Medical Spa MD: Physician community of skin clinics, laser centers, plastic surgeons, dermatologists and aesthetic doctors practicing nonsurgical cosmetic medicine.
New Face for the giving.A 2005 survey by the American Academy of Facial Plastic and Reconstructive Surgery found that 40 percent of cosmetic surgeons had a patient who received a surgical procedure as a gift. Women typically receive the gift from their husbands or mothers, doctors said.
As acknowledged by the American Board of Cosmetic Surgery and affirmed by the Superior Court of California, cosmetic surgeons include qualified physicians from the fields of Dermatololgy, Facial Plastic-ENT surgery, Oculoplastic surgery, General Plastic Surgery, Oral Maxillo-Facial Surgery, and General Surgery.
Via: Plasticized
The Academy has reported, via e-mail and through Newsline, the recent victory in California for cosmetic surgeons, whereby the Superior Court of California ordered the Medical Board of California to grant ABCS's Application for specialty board certification. This decision was recently challenged by the Medical Board, which filed a Motion for a New Trial.
...The ABCS allows for cosmetic surgeons, including ENT's, Oculoplastic surgeons, and cosmetic dermatologists to have certification for the specialized skills in which they are trained. Certification through ABCS is often acheived through fellowship training in cosmetic surgery, which occurs after a residency in a surgical specialty.
and Edward Lack MD isn't mincing words when he says..
"I would hope this will end the dispute once and for all and stop the needless waste of money and time over what is only a turf battle. As the number of board certified plastic surgeons who join the American Academy of Cosmetic Surgery and take board exams from the American Board of Cosmetic Surgery increases, the obstructionists who often hide their identities in the American Society of Plastic Surgery will lose more and more prestige as the public views them as the self-seeking propagandists that they are."
I thought this graphic was a curious when I first saw it but these guys are serious. Patients Unlimited is a training company where you send your staff so that they know what to say to your patients. The PUMC Motto is: “An investment in your staff benefits your practice”
For $395 Patients Unlimited will teach you how to:
Yowser! I'll be stopping shoppers in their tracks? Where do I sign up.
To be honest, I've never heard about Patients Unlimited before but I have seen better execution of training programs and higher standards of advertising. If they seem good to you, great, at least they're cheap.
They do post a few items that cause me to furrow my brow. In the graphic above I notice that they show that the source of 31% of consultations is the yellow pages.
Ahem... no.
If you're relying on the yellow pages to drive a third of your patient flow you're getting run over. In my own opinion, yellow pages aren't worth the money. But what do I know?
I have definitely seen an increase in the number of people coming into my office for mole checks and skin exams this week. Some directly mention Laura Bush. "Well, I just thought I should get it looked at, with Laura Bush and all, you never know." She certainly did pass on an opportunity to encourage screening and prevention of skin cancer.
The New York Times does note the service Laura performed on behalf of breast cancer awareness when she too was diagnosed:
Mrs. Bush has advocated the public discussion of cancer. Speaking in St. Louis in October for Breast Cancer Awareness Month, she lamented how decades ago, "because everyone kept breast cancer a secret, women didn't have regular mammograms or perform breast self-exams, because no one told them to."
Kevin MD posts a link to how a practice cannot live on Medicare patients alone:
Total reimbursement for 292 patients was $516,158—mostly from surgical fees of $407,063. The cost to run the practice was calculated at $444,592 a year: $207,065 for salaries, $55,150 for malpractice insurance and $182,377 for other expenses. All the figures were based on costs from Dr. Madan’s practice.
After expenses were paid, the surgeon’s pretax earnings totaled $71,566.
But as Elliot notes in a comment on Kevin MDs blog:
He was not paid 71k for 300 bariatric surgeries. He's a lousy businessman is the story. Medicare reimburses more than 10k per bypass so he generated some 3,000,000 in revenue for someone. I am certain he got North of 500k for his part so where did all the money go? Lousy businessman should give up his dream of becoming rich by running his own practice and go to work for someone else.
Something here just doesn't make sense... $207 for salaries and amost another $200k for other expenses?
...The physician, who is described as clinical instructor in plastic surgery at a renowned west coast medical school where he is also an attending physician in plastic surgery says, according to the publicist’s email, that “there are cases…where the right procedure can turn a child around from being depressed to self-confident.”
Riiiight. A little surgical intervention will correct all those unruly, adolescent growing pains. And in case the surgery doesn’t lift her depression, why not drop some Paxil in her morning orange juice and give her a list of pro-ana websites to help keep her weight down...
...Might this doctor’s “acceptable motivation” in promoting teen and tween cosmetic surgery be a new Mercedes Benz? As the baby boomers age into elderhood in the next few years, it won’t be cosmetic surgeons they need and we can’t afford to lose more doctors to this unneeded specialty.
these are precisely the kind of pronouncements you would see under socialized medicine. Corrective eye surgery? "Unneeded" — just wear glasses! Orthodontics? "Unneeded" — that's cosmetic! Paxil? "Unneeded" — use talk therapy instead! Birth control? "Unneeded" — use condoms! Expensive end-of-life "extraordinary efforts"? You know the answer.
Yet another article on medical spas in malls.
If you believe all the articles talking about the growth of medical spas and cosmetic practices... don't.
Medspas are medical practices like others. Some win and some will loose and go out of business. (Read Ron Berglund's series on his Sona medical spa franchise.)
If you took all these articles at face value you'd think that everyone but you is making money hand over fist. You'd be wrong. Retail medicine is a business. Those that are good at it succeed. Those that are not go out of business and sell their IPL's on Ebay.
Read the Medical Spa MD series: Inside a medical spa franchise.
By RHONDA L. RUNDLE...Medspa ownership turnover generally reflects business stumbles rather than safety issues. Ms. Leavy says many of the troubled spas are affiliated with franchise chains with flawed business models, such as those requiring too much of a franchisee's revenue to go for marketing. (She estimates that about 10% of medspas are franchises, although other industry experts put the percentage at 30% or higher.)Several Sona franchisees, though not Mr. Nebot, are in private arbitration over problems that include misrepresenting a complicated business as a turnkey operation and failing to provide needed support. Sona officials declined to comment.
Several franchisees of Radiance MedSpa Franchise Group PLLC, a franchiser in Scottsdale, Ariz., say the company's financial projections overestimated revenue and underestimated initial start-up costs, including working capital.
The president of Radiance, Charles L. Engelmann, recently said: "There are currently 32 open stores and we will have 47 or 49 open by the end of the year. None of the stores have closed." He also acknowledged that some franchisees are attempting to get their money back.
One common pitfall for medspa operators is the failure to properly account for prepaid services, such as discounted packages of laser or light-based facial treatments. At Mr. Nebot's shop, for instance, clients would routinely pay $1,000 in advance for a package of laser hair-removal treatments to be delivered over a year or more. The shop's rooms were then filled with nurses treating customers who had paid months earlier. Finding new customers with fresh cash was a constant struggle.
Mr. Nebot says he felt like a cartoon character, "running faster all the time but falling further behind." He used radio advertising to draw more clients, moved to a larger space and extended his operating hours. To avoid alienating customers, he gave away free treatments to those who complained that their hair kept growing back after they finished the five-treatment regimen they purchased.
In the wake of the recent legal changes in Florida, some medical-spa owners there must shell out an extra $60,000 a year or so to a dermatologist or plastic surgeon to oversee operations.
"I can't be my own medical director any more, which is an added expense I can't afford," says one Florida physician who is not a dermatologist. He says he is "facing personal bankruptcy and trying my best to get out while there is something left for my family" after miscalculating what it would take to market, advertise and build his business. Indeed, many medspa owners are doctors who hope to make easy cash at a time when income is shrinking from their traditional medical practices.
Some franchisers have run afoul of state regulators by violating laws against the corporate practice of medicine. In February 2005, California denied a franchise application from HealthWest Inc., a Los Angeles firm that had more than a score of Inaara MedSpas around the country. California ruled that HealthWest had "falsely represented" to owners that they could legally own a medspa without a medical background. HealthWest has gone out of business, but some Inaara shops broke away from the founders and still are operating as independent, stand-alone shops. (Note: The former owners of HeathWest are now 'licensing' medspas under the name Solana.)
Another bust was Skin Nuvo International LLC, which filed for bankruptcy and sold its 37 stores to a private equity firm that in turn sold them to Pure MedSpa, a Toronto company.
Sleek MedSpa, a closely held chain in Boca Raton, Fla., recently acquired SkinKlinic's Fifth Avenue flagship in Manhattan, but SkinKlinic's two other stores, one in Las Vegas and the other in Greenwich, Conn., have closed. SkinKlinic's founder, Kathy Dwyer, is a former senior executive of cosmetics giant Revlon Inc. Attempts to reach her for comment were unsuccessful...
Too many options create unsatisfied patients.While the comments below were made regarding web site development, they are equally applicable to any offering. Novice businesses often want to include the 'we do it all' statements in their advertising and consultations, in effect, putting the decision making problems back in the lap of the patient.
The patient wants and needs to feel secure in their decision. Creating a menu of too many choices creates a petrie dish of patient dissatisfaction.
From the patients point of view, too many choices puts them at risk of choosing something other that the optimal. While you may not want to extend yourself to 'telling a patient what to choose', that's exactly what the patient wants you to do. Great salesmen know this and often employ a 'shark fin' approach by narrowing the offering to three choices; an exceptionally expensive choice, a minimal baseline choice, and the one they're really selling, the 'as good as premium but without the bells and whistles choice'.
The patient wants to be sold. That does not mean the the patient wants to be pressured, it means that they want you to lay out their options, risks, and rewards, and make a recommendation in their best interest.
Luke Wroblewski - The Paradox of Choice:
When people have no choice, life is miserable. As you start adding options, you increase wellbeing. However, you reach a point where the curve flattens out and there are diminishing marginal effects. At a point in the curve, satisfaction drops and you are worse off than when you were neutral.
Are all these choices a good thing? Yes. Having choices is good but we have always thought it was only good. There is a dark side as well:
- Paralysis: so many options that you end up not making a choice. A grocery store alternated allowing customers to sample 24 different flavors of jam & 6 different flavors of jam. With 24, more people came to the table but 1/10th as many people bought jam. In Speed dating, you are more likely to select a match with 6 dates vs. 10. For every 10 mutual funds made available, rate of participation in 401(k) investing goes down 2%
- Decision Quality: when presented with too many options, we do not use difficult criteria to decide but choose on the basis of what is most simple. For 401(k)’s the simplest choice is the worst choice: putting money in a money market account. In retail brand and price are the simplest choices.
- Decision Satisfaction: Even when people have chosen well, they are dissatisfied with their results. When you give people lots of options, they will get a better result. But they will feel worse due to regret and anticipated regret. If you did not examine ALL options, you assume one or more might have been better. This reflects opportunity costs: the reduction of value through comparison to other options.
- Escalation of expectations: the availability of many choices increases expectations. When things were worse (less choices): it was easier to exceed expectations (now as high as possible). There are no pleasant surprises left.
- Maximizer Impact: too many choices is an issue for people whose aim in life is to get the best (maximizers). How do you know if you got the best? You actually need to look at every possibility by making an exhaustive search. There is virtually no area where maximizing makes sense.
- Leakage: the conditions present when people are making a choice do not stop exerting influence after a choice has been made. People are less satisfied due to regret or missed opportunities and this dissatisfaction extends after the choice to the actual experience.
Via Skin & Aging: Dermatology vs. DermatologistThe Importance of Specialists
However, there cannot be any misrepresentation on the part of the physician. Every patient should be given an option of seeing a specialist who really is a specialty-trained, board-certified physician. It is not okay, in my opinion, for any physician to call him/herself a “dermatologist” simply because he or she has an interest in the field, especially when this claim has purely financial motivation.
Dr. Goldenberg, Section Editor of Issues in Dermatology, is a Dermatopathology Fellow at the University of Colorado Health Sciences Center, Department of Pathology, in Denver, CO.
Vs: Seeing the Good Side of our Colleagues
I have tremendous confidence in the skills of my dermatologist colleagues. I regularly see their commitment to their patients and our specialty. Like Dr. Goldenberg, I think it means something to be a “dermatologist” and believe it is wrong for a doctor to try to mislead patients.
I wonder, though, if Dr. Goldenberg goes too far in impugning the motivation of medical colleagues in other disciplines. Is there evidence that “many physicians, foreign and U.S. medical graduates alike, claim to be ‘dermatologists’ even though they have no training in the field whatsoever”? Unless there’s good evidence to the contrary, I think it is wrong to suggest that other physicians’ acts are based on “purely financial motivation”; we all have financial motivations, but it seems to me that physicians are largely driven by a desire to improve the lives of their patients.
There is a strong tendency to see our colleagues’ mistakes and never see their successes. Such experiences seem to bolster the all-too-human tendency to think the worst of others. We’ll all agree it is wrong to mislead patients about one’s training and experience. It may also be wrong to believe the worst of colleagues and to assume a priori that they are acting outside of their capabilities and training.
Dr. Feldman, Chief Medical Editor, is in the Department of Dermatology at Wake Forest University Baptist Medical Center in Winston-Salem, NC.
These days, the soft-spoken, but formidable family physician is mixing it up in the role of healthcare reformer. Three years ago, Wood began advertising that his clinic would provide unlimited primary and urgent care for a monthly fee of $83 for an individual, $125 for a family. Wood immediately ran afoul of the state insurance commissioner, who warned him that he was operating as an illegal insurer, a felony punishable by up to five years in prison. For the next three years, Wood pushed for legislation—and got pushed back by the insurance-industry lobby—that would legalize his experiment. Now instead of prosecuting Wood, West Virginia is replicating his bargain-basement version of concierge medicine in a pilot program. The goal—to make healthcare more affordable in one of the poorest states in the nation.
These posts are written by former Sona Medspa owner Ron Berglund to provide an inside view of the way medical spa franchises recruit, train, and support their owners as well as detailing some of the problems with medspa franchises.
Read Part 1: Why I bought a Sona Franchise. Part 2: Sona Promises
Sona and its officers made numerous representations to prospective franchisees such as my partner and I regarding Sona’s “magic formula” for success. They had to promise a great deal to justify the astronomical price they were charging for admission. Their representations were supplemented by written materials, sales materials, and information provided on their web site and other franchise web sites such as Bison.com.
Sona claimed that it had developed a “proven business model” for removal of unwanted hair through laser technology that could be utilized by franchisees with no prior experience in the field and with great success, because it had the “fastest, most powerful laser technology and offered services at much lower fees than competitors.” My three year hitch with Sona, and the failures of numerous other Sona franchisees, certainly makes this representation look absurd. The only thing “proven” about their business model is that it is proven to drive many followers to bankruptcy. I will go into the “fastest, most powerful laser” statement later in the story.
Sona’s claim to have a patent-pending “revolutionary” concept, that removed 93 to 97 percent of hair in all areas permanently in five treatments also proved to be totally bogus. Dennis Jones specifically said that Sona would offer clients a sixth treatment at no cost if the first five had not removed all hair, but that this was “extremely rare.” Sona also said that this “patent-pending process” resulted in hair removal in “less time with better results” and that ensured that franchisees had “a compelling competitive advantage.” These misrepresentations proved to be an “economic death sentence” for many of us. Our entire business model was premised on the understanding that the treatment packages we sold would be completed- and our clients satisfied- after the five pre-paid treatments were performed. Unfortunately for those of us holding the bag—and whose “necks were on the line”—the overwhelming majority of our clients required significantly more than five treatments to achieve anything even close to 90% hair removal. After over promising thousands of clients during the first 18 months of operation, we found there way no way to get out of the corner we had painted ourselves into.
Sona stated that it was safe to use Sona’s laser hair removal processes two weeks after sun (or tanning bed) exposure sufficient to tan the skin. Furthermore, they told us that after treatments our clients could immediately return to tanning. Both of these statements proved to be totally false. Tanning proved to be an incredibly dicey aspect of the laser hair removal process, and added an additional wild card to our safety and efficacy problems.
Sona claimed that it had other proprietary technologies that gave it a major competitive advantage, including a topical anesthetic called “Sonacaine” that minimized any discomfort resulting from the laser treatments. As we quickly discovered, there was absolutely nothing proprietary about their 4% lidocaine topical product.
Sona further claimed that whereas our laser hair removal competitors would be unable to successfully treat blonde, red or gray hair, we would have an “exclusive license” for a product called “Meladine” (produced- coincidentally- by another company owned by Dennis Jones). According to Sona, their magical “Meladine”, which they claimed was proven to be effective in clinical studies, would make light colored hair follicles “visible” to lasers. The use of Meladine in our clinics would therefore “enable all hair colors to be treated”, would make our Sona Laser Center far more competitive than other laser treatment venues, and would increase our revenues substantially.” Not surprisingly, those of us who incorporated the use of Meladine in our operations found that it not only did not work as claimed, but that it also set us up for having to give thousands of dollars in refunds to unhappy clients. My experience was that the success rate of Meladine was almost nil. I cannot even imagine how much this fiasco cost us in terms of creating unhappy clients who would do nothing but spread negative goodwill about our business.
Sona claimed that its operations typically resulted in a 55 percent gross profit margin or more. They further claimed that we could expect to achieve “break-even” with gross revenues between $44,000 to $50,000 per month. Sona’s franchise offering circular showed pro formas reflecting financial results at assumed revenue levels ranging from $50,000 per month to $125,000 per month and earnings ranging from $288 to $36,240 per month. The same offering circular stated that average monthly gross revenues were over $65,000. At this level, it was stated that earnings would be $6,768 per month. Sona’s officers privately whispered to many of the franchisees that they could easily expect to receive an actual profit of 20% of gross revenues each month. Unfortunately, in the real world I don’t think any of the Sona franchisees made any true “profit” at all when the ramifications of selling prepaid packages for cash upfront played out. The entire financial projection furnished by Sona proved to be misleading, unsubstantiated and blatantly deceitful. One needs to simply look at the track record of the pioneer affiliates and franchisees who have been falling like dominoes during the past two years to substantiate this conclusion.
Sona claimed that their company-owned laser centers in Virginia were profitable. Sona never furnished profit and loss statements from their corporate-owned centers, but I would wager my first born child that an analysis of their financial statements- or the statements of any Sona center in the entire U.S.- would establish that nobody was actually making a profit.
Sona stated that it surveyed, reviewed and tested all lasers on the market, and had selected only the best, state-of-the-art lasers, manufactured by Cynosure, for use by franchisees. Moreover, Sona’s program provided “continuous maintenance and replacements to keep each center a step ahead of the competition.” Mindful of the very competitive and fast-paced landscape of the medical laser industry, I was very hesitant to handcuff myself to dealing with a single laser manufacturer. At the time, I had heard very little about the Cynosure company, and I would have much preferred to be able to negotiate with any of the dozen or more leading providers of equipment suitable for laser hair removal. The one advantage I did see, however, was that we would not have to purchase (or lease) our lasers as Sona’s franchise agreement incorporated a revenue share agreement for the lasers. Hindsight is always 20/20, and in hindsight I discovered a number of things that made even this aspect of the Sona program a disaster. First, a number of us later discovered in litigation that Sona did not “survey, test and select” the Cynosure lasers at all. In fact, Cynosure was a 40% owner of the Sona corporation. This meant that we had no ability to negotiate freely with other laser companies, and we were essentially a “captive audience” of Cynosure. Second, as will be detailed later, the Apogee 9300 lasers furnished by Cynosure were horrible.
Sona stated that it had “television, radio and print media materials … unsurpassed in the industry” that were worth “hundreds of thousands of dollars”. Sona promised that these materials would be made available to franchisees, not only for the grand opening, but also for “the ongoing success of the center.” Sona further promised to provide hundreds of thousands of dollars in new additional advertising each year as part of the base franchise fee it charged us. Sona also stated that it had a “corporate marketing director” and “marketing staff.” A grand opening event would be planned and executed by Sona that would include press releases, media packages, radio and television appearances, and an “all out media blitz.” Not surprisingly, Sona’s entire marketing program was pathetic, and most of us essentially took on the entire responsibility for advertising and marketing on our own.
Sona further claimed that it provided world-class, state-of-the-art training “that goes far beyond standard industry practices”. Sona stated that even franchisees who had no prior experience with the market would be fully trained and able to run their businesses successfully. “There is no more in-depth training to be found,” Sona claimed. After operating the center for several months, we found that Sona’s “world class” training was so bad that it actually proved to be a negative. Among other things, the clinical training provided to our nurses and Sona’s treatment protocol recommendations were so ultra-conservative that – in the typical case—we later found that most clients were not being treated at an efficacious energy fluence until their fourth or fifth treatment. Many of the clients were just beginning to achieve a percentage of permanent hair reduction at the point in time when they were expecting to be 90% complete! A large part of the blame for this relates to the fact that Sona took a high-volume “McDonalds” approach to laser hair removal and did not allow the time necessary to perform the necessary test spot procedures before actually beginning treatment. I now recommend that anyone doing laser hair removal spend 15 minutes testing several different energy and pulse duration parameters—and observe after 24 to 48 hours for skin and hair response before actually treating a client. Following the Sona program, I found that time and time again my nurses would go ahead and use the Sona ultra conservative treatment protocols to treat- for example-an entire pair of legs. This session might take 90 minutes (at $20 to $35 per hour for the nurse performing the treatment) and consume over 3,000 precious laser pulses to complete. And under the “patent-pending Sona concept” we would not provide a second treatment for the client treating her legs for four months (the longest treatment interval I have ever observed!). The client would typically have received only three of her prepaid treatments after a year, and she was often still being treated at energy levels below what was required for an efficacious result for her. This was a recipe for thousands of unsatisfied clients and hundreds of arguments for additional free treatments.
Sona represented that they had custom-designed “world class” software that would facilitate operation of multiple centers including scheduling appointments and managing cash. Not surprisingly, their software was a “cheapo” merger of off the shelf Quick Books and Goldmine which proved to be totally inadequate and incredibly cumbersome. The invoicing was so difficult and awkward that my “front office coordinator” would typically spend entire days creating invoices which should have been able to be done in seconds with an adequate software system. And the reports? Forget about it! I have since discovered that the basic $799 MedSpa package sold by Orchid is far superior to what we were provided by Sona. $799 vs. $400,000???
Sona stated that the franchise was a “turn-key” operation; that is, Sona agreed to delivere a center to the franchisee that was ready to operate, requiring only minimal preparation on the part of franchisees. Moreover, Sona claimed that the center could be operated without direct involvement of the owner and entirely through employees (i.e, that it was suitable for investment by an absentee owner). This statement is so preposterous that it doesn’t even deserve a response.
Sona further stated that each franchisee would have a dedicated account executive at headquarters who would be available to assist in resolving any problems or issues. The various individuals assigned to our account during my three year stint had one thing in common—not one of them had actually operated a med spa! Unfortunately, what they also had in common is that they were of absolutely of no help whatsoever. The only advice their head marketing guru could give us when we pleaded with him for help in the fall of 2004 as we were sinking like the Titanic was to “spend more on advertising”. Are you kidding me?
Sona also stated that franchisees would enjoy a large tax savings due to deferred revenue in the first year of operation. This proved to be another incredible trap, and the Sona reports generated by their “world class software system” were a mystery to our tax accountants. Sona’s accounting system required that we essentially keep two different set of books. One accounting was on a cash basis and would track the revenues we took in and our monthly expenses. The second accounting was on the accrual basis and tried to account for the treatments performed as we were not required to pay taxes on amounts taken in for pre-paid treatments until the services were actually performed. Trying to do a standard tax return with this convoluted system was beyond pulling teeth! And with a confusing accounting system and financial statements such s these, can you even imagine how difficult it was to try to produce financial statements in an effort to sell the business?
Finally, it was stated that the Sona business was “high margin” and a “proven business model”. Right! And I’ll see you in bankruptcy court, too!
Unfortunately for me, virtually each and every one of the aforementioned representations proved to be untrue, false, and flat out wrong! As if this wasn’t bad enough, Sona also made a number of promises that were to be delivered “up front” in consideration of its franchisees forking over from $125,000 to $400,000+ including the following:
To provide “world class” training and set-up services, software management systems, advertisements, furniture and fixtures, office equipment and software, medical supplies and other supplies and equipment for opening the center. Sorry. Once again all untrue.
Sufficient training for the owner and up to four other individuals that would be adequate for them to open and operate the center, together with a set of manuals that would enable owners to operate the business. The manuals were Ok for allowing someone to get started with a medspa. Other than that, training was totally inadequate and very amateur.
Assistance with site selection and lease negotiation. My partner and I selected our own site. I had a hard time believing that a real estate “expert” from Virginia could do a better job of selecting a good site than two businessmen who liven in the Twin Cities their entire lives and had retained a local commercial real estate agent.
Advice on construction, set up and opening, organizing the business. Surprise! This was one—perhaps the only- aspect of the transaction in which Sona was quite helpful.
Assistance with determining and assessing the local demographics and hiring staff and a medical director. Their “assistance” consisted of providing us with one sentence recommended help wanted “ads” for the local newspaper! Then again- what do you expect for $400,000!
Assistance with the installation of equipment. What laser company does not do that!
Finally, Sona agreed, during the operation of the businesses, to provide:
Reviews and analyses of the operations of the individual franchisee. Once again, their help was a joke.
Improvements in administrative bookkeeping, accounting, inventory control, and general operating procedures. Are you kidding?
Updates to manuals to incorporate improvements and new developments. Big deal.
Periodic telephone and electronic mail assistance on daily operations, marketing, advertising, financial management, personnel and other operating issues. The real reason Sona took a continuing interest in these matters was to insure that they got their hefty “cut” right off the top. Their “laser placement fee” cut ranged from as high as 27% of gross revenues to 15% based on sliding scale. It was beyond painful to cut them a check for an average of $22,000 each month. After paying an average of $20,000 for advertising, over $20,000 for payroll (average), rent, insurance, supplies, etc. it became impossible to pay ourselves anything after a short while.
Review of proposed equipment, supplies and service contracts to see if they met the specifications of the Sona system. Sona’s one-sided documents gave it absolute control every aspect of the business, so when the business started to fail we were utterly helpless to do anything about it. They even hassled me about trying to sell a sun block as they didn’t offer one during the first 18 months of our stint.
Administration of a system-wide advertising and promotional fund. Sona actually spoke early on about “national advertising” campaigns and had delusions of grandeur about having 100 centers operating by the end of the first year, etc. It was preposterous.
Assistance with laser equipment, servicing, maintenance and repairs. This was such a nightmare I need to dedicate an entire chapter to it—I will get to it down the road.
Ron Berglund
Luxury-price products don't work any better than drugstore brands, according to the study by Consumer Reports magazine, which ranked Olay Regenerist, priced at about $19, as the most effective in reducing wrinkles.
But none of these products made a significant difference in the skin's appearance.
Staffing is the highest expense item for most dermatology practices, often comprising more than 50% of total practice overhead.
Via Skin & Aging Journal. The staff salary national averages in this issue of Skin & Aging were drawn from The Health Care Group�s 2006 Staff Salary Survey. In the fourth quarter of 2005, questionnaires were mailed to more than 9,000 medical practices nationwide and 739 practices responded, including 49 dermatology practices. Those dermatology practices supplied 565 different staff salaries. The complete 2006 Staff Salary Survey, with more staff categories and additional results, is organized by staff position, geographic region and metropolitan statistical area.
SALMON, Idaho (Reuters) - A federal court sentenced a doctor in Boise, Idaho, Monday to six months in prison for injecting 200 people with fake Botox to smooth their wrinkles, officials said.
Ivyl Wells, 66, the former operator of a Boise skincare clinic, in July confessed he sought to boost his profits by purchasing counterfeit Botox at a discount and charging his patients full price for wrinkle-fighting treatments, according to court documents.
These posts are written by former Sona Medspa owner Ron Berglund to provide an inside view of the way medical spa franchises recruit, train, and support their owners as well as detailing some of the problems with medspa franchises.
Read Part 1: Why I bought a Sona Franchise.
The following Sona representations were contained in either (or both) the Sona ads, brocures, web site, franchise sites, the franchise agreement, the UFOC and/or given verbally. Many of the promises and reps were made in each of the above places. All the Sona docs were pretty consistent-- kept repeating pretty much the same crap throughout. Three big ones I recall being made verbally are--
- It had developed a “proven business model” for removal of unwanted hair through laser technology that could be utilized by franchisees with no prior experience in the field and with great success.
- It had the “fastest, most powerful laser technology and offered services at much lower fees than competitors.”
- It had a “patent-pending” “revolutionary” concept, that removed 93 to 97 percent of hair in all areas permanently in five treatments.
- Sona would offer clients a sixth treatment at no cost if the first five had not removed all hair, but that this was “extremely rare.”
- Sona also said that this “patent-pending process” resulted in hair removal in “less time with better results” and that ensured that franchisees had “a compelling competitive advantage.”
- It was safe to use Sona’s laser hair removal processes two weeks after sun (or tanning bed) exposure sufficient to tan the skin.
- After treatments our clients could immediately return to tanning.
- It had other “proprietary technologies” that gave it a major competitive advantage, including a topical anesthetic called “Sonacaine” that minimized any discomfort resulting from the laser treatments.
- Whereas our laser hair removal competitors would be unable to successfully treat blonde, red or gray hair, we would have an “exclusive license” for a product called “Meladine”.“Meladine” was proven to be effective in clinical studies, and made light colored hair follicles “visible” to lasers.
- The use of Meladine would “enable all hair colors to be treated”, would make our Sona Laser Center far more competitive than other laser treatment venues, and would increase our revenues substantially.
- Its operations typically resulted in a 55 percent gross profit margin or more.
- We could expect to achieve “break-even” with gross revenues between $44,000 to $50,000 per month.
- Sona’s franchise offering circular showed pro formas reflecting financial results at assumed revenue levels ranging from $50,000 per month to $125,000 per month and earnings ranging from $288 to $36,240 per month. The same offering circular stated that average monthly gross revenues were over $65,000. At this level, it was stated that earnings would be $6,768 per month.
- We could expect to receive an actual profit of 20% of gross revenues each month.
- Their company-owned laser centers in Virginia were profitable.
- It had surveyed, reviewed and tested all lasers on the market, and had selected only the best, state-of-the-art lasers, manufactured by Cynosure, for use by franchisees.
- Sona’s program provided “continuous maintenance and replacements to keep each center a step ahead of the competition.
- Sona had “television, radio and print media materials … unsurpassed in the industry” that were worth “hundreds of thousands of dollars”. These materials would be made available to franchisees, not only for the grand opening, but also for “the ongoing success of the center.”
- It had a “corporate marketing director” and “marketing staff.” A grand opening event would be planned and executed by Sona that would include press releases, media packages, radio and television appearances, and an “all out media blitz.”
- It provided world-class, state-of-the-art training “that goes far beyond standard industry practices”. Even franchisees who had no prior experience with the market would be fully trained and able to run their businesses successfully. “There is no more in-depth training to be found.”
- They had custom-designed “world class” software that would facilitate operation of multiple centers including scheduling appointments and managing cash.
- The franchise was a “turn-key” operation; that is, Sona agreed to deliver a center to the franchisee that was ready to operate, requiring only minimal preparation on the part of franchisees. Moreover, Sona claimed that the center could be operated without direct involvement of the owner and entirely through employees (i.e, that it was suitable for investment by an absentee owner).
- Each franchisee would have a dedicated account executive at headquarters who would be available to assist in resolving any problems or issues.
- Franchisees would enjoy a large tax savings due to deferred revenue in the first year of operation.
- The Sona business was “high margin” and a “proven business model”.
- To provide hundreds of thousands of dollars in new additional advertising each year as part of the base franchise fee it charged us.
- To provide “world class” training and set-up services, software management systems, advertisements, furniture and fixtures, office equipment and software, medical supplies and other supplies and equipment for opening the center.
- To provide sufficient training for the owner and up to four other individuals that would be adequate for them to open and operate the center, together with a set of manuals that would enable owners to operate the business.
- To provide assistance with site selection and lease negotiation.
- To provide advice on construction, set up and opening, organizing the business.
- To provide assistance with determining and assessing the local demographics and hiring staff and a medical director.
- To provide assistance with the installation of equipment.
- To provide reviews and analyses of the operations of the individual franchisee.
- To provide improvements in administrative bookkeeping, accounting, inventory control, and general operating procedures.
- To provide updates to manuals to incorporate improvements and new developments.
- To provide periodic telephone and electronic mail assistance on daily operations, marketing, advertising, financial management, personnel and other operating issues.
Physicians, plastic surgeons, and dermatologists practicing nonsurgical cosmetic medicine in medical spas, laser clinics and aesthetic practices.
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