Strategic Planning and Site Placements
Picking the right location is a critical challenge for any hospital or health system looking to grow strategically through a new site placement. Coffee shops provide a simple, yet appropriate, illustration. You have likely seen a hip, new coffee shop that serves great drinks close their doors after six months because it was in the wrong geographic location and couldn’t generate enough business. Perhaps visitors didn’t bother going because it was too far “off the beaten path.” Or there was always a line of cars waiting to turn into the parking lot so everyone who visited ended up frustrated or late to their final destination because of the congestion (and thus, never returned). Either way, you hopefully see the point: whether it’s coffee or medical care, people tend to make purchase decisions based off of location and convenience.
With so much competition for patients among healthcare providers, picking a convenient, attractive spot for your new facility is critical. If you’re considering options for a new urgent care or primary care clinic, here are six key factors to keep in mind:
1. Competition. Who else is located within a block of your proposed location? Five blocks? One mile? How many other clinics does the local population have access to already? There is the obvious problem of trying to place your facility in an overly saturated area. However, if those competing medical facilities are in poor condition–whether due to an old building or poor ratings–your clinic has an opportunity to stand out and draw traffic. Conversely, be careful about placing an office in an area that completely lacks competition. If no one else is in your area, there may be a reason as to why, so dig deeper and investigate. Depending on the goals for your clinic, you may need to reconsider.
2. Traffic Patterns and Consumer Habits. What else is in the area of your potential primary care clinic? Nearby restaurants and shopping outlets can increase traffic flow by putting medical care on the same route as other day-to-day activities. Rather than forcing people out of their routines to get a primary care checkup, you are allowing them to integrate their medical needs into their daily lives; the ultimate convenience. Never underestimate the power of convenience for making happy customers.
3. Visibility and Access. Going back to the coffee shop analogy, it’s nice to know where you can find caffeine even when you don’t need it—just in case the mood strikes you, or you want a quick cup before a meeting. The same principle holds true for medical care. People want to know where your clinic is, so if and when they need you, they can make an immediate decision and route themselves there quickly. Top-of-mind awareness is critical for gaining traction and retaining customers. Look for locations where your target patients will see you and absorb your presence, even (maybe especially) when they don’t need your healthcare services.
Think about your last industry conference. Chances are you walked past at least two drug stores and/or urgent care clinics on the route between your hotel and the conference center. When it came time to buy a small bottle of ibuprofen on the last day, you knew exactly where to go the moment you woke up with a headache. Attract your potential patients by giving them the same courtesy.
4. Goldilocks Traffic. Just like in the old fairy tale, too much or too little of anything is never just right. When relating this to a new site placement, you must consider the volume of foot or vehicle traffic surrounding the area of your potential new facility and determine if it will be the right match for your needs. Too little, and you simply may not have the influx of people needed to support your clinic. Too much, and your patients could have a hard time getting into the parking lot. Be sure you aren’t so focused on maximizing traffic that you end up making it harder for patients to get in the door. You need to strike that “just right” balance of volume for the patient flow.
5. Facility Funnels. By adding satellite clinics, you’ll increase traffic, top-of-mind awareness, and overall utilization of your entire suite of services. Small primary care or urgent care clinics placed at a strategic distance from your main facility will create a new point of access for potential patients that were previously outside your reach.
These new, satisfied patients will be more likely to use other components of your network for their tertiary medical needs once they are introduced to your network, increasing your overall customer lifetime value.
6. Demographics. Who is the ideal patient for your new clinic? Once you know who they are, find out where they are and how they spend their free time, then place your facility in an area that acts as a destination for them. Understanding the socioeconomics of your target patients plays an important role in the success of a clinic. For example, both primary and urgent care practices see heavy use by pediatric patients, so suburban neighborhoods with several starter homes can be attractive. However, pediatric patients are often insured through Medicaid, so just finding a large population of young families is not where the search for an ideal location ends. Average income and insurance status will lead directly into payment and reimbursement status and are two aspects that cannot be overlooked. As another example, urgent care clinics may be an attractive option for areas with a high proportion of twenty-somethings. This group does not usually have a primary care provider as they are transitioning into adulthood and enjoy quick, convenient service. However, utilization of this group could be lower as they may avoid going to the doctor altogether. What’s most important is that you get to know your local population. Then understand that what works for one group in one area, may not work for the same type of group in another.
It’s important to find the right balance of these six points in order to maximize the success or your new facility. With heavy market competition and the constant evolution of infrastructure in urban areas, this can be a daunting task. Stratasan’s Spark Services offer a comprehensive suite of tools and analysis that will help you evaluate the demographics, traffic, and competition of a potential location in order to streamline the selection process. Give us a call to learn more about how we can help you zero in on just the right spot.
Article by Morgan Atkins, Senior Director of Innovation for Stratasan