It's a great time to be a chiropractor
Chiropractic practices and other healthcare practices are listed as the fifth most profitable type of business by Forbes Magazine. The magazine used “average pre-tax margin” as its benchmark, stating that chiropractic practices have an average pre-tax margin of 17.5 percent. The article also stated that chiropractors have the advantage of working outside the health insurance/HMO environment and collecting directly from patients, adding to their profit-making potential.
See Forbes “In Pictures: The 10 Most Profitable Businesses to Start."
What does “average pre-tax margin” mean? Pre-tax margin is defined as net profit before taxes divided by net sales. For example: If a practice has a pre-tax profit of 17.5 percent and an annual gross collections of $200,000 should have a profit of $35,000. This profit amount includes salaries and benefits of owner-employees and all other business expenses. Contrast this margin with that of accountants (most profitable at 20.5 percent) and bakeries (one of the least profitable at -0.9 percent).
What is the mean (average) total compensation for chiropractors? Find out from the Chiropractic Economics salary and expense survey.
Jean Murray has an MBA and a PhD in small business management and has been counseling small business owners since 1974. She is a business professor at Palmer College of Chiropractic and principal of Planning for Practice Success (P4PS). Jean can be contacted at 866-940-7526 or through her Web site, dcpracticesuccess.com.