After completing the acquisition of a physical therapy or accounting practice, you likely feel excited about your opportunities for growth. However, it’s easy to overlook the potential for customer churn during this transition. Discover what to know about churn following an acquisition and how you can avoid it.
What Is Customer Churn?
If you are unfamiliar with the term “customer churn,” it refers to clients discontinuing their relationships with your practice and seeking services elsewhere. Owners can calculate their practice’s rate of churn by dividing the number of clients they lost during a given timeframe by the total number of clients they had at the beginning of that period.
Understanding churn is essential for practice owners because it directly impacts revenue and growth. High churn rates can be particularly damaging after an acquisition, as they may erode the value you expected to gain from the transaction. The cost of acquiring new clients is also typically much higher than retaining existing ones, making churn prevention a major priority.
How Can I Prevent It?
Although the effects of customer churn can be devastating to your newly acquired practice, you can take steps to avoid or limit it. Review these tips for lessening customer churn to preserve your new business.
Learn To Recognize Churn Symptoms
One way to prevent client churn is by identifying at-risk clients before they leave your practice. Clients can display several warning signs that they are discontinuing their relationship with your practice, including decreased engagement. This might manifest as cancelled appointments, delayed responses to communications, or reduced participation in planning discussions.
When clients express concerns about changes in staff turnover or operational procedures, you should take these comments seriously. Doing so allows you to address concerns swiftly, improving your chances of retaining clients.
Focus on Strong Client Communication
Effective communication is an excellent tool for preventing churn following an acquisition. Clients need to understand what the acquisition means for them personally and how it will affect your services. You should begin this communication before you finalize the acquisition and continue it throughout the integration process.
Transparency about changes, timelines, and expectations reduces anxiety and builds trust during the transition period. Regular updates through multiple channels, including email, phone calls, and in-person conversations, ensure that clients receive consistent information about the acquisition. These communications should address concerns such as whether their primary provider will remain the same, how billing processes might change, and what new services or benefits might become available.
Personalized communication is vital for clients with complex needs. This differentiates your approach from competitors and reinforces the value clients receive from staying with your practice.
Enhance Your Services
An acquisition also provides you with an excellent opportunity to enhance the services you offer, which can improve your retention rates. By combining resources, expertise, and capabilities from both practices, you can often provide more comprehensive service offerings that weren’t previously available. This enhancement strategy transforms potential disruption into clear value propositions for existing clients.
Consider how the acquisition allows you to offer extended hours, additional locations, or specialized services that clients have previously requested. In physical therapy practices, this might mean adding new treatment modalities, specialized equipment, or expertise in specific health conditions. For accounting practices, enhanced services could include expanded tax planning capabilities, financial advisory services, or improved technology platforms for client communication and document sharing.
Make sure you communicate these enhancements effectively and help clients understand how the acquisition directly benefits them. When customers see tangible improvements in their experiences, they’re much more likely to have a favorable view of the acquisition and remain loyal.
Respond Immediately to Client Complaints
The post-acquisition period is a critical time to address client complaints with urgency and care. Complaints can reflect broader anxieties about change rather than isolated service issues, making prompt resolution even more critical for retention. Delayed responses to concerns can amplify the clients’ fears that the acquisition negatively impacted service quality or attention to individual needs.
Establish clear protocols for handling complaints during the integration process, ensuring that all staff members understand the importance of quick resolutions. This might involve designating team members to handle acquisition-related concerns or creating expedited resolution processes for issues that arise during the transition period. The goal is to demonstrate that client satisfaction remains the top priority despite organizational changes.
Follow-up communication after resolving complaints is equally essential, as it reinforces your commitment to client satisfaction and provides opportunities to rebuild customer confidence. Consider following up with clients who have raised concerns to ensure their ongoing satisfaction and address issues before they worsen. This approach often transforms potential churn into opportunities to strengthen your client relationships and demonstrate the quality of your service.
Keep an Eye on Your Competitors
Another important tip is to keep a watchful eye on your competitors. Acquisition periods create opportunities for competing practices to target your clients with aggressive marketing campaigns or special offers designed to capitalize on their uncertainty. Staying aware of these competitive activities in your market allows you to protect your client base from opportunistic competitors.
You can learn about the alternatives your clients are considering and why they are attractive. Then, you can address threats directly by emphasizing your unique advantages or matching offers when appropriate. For example, if a competitor is promoting faster appointment availability, you can implement scheduling improvements to address this concern.
Managing churn after an acquisition requires proactive planning, consistent communication, and unwavering focus on client satisfaction. By recognizing early warning signs, maintaining strong relationships, and leveraging the acquisition’s benefits to enhance service, you can navigate this challenging period successfully. Investing in retention strategies during this critical time will pay dividends in long-term success and profitability.
Private Practice Transitions can help you in this process with our experienced physical therapy and accounting business brokers. We will work with you to find an investment opportunity that fits your needs and allows you to thrive financially. Call us today to get started on the acquisition process.
