First, to be clear, the most important thing for the success of your private practice is obviously not a number.
It’s the quality of therapy you provide your clients.
No matter any numbers, if you aren’t a good therapist, current clients will leave because you’re not solving their issues, new clients will stop coming because word will get out, and your practice will languish.
Having said that, being a great therapist isn’t enough.
You also need to run your practice in a way that reaches your ideal clients and keeps them in therapy long enough for you to make a difference for them.
So, assuming you do provide great therapy, here are 5 numbers critical to your success.
These are numbers that we track for my wife Risa’s practice, and that let us know where we’re doing well, and where we can and should do better. As a result, we know where we need to pay special attention and put in more effort. Do the same, and your practice will make a difference for more clients, and your bank account will thank you too.
1. Enquiries - How Many People Are Calling You?
Your ideal clients are out there, desperate for your help. However, if they don’t know you’re there, they won’t call.
Your marketing effectiveness is what gets them to call, email, or text you in the first place.
All other things being equal, the more ideal clients who call to enquire about your services, the more difference you’ll be able to make, and the more successful you’ll be.
A while back, Risa anxiously asked our Google ads guy why the phone stopped ringing. On many other occasions, she tells me it’s ringing off the hook.
However, without tracking enquiries, all you can go on are such anecdotal feelings. Feelings that could be overly pessimistic, causing needless anxiety; or unjustifiably positive, preventing you from realizing you have a problem.
To make sure your feelings are in line with reality, keep track of how many people reach out to you each month, and see if the number is going up (good), down (bad), or staying stable (good only if your caseload is where you want it to be). If the number isn’t where you need and want it to be, spend some time improving your marketing and networking; and consider spending more on e.g. Google and/or Facebook ads.
2. Conversion - What Fraction of Calls Result in a Client Session?
Stated simply, this is the fraction of enquiries that lead to a client sitting in front of you for an initial session. Again, the higher this number, the more clients you see, the more of a difference you can hope to make, and the more successful your practice.
Risa used to have someone answering the phones who was wonderful with client calls for a long time.
Until she wasn’t.
It was only by tracking conversions that we realized we were losing clients every month because she no longer responded to them as quickly or well as she used to.
Needless to say, Risa now has someone else answering the phones.
Track this number monthly too. Simply divide the number of clients who come in for their first session by the number of enquiries you had.
There’s a slight wrinkle in that sometimes a client will call in, say, January, and set a first appointment for February. When that happens, record the conversion for January.
Increasing your conversion is better (though usually harder) than increasing your enquiries, because much of your marketing costs are likely tied to how many people your ads drive to your website. If your conversion is low, you’ll pay more for each client who shows up.
As long as your caseload is where you want it to be and your marketing costs are acceptable, you can leave things as they are. If you want to increase conversion, consider how you respond to enquiries. How long does it take before you respond, and as importantly, what do you say when you talk with the prospective client.
Try to role-play with a non-therapist friend who may be similar to your ideal client, and see what she says about how you come across.
3. Retention - How Many Sessions (on Average) Do Clients Stay?
So, clients are reaching out to you, and you show (some of) them that you’d be a good fit, so they come to an intake session.
At the end of that session, some will decide therapy is too hard, or they don’t like your voice, or they hate your décor, or whatever, and they won’t come for a second session, let alone enough sessions for you to have an impact on their issues. It’s inescapable that this will happen with some clients.
This tells you that you’re bringing in clients who aren’t your ideal ones. If that happens too much of the time (say more 1 in every 3, 4, or 5), you may need to update your website content and what you say on the phone to people calling you, so they know if you’re not a good fit or if they’re really not ready for therapy yet at all.
It’s also likely that some clients will stay for a few sessions, but as soon as they start feeling relief they’ll stop coming. You won’t be able to make much of a difference for these clients either. To make that difference, you need to keep them in therapy for long enough that they can work all the way through what they’re facing.
Achieving this is really important, and unfortunately, it’s not just up to you. However, you can help clients stay in therapy for as long as clinically appropriate by telling them ahead of time how long it may take, how much work it will be, but also what they may get out of completing therapy.
Last year, we saw that one of Risa’s associates was losing about every other client after a single session. The half that stayed would immediately go to one or two sessions per month, and would mostly leave after 2-3 sessions total.
Not only was the practice actually losing money on clients assigned to this associate, more importantly, most of those clients were not having their problems addressed as well as they needed.
Risa talked with the associate, explaining the problem and suggesting solutions. When things continued unchanged for a couple months longer, she had to let the associate go.
Especially if you’re running a group practice, update daily the session count for each client who comes in, and calculate once every 3 months what your average is across all your clients (for a group practice, do this by clinician).
If you see your average retention number increase, you’re doing better. If it drops, you need to change something, likely better managing client expectations, including that they can expect to feel improvement before their issue is fully resolved.
Retention is vitally important, but you have to be careful to avoid several pitfalls. That's why I plan to spend an entire article on it soon. If you aren't already on my mailing list, subscribe via the free worksheet link below to make sure you don't miss that follow-up article.
4. Expenses - How Much Are You Spending?
This is an obvious one.
The higher your expenses, the more money you need to bring in so you can stay in business and keep helping people.
Some expenses are fixed (think rent if you’re renting full time or by the day, marketing through directories such as Psychology Today, utilities, etc.), while others are variable (think supplies, rent if you’re renting by the hour, marketing when you pay per click, etc.).
If more clients come in and stay longer, your fixed expenses get split among more sessions, so you make more money per session on average.
Record your expenses daily or weekly, and review them monthly to see if there are any big changes that aren’t explained by having provided (hopefully) more sessions.
5. Fees - How Much Are You Charging?
If you haven’t already done so, go now to get my free rate-setting sheet and fill it out to get a sense of what you should be charging at a minimum per session.
Ideally, you want to charge enough that with the number of sessions you’re able to deliver, you cover your business expenses, your taxes, your personal expenses, and enough extra to save for retirement, college education for your kids (if any), emergency fund, and the occasional vacation to refresh and recuperate so you can keep making a difference for your clients.
Your fees don’t need tracking, but they do need to be set high enough, and need to be increased over time as inflation eats away at your purchasing power, as your expenses increase (e.g., your kids start college), and as your experience and ability to help clients improve over time.
Assuming you’re a good therapist, the above 5 numbers will mean the difference between success and failure for your practice.
Routinely recording and tracking these numbers will keep your finger on the financial pulse of your practice. That will let you figure out if and when something is going wrong, before your bank balance cries “Uncle.”
If you’d like some help with setting up your practice to stay on top of these critical numbers, send me an email and we’ll set up a free 20-minute phone call to see if my coaching would be a good fit for your needs.