Massage therapists or practitioners can be loath to agreements. They love the idea of working together, but often despise working out money terms in a long-term working agreement. The unwillingness or inability to work through the financial terms of a contract can cost thousands of dollars to the clinic owner over time if outgoing expenses are greater than incoming revenue, and great hassle and expense to the contracting practitioner having to relocate. With such a wonderful symbiotic opportunity, why do so many clinic-owner or contracting-practitioner agreements go sour? I think the foundational presumptions are to blame. This series examines six common presumptions.
Presumption # 3 – “Straight Percentage Agreements Are Best”
For short-term locum or limited relationship situations, straight percentage agreements can work well. For long-term relationships built on rapport, trust, and respect, they are problematic.
The rent paid by the contracting practitioner is variable – this means it may cover operating expenses in some month’s but not others, and during the first year of start-up the clinic owner often has to carry the contractor’s costs with the idea that it’s an investment in the future relationship…but the relationship must last to see that return on investment.
If operating expenses per treatment room are $1000, and the contracting practitioner pays on average $800 per month, whose pocket does the shortfall come from? Some practitioners argue they should only pay for expenses incurred when they work. However, unless the owner can lease out space or equipment while the practitioner is away (a human resource nightmare), then expenses continue. Consider this analogy – if you called the bank holding your mortgage and told them you won’t be using your house while on vacation, would they knock off two weeks of mortgage payments?
I would argue percentage-only agreements are not good for contracting practitioners either. When starting out giving away only a portion seems reasonable, but when the practitioner gets a steady stream of business, the rent can seem onerous and disproportionate…especially with no cap. Straight percentage agreements over the long term encourage turnover and an “us versus them” mentality. For long-term relationships, you need increased accountability and increased opportunity for financial reward on both sides.
Don Dillon, RMT is the author of Better Business Agreements and the self-study workbook Charting Skills for Massage Therapists. Over 60 of his articles have been published in industry publications including Massage Therapy Canada, Massage Therapy Today, AMTA Journal, AMTWP Connections, and various massage school and professional association newsletters. Don’s Web site, www.MTCoach.com, provides a variety of resources for massage therapists.
Don has presented to members of the Massage Therapist Association of Alberta (MTAA), the Association of Massage Therapists and Wholistic Practitioners (AMTWP), the Massage Therapist Association of Saskatchewan (MTAS), the Massage Therapist Association of Manitoba (MTAM), the Association of Massage Therapists of New Brunswick (ANBMT), the Massage Therapist Association of Nova Scotia (MTANS) and the Ontario Massage Therapist Association (OMTA). He also presented to the pre-graduating class of 2008 at the AtlanticCollege of Massage Therapists.