Optometrists Building Empires

E116 · Republish. The full original E028 conversation with Nathan Hayes, director of financial services at IDOC. First aired February 20, 2025. 41:34.

The short version

Nathan Hayes works on practice financials with independent optometry owners. He also helps run Books and Benchmarks, a bookkeeping and benchmarking service from IDOC.

When an owner tells him they want a second location, his first question is always "why?"

This is the full conversation, back in the feed: what multi-location owners do well, who controls each line of the P&L, the cost targets he watches, EBITDA, what buyers pay, and why stepping back can make a practice grow faster.

If you are thinking about location two, start here.

The named problem

A second location adds complexity, stress, and risk. Many owners plan the lease and the equipment. Fewer plan who runs the first office when they are not there.

Nathan sees the same gap again and again. The title "manager" goes to the most senior person. Nobody writes the job description first.

The hidden mechanism

Your first office has to run without you before you open the second. Your attention moves to the new location. The first office has to manage itself.

Nathan wants three things in place first:

  • A team that does not depend on the owner for every decision.
  • A real manager who can lead and hold people accountable.
  • Enough cash flow to take a hit to your income in year one.

The convincer

Nathan puts practice money into buckets. One bucket is cost of goods plus non-OD staff. His historical target for that bucket: about 50% of collected revenue. Then he shows how far inflation has pushed that number.

He also explains EBITDA in plain words. Then he walks through what an individual doctor pays for a practice, what private equity pays, and why.

Numbers take the fear out

Most owners know what their practice needs. The fear shows up when it is time to spend money: the next hire, a bigger space, another doctor.

"It can take the fear out and the risk out and help people make better decisions."

And the line on why to grow at all:

"You're doing it because you want to and not because you're scared."

What to do this week

  1. Write down why you want location two. Name the goal: income, free time, challenge, or impact.
  2. Add up cost of goods and non-OD staff for the last 12 months. Divide by collected revenue. Compare it to Nathan's numbers in the episode.
  3. Name the person who runs your first office when you are not there. Write their job description this week.

If you want help running the numbers on your next location, book time with Ankit below.

Chapters (ASR stamps, approximate)

  • 00:00 Show intro
  • 00:27 Meet Nathan Hayes
  • 01:23 What successful multi-location owners have in common
  • 03:30 Same model or a new model at each location
  • 06:05 The common pitfall: the manager bench
  • 08:16 Who controls what on the P&L
  • 11:10 Scale means fighting complexity
  • 12:49 What to hit before you expand
  • 13:43 Three buckets and the 50% target
  • 15:30 Why fees cannot keep up with costs
  • 16:23 EBITDA explained
  • 17:38 How multiple sites change the exit
  • 20:28 Multiples: individual buyers vs private equity
  • 21:37 Run the practice for the income it pays now
  • 22:22 Grow because you want to, not because you are scared
  • 25:08 Stepping back makes the practice grow faster
  • 25:56 The two-week vacation test
  • 28:35 Fixed overhead at scale
  • 30:12 Doctor pay plus EBITDA as a benchmark
  • 31:03 How to manage rising labor costs
  • 33:16 Nathan's story
  • 35:39 Why Books and Benchmarks exists
  • 38:15 Where to find Nathan

Connect

Ankit Patel (host) - Optometrists Building Empires: https://buildingempires.live - iCare Grow: https://icaregrow.com - MyBCAT: https://mybcat.com - LinkedIn: https://www.linkedin.com/in/ankitpatelcvc/ - Book time: https://mybcat.com/book/discovery

Nathan Hayes (guest; copied from the live E028 page) - LinkedIn: https://www.linkedin.com/in/nathan-d-hayes/ - Company website: https://idoc.net/ - Books & Benchmarks: https://booksandbenchmarks.com/author/nathan-hayes/

Original E028 page, "Financial Insight": https://buildingempires.live/episodes/financial-insight-nathan-hayes-optometrists-building-empires-episode-028

Listen

https://share.transistor.fm/s/edbeb65d

What is Optometrists Building Empires?

Welcome to Optometrists Building Empires! Each week, host Ankit Patel, explores the journey of practice ownership and leadership in optometry with some of the top minds in his field. This show is sponsored by My Business Care Team: We help increase revenue, reduce costs, and reduce staffing headaches. Let's build your empire together!