Franchising: Hearing Care's New Frontier

The franchise model has allowed many small business owners to succeed, some beyond expectation. This success, though typically associated with fast-food restaurants, spans industries, geography, even locations and schedule. Throughout it all, a common thread demonstrates the greatest benefit of the franchise model: a set system of operations, branding and marketing that provides the owner with the necessary support for success.

Several factors have contributed to the increasing difficulty of running a hearing care private practice: higher facility costs, limited marketing knowledge, smaller personal budgets and more complicated billing strategies. There are also some common hurdles faced by private practice owners: local competition, ensuring a high quality of staff and internal time and effort for marketing.

Today's hearing care landscape combines the power of the health maintenance organization (HMO) with the economic challenges presented by a recession, along with the increasing power of social media and brand awareness. While no perfect solution exists, the franchise model may represent the happy medium for audiologists seeking a balance between private practice autonomy and HMO-level stability.

How does it all come together? Perhaps it is time for the hearing care industry to take a cue from a company often considered the antithesis of health and medicine: McDonald's.

More than Just a Happy Meal

What do you think when you hear "McDonald's?" The name itself probably brings many thoughts to mind - fries, Big Macs, golden arches, even your nearest location down the street or the one right off the highway by the office. All of those sights, sounds, tastes and smells came from just one word, thanks to the power of effective franchise branding. Taking a step beyond that, think about the last McDonald's commercial you saw on TV. There is a good chance you associated that with your nearest location, despite the fact that that location's manager had nothing to do with buying the network commercial time. As a franchise, a national corporate marketing campaign simply trickled down to the local level.

Of course, it is not just about marketing or brand awareness. Consistency is one of the traits of a successful franchise. When you walk into McDonald's, you know what is on the menu, you know roughly what you are going to get in terms of quantity and quality, you know how long you are going to wait, and you know about how much you are going to spend. You probably even know where the nearest two or three locations are. Each McDonald's franchise is based on the same operational model, and while each restaurant's individual performance depends on the quality of the actual staff, the foundation exists to replicate success over and over. The systems are proven; they work as long as the effort is properly applied.

Operations, branding and marketing are three key elements to a successful business. As a part of your daily diet, McDonald's is certainly not ideal. However, as a franchise business model, McDonald's is the ultimate example. The employees focus on service, not marketing or business, while franchise owners benefit from corporate support and brand visibility. It is consistent from top to bottom, and that is where the audiologists can learn a lesson when exploring the tangible benefits of franchising.

Seeking a Middle Ground

Today's audiologists tend to be split between working for a large hospital or organization (such as Sutter Health or Kaiser Permanente) or a private practice. Audiologists that work for the former can focus on their patients and customers, but they are limited by structure when taking control of their career. Private practices provide autonomy, but go hand-in-hand with an overwhelming amount of responsibilities to keep the business side of things up and running.

The happy medium is the McDonald's model - franchise structure, assets and support to provide corporate support for private practices.

The idea of a franchise model for the hearing-care industry is by no means new or groundbreaking, but it is certainly underdeveloped. Think about it this way. Ask any audiologist about their education and background and you are bound to hear details regarding research and training, but you likely will not get any speeches on business milestones, brand awareness or marketing strategy. The reason for that is simple: audiologists focus on their immediate specialties, not running a business. Utilizing the franchise model for health care, many of the business gaps vanish.

Operations: From information technology (IT) systems to appointments, the franchise model ensures the most up-to-date and consistent operational support to keep a business running efficiently. If the home office wants to keep things as smooth across the board as possible, that means a good corporate office must be prepared to handle questions, fixes and other support issues. In the medical billing arena, good systems are imperative. Changing hearing-care practices can be a costly undertaking. When utilizing a trusted partner, this expense and headache can be relieved.

Branding: Reputation goes a long way in the medical industry. How many times have you asked a friend or family member for a doctor recommendation? By having an established brand, franchise owners get an immediate return in terms of recognition. The general public may not know who Dr. Thompson is or her audiology background, but the power of a franchised hearing-care brand instantly communicates details such as services offered, specialties and longevity.

Marketing: Marketing opportunities work hand-in-hand with franchise branding. The entry point for new customers is instant due to the brand's reputation. Beyond that, franchises benefit from corporate-wide marketing strategies and materials. Of course, audiologists are always welcome to initiate local marketing such as free clinics or seminars, but they can feel confident that they will always be supported on a corporate level.

When compared side-by-side to private practice and hospitals, it becomes clear how franchises take the best of both worlds. Let's take a closer look at each of these areas from the perspective of an audiologist working for a hospital, private practice or as a franchise.

A Closer Look: Operations

According to the National Institute on Deafness and other Communication Disorders (NIDCD), nearly 28 million Americans suffer from hearing loss (1996), and that means that there is always someone waiting for proper hearing care. However, in order to provide those services, a business still has to require all of the details incorporated with a strong business: operations, systems, billing, et cetera. Each office's efficiency, however, often depends on your level of support, and when it comes to support, bigger is usually better. Hospitals and private practices offer a wide chasm in terms of operations, with the franchise model fitting neatly in between.

Hospital: As a staff audiologist at a hospital, your business operations are taken care of for you by the administrative staff. Appointments, billing, bookkeeping, and all of the other logistics of business are simply part of a bigger system. Hospital audiologists are allowed to focus on their patients without worrying about the how or why of a successful business. The flip side to this, though, is that the hospital will do whatever it takes to ensure appointments and referrals keep coming in. Thus, the pace of appointments can seem like a revolving door to both the doctor and the patient.

Private Practice: As an audiologist who also happens to be a business owner, literally everything starts and ends with you. The beauty of this is true autonomy and the chance to build something special from the ground up. However, there is nothing easy about creating an effective business model from scratch. Computer systems, billing systems, appointment systems, even staff scheduling are all controlled internally. A private practice can have the world's most reliable staff and strongest operations manager, but smart owners understand that they maintain a responsibility to stay involved with the business side of a private practice, despite the burden of additional time and effort.

Franchise: The franchise model is where the autonomy of private practice can meet the practical benefits of hospital employment. Franchises come with proven systems in place. With the aforementioned McDonald's model, that includes menus, ordering systems and recipes. For the hearing-care industry, that means that appointment/billing systems, computer network infrastructure and other key everyday logistics are already in place. Like a hospital, these things come with support and a track record for success. Like private practice, the owner ultimately has the final say on how to utilize these systems and tools. In short, the franchise model gives the owner many resources similar to hospital employment, but with the flexibility and control of private practice.

A Closer Look: Marketing

Marketing is the lifeblood of business. Without it, customers do not come in and revenues falter. However, marketing is something many audiologists dread. No one received their Au.D. to focus on the marketing side of a business. From this perspective, the hospital element is almost non-existent, but private practice and the franchise model share many similarities, along with some key differences.

Hospital: As a hospital audiologist, marketing simply is not your concern. There may be a mandate to mention new initiatives or programs during appointments, but things like ad campaigns and Web site traffic belong to another department, not the hearing care staff.

Private Practice: Marketing for private practice is the same as marketing for small-business owners. It is a game of trial and error, money spent and money earned. From Web sites to pay-per-click campaigns, from local coupons to newspaper ads, from community initiatives to free promotional clinics, it is an all-encompassing journey that requires a significant amount of time for any business owner. Of course, the audiologist could always hire a consultant, but the final say belongs with the person signing the checks. For the ready, willing and able, this can be a unique process that is equally educational and rewarding; for those that dread it or do not understand the right approach to a target market, the experience can land somewhere between disheartening and disastrous. Regardless of the outcome, though, one thing is certain: marketing requires a lot of effort.

Franchise: Franchise owners are small-business owners just like private practice owners. The difference, however, is that franchise owners receive support from the corporate side - strategy, materials, signage, return on investment and more. Corporate nationwide marketing also trickles down to the local level through promotions and name recognition. So while it is up to the franchising audiologist to execute a marketing strategy, the nuts and bolts of the campaign come from an experienced staff at the corporate headquarters. Outside of corporate-produced marketing materials and campaigns, the franchising audiologist can utilize whatever strategy to engage the local market and ultimately find the right balance between corporate marketing and self-developed marketing.

A Closer Look: Branding

Brand awareness is something that all businesses strive for. Even for sole proprietors or freelancers, brand awareness means just as much as it does to a large corporation. It is the ability to have your brand be associated with success and trust, be it your name or logo. That is why companies spend millions each year researching logos, taglines, and other ways to establish and build the brand. For audiologists, the branding process is just as critical. It can create instant trust among patients and customers. The way in which this is achieved can come about in different ways.

Hospital: For audiologists at a hospital, branding is a double-edged sword. The hospital's reputation, for better or worse, is integrated into the audiologist's identity. For example, a good audiologist at a hospital known for poor service will be "the doctor who is good despite working at the bad hospital." In a best-case scenario, a good audiologist works for a good hospital and both contribute to the brand's strength. At the very least, the audiologist should understand that the hospital's marketing staff controls the branding, so other than focusing on his or her own situation, there is simply not that much to do.

Private Practice: The signage at private practices often states only the audiologist's name and specialty. Brand awareness is achieved through time, patience, and networking. It is a grass-roots process. The issue, then, becomes whether or not the audiologist (or the trusted staff) have the time and energy to do the extra things that establish and grow the brand. Without that added effort, the practice becomes just another name in an office window. There are no distinguishing qualities or reputation to pull in new patients.

Franchise: Using the franchise model, the branding effort walks the line between hospital doctors and private practices. Like a hospital, a franchise name comes with a reputation. Like a private practice, the franchise is an individual business, capable of establishing brand identity through marketing and networking efforts. The franchise owner's branding has a built-in foundation attributable to the long reach of the parent company. This immediately creates an identity for new customers when they recognize branding assets. On a local level, the individual franchise can use the same grass-roots methodology to become something bigger than just the franchise brand in the community.

Success Across the Board

Franchises tend to be associated with fast food, and for good reason. They are the most widely-visible examples of the franchise model. However, franchises exist in all shapes and sizes across a wide range of industries. While franchising is still relatively new to hearing care, the industry can look at the following two health/wellness franchise examples as effective growth models.

Example 1: Pearle Vision - With over 300 Pearle Vision eye-care franchises across the United States (Entrepreneur, 2012) it is safe to say that the Pearle Vision brand has a national footprint. The parent company claims 95% national brand recognition (Pearle Vision, 2012), which makes a big difference for any doctor trying to establish a customer base. In fact, the Pearle Vision model is an ideal comparison for the hearing-care industry, from start up to marketing to operations. Pearle Vision provides systems for day-to-day operations, instant brand equity and in-depth training that reaches across marketing and logistics.

For marketing, Pearle Vision offers both national and local support across all critical advertising avenues: print, television, radio, and online, along with corporate support that focuses on possible new channels. Pearle Vision also provides franchises with in-depth business analysis designed to help local markets maximize potential. In short, Pearle Vision offers end-to-end support across all avenues so optometrists can focus on what they do best. That idea is something that probably hits home with any audiologist considering private practice options.

Example 2: Massage Envy - Massage Envy has not been around nearly as long as Pearle Vision, but the company has established itself as a leader in the wellness industry. As a franchisor of professional massage therapy studios, Massage Envy locations have many of the same requirements as an individual hearing-care practice: front reception, waiting area and appointment spaces. Massage Envy provides franchises with both start-up (location and staffing, systems, signage, displays) and ongoing support (training, marketing, procedures). The day-to-day process of receiving appointments, seeing clients and bookkeeping/billing/follow-up mirror the needs of hearing care, and Massage Envy demonstrates how both the start-up process and general operations can be streamlined with the franchise model.

Is Franchising in Hearing Care's Future?

While many businesses are having their market share usurped by online stores, there is simply no replacing the face-to-face nature of hearing care. Unfortunately, the logistics of establishing a brick-and-mortar business are more difficult than ever before. While location lease rates vary based on the ups-and-downs of individual markets in today's recession economy, some things are universal: patients have less to spend, utility costs are up and operational expenses for most businesses are up.

Because of those factors, the top priority for any hearing care practice is a bottom line as strong as the quality of care provided. While individual practice does not provide the security of a salaried hospital position, it offers a level of career control that can be very appealing. For those willing to take that leap, the audiology franchise model represents a best-of-all-worlds solution, a path to streamline branding, marketing and operations.

If you take those factors out of the equation, what does that leave you with? For a fast-food franchise like McDonald's, it drills down to the employees trying to fulfill orders as quickly as possible. But over in the hearing-care sector, it allows audiologists and staff to do what they do best: treat patients and customers on a personal level while feeling confident in the safety net of corporate-level support.

Franchising is the middle ground that can potentially revolutionize the hearing-care industry, just as it did for eye care with Pearle Vision and massage therapy with Massage Envy. Today's economy presents many challenges to all brick-and-mortar sectors, but if the hearing care industry as a whole is willing to take a good, hard look at the benefits of franchising, many eyes may be opened to a whole new world of potential. Franchising represents a path to successful hearing care entrepreneurship, and the industry is just on the cusp of it.

References

Entrepreneur. (2012). Pearle vision. Retrieved May 1, 2012, from www.entrepreneur.com/franchises/pearlevision/282671-0.html

National Institute on Deafness and Other Communication Disorders. (1996). National Strategic Research Plan: Hearing and Hearing Impairment. Bethesda, MD.

Pearle Vision. (2012). Franchise opportunities. Retrieved May 1, 2012, from www.pearlevision.com/about-pearle/franchise-opportunities.action