i.e. chiropractic supplies, paper, marketing, rent, insurance etc.).
Goodwill – an intangible asset reflecting the excess paid for your practice over its net asset value (i.e. the value of your patient files, location etc.).
Gross profit margin – the difference between revenue and the cost of goods or services sold.
Interest expense – the cost of servicing your debt with lenders such as leasing companies, and banks.
Operating loan – a type of bank loan that should be used for day-to-day operating expenses. (This is also known as a line of credit.)
Operating profit – profit before your draw, dividends and income tax.
Payables – also known as accounts payable – money owed by the practice to suppliers.
Receivables – also known as accounts receivables – money owed to the practice by patients and third-party payers.
Retained earnings – accumulated profits retained in your practice and not paid out as dividends. This is more applicable to practices that are incorporated.
Shareholder’s equity – the net assets belonging to the owner of the practice. It is the difference between the practice’s total assets and total liabilities.
Term loan – a type of bank loan that is for a specified amount and period of time, often used to finance the purchase of practice, equipment and leasehold improvements.
Accounting: the action or process of keeping financial accounts
Financing: Provide funding for something. Managing large amounts of money
Income statement: financial statement that measures a company’s financial performance over a specific accounting period. Assessment summary of how the business incurs revenue and expenses through both operating and non-operating activities.
Balance sheet: Statement of assets, liabilities and capital of a business or other organization at a particular point in time, detaling the balance of income and expenditure over the preceding period.
Marketing: The action or business of promoting and selling products or services, including market research and advertising.
Budget: An estimate of income and expenditure for a set period of time
Entrepreneurship: One who organizes, manages, and assues the risk of a business or enterprise.
Human resources: The personnel of a business or organization, especially when regarded as a significant asset. Department that deals with hiring administration and training personal.
Strategic management: involves the formulation and implementation of major goals and initiatives taken by a company’s top management on behalf of owners, based on consideration of resources and an assessment of internal and external environments in which the organization competes.
Operations management: refers to the administration of business practices to create the highest level of efficiency possible within an organization. It is concerned with converting materials and labor into goods and services as efficiently as possible to maximize profit of an organization.
Systems management: refer to enterprise-wide administration of distribution systems including computer systems. This is strongly influenced by network management initiatives in telecommunication.
Long list..... I know, but I actually enjoyed learning about it all! Along with this, we explored the different types of career styles we may have one day. Regarding these, we discussed the pros and cons to each, which are listed in the above artifact. I still have a lot of self learning and academic learning to do before I am fully able to make an informed decision about the style of practice I wish to manifest.
Cheers to more learning!