3 Things ASCs Can Learn From Nasty Gal's Sophia Amoruso
Sophia Amoruso, the 30-year old founder of the vintage clothing store Nasty Gal, discusses her business philosophy in a recent Wall Street Journal article. Here are three core concepts that can apply to ASCs and physicians practices.
1. Cash is king. Ms. Amoruso grew Nasty Gal from an eBay store to a standalone website and soon to a physical location in Los Angeles. Her business had $28 million dollars in positive cash flow before speaking to investors.
ASCs should focus first and foremost on month to month cash flow. Does cash coming in the door exceed dollars going out? Does the ASC have 30 to 60 days of cash reserves at all times?
2. Operating debt-free. Ms. Amoruso built her company from the ground up and managed to avoid debt. "My experience building that business is a very unconventional one," she said in the report. She raised money from a person she "really liked" instead of taking out loans.
In an ASC, avoiding each debt and onerous lease costs is critical. Debt and too big of rent give the ASC less flexibility as the environment weakens and changes. It can be very difficult for ASCs to ever excel if excess debt is taken on. Limiting debt is a terrific concept and strategy.
3. The online platform. Nasty Gal began in the online space and eventually moved towards a physical space due to its enormous success. Last year, the company generated more than $100 million in revenue, according to the report. "The internet gave me a platform to become an entrepreneur," she said in the report. ASCs and physician practices have well-established locations, but building an online presence can serve as a way to attract and drive business. This is especially important as consumerism is becoming paramount in the healthcare space.
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