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Recession-proof Your Practice

By: Steven H. Dayan, MD, FACS
Posted: January 29, 2010, from the January 2010 issue of
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Abstract: History often is life’s greatest teacher, and this is proven when looking at the businesses that survived the Great Depression. By providing affordability along with repeatable, instantly enjoyable pleasures, Depression-era merchants found the keys to success ... and aesthetic physicians can capitalize by adapting their practices through history’s lessons in order to weather this economic storm.

OK, let’s get this out of the way—yes, the economy is in the toilet. As physicians, sometimes our attitudes get in the way of our ability to recognize the world around us. Just as we can’t let our pride get in the way of good medicine, we must keep our ego from ravaging good business.

Many businesses—including aesthetic practices—will not weather the crisis. Unfortunately, this bad economy is globally affecting all countries and classes. From Wall Street to Main Street, London to Dubai, Singapore to Hong Kong, everyone is feeling it. Those who have heard the tales from elder relatives who lived through the 1930s may be shocked to hear themselves referencing these same stories as they advise their kids and staff members to curb indulgences. Perhaps a look back is not such a bad idea.

Success during the Depression

You can best predict the future by looking at the past. The businesses that prospered during the Great Depression were known as the sin industries, with “sin” referring to alcohol, candy and cigarettes. Interestingly, in addition to the sin industries, another area that remained successful was the cosmetic industry, with many companies holding steady or expanding, including L’Oréal and Revlon.

The sin industries allow a temporary escape from reality, an ability to satisfy a guilty pleasure, and the key is immediate gratification. So, if a quick fix is important, than almost equally as important is affordability. Affordable pricing is essential to achieving maximum gratification and repeat business.