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CASE REPORT
AVRIL 3, 2018
LEAD HEALTHCARE CONSULTANCY SARL
MAJIDA center – Boulevard – Tripoli – Lebanon
Introduction:
In the North Lebanon province, there are 85 physiotherapy centers, but the majority of these centers are deprived
of a constitutive concept, and strategic vision. Most of them are only an individual firm providing almost a classical
physiotherapy to various pathological cases. While in Tripoli there are 26 outpatient physical therapy centers, 3
large centers with internal residence and 8 hospitals with 7 include small physiotherapy cabinets, noted that
500,000 Lebanese live around Tripoli which 150,000 are expatriates (emigrants of other regions).
The foundation of a successful physiotherapy center in Tripoli, is a question of ambition since my graduation, "Me
Farah Haddad, graduated in physical therapy since June 2005," but I realized that such a project requires a study
showing its viability which means a feasibility study of founding a center of physical therapy in northern Lebanon.
This center should be characterized by a multidisciplinary treatment offered: (orthopedics, rheumatology,
dermatology, cardiology, sports physical therapy, aesthetic, relaxation), the selection of key personnel, whose
experience should be relevant, closely meet our strategic issues and give the center a competitive advantage.
FARAH WELLNESS is the name chosen for this potential center (FARAH: my name, WELLNESS: Wellness is an active
process of awareness and choice for a healthy and fulfilling life.). FARAH WELLNESS will be a multidisciplinary
physiotherapy center fully equipped, to be established in Tripoli. Armed with multiple pioneering features, it will
offer physical therapy closely linked to new international guidelines, while accommodating regional culture.
Targeted to the growing demand of specialized physical therapy prescribed by specialist doctors. Thus, our
strategic vision also constitutes one of our managerial concepts, it is to promote excellence in the practice of
physiotherapy ensuring fair compatible treatment and necessary measure for pathology, or even for each patient
or client, following by promoting the interaction between the therapeutic team and patients.
Providing the latest developments in the field of physiotherapy and given the proper planning of the
characteristics of renewed by Farah WELLNESS, the center is a good investment opportunity and will report in
both revenue and profit for the payback in next three years maximum.
As a private project (answering personal ambitions), the available funding resources of FARAH WELLNESS center
must be carefully selected, among which there is a distinguished one, which seems to be very relevant to us, as
the loan given to start up or even for future entrepreneurs, the amount and payment period are discussed based
on the feasibility studies illustrating the net cash flows of the project.
Environmental analysis:
PESTEL Analysis:
Policies Economical
· Political instability and dominant slot on · Minimal growth rate
most parameters of the country. · limited financial capacity
Sociological Technological
· Demographic trends (roughly 470,000 ·Technological evolution accelerating the
inhabitants in Tripoli) obsolescence of equipment
Environmental Legal
· Mediterranean Country full of self-recovery · Offset between OPTL rates and official rates
capabilities (MS, NSSF, COOP, army)
Strategic groups:
The physiotherapy providers in north Lebanon are: (85 centers and almost 300 physiotherapists) may be
distributed in four groups, as follows:
· 3 large internal residence centers, where the patient is able to stay inside the center during the treatment
period, all these three centers are located in Tripoli.
· 61 external physiotherapy offices (26 in Tripoli) often occupied by a single physiotherapist, except 2 centers
that are the real competitors (SHRC & PHYSIOLAB) and both are multidisciplinary centers.
· 21 (7 in Tripoli) including physical therapists in hospitals.
· Almost 100 free physiotherapists do not belong to any of the previously mentioned groups, these therapists
deal only homes services.
Among all the above: 3 centers constitute only the most efficient competitors to our future center Farah
WELLNESS, those are: 2 external centers (SHRC) and (PHYSIOLAB) and internal residence center (RAHMA) due to
adoption of strategic characteristics similar to those that affect us as multidisciplinary and quality of treatment
offered. While others are less efficient competitors, may be regarded as small private firms offering multiple
therapeutic services by a single therapist (usually the owner), and the remaining free physiotherapists have limited
capacities, with non-denial of seizing market share.
Distribution of physiotherapy providers in North Lebanon
Tripoli 3 26 7 15
In the
0 35 14 40
suburbs
Northern
3 61 21 55
Province
Market segments:
Customer needs may vary in the following dimensions, characterized by the same time our areas of strategic activity:
· Pure Physical therapy
· Aesthetic
· Wellness
Taking into account that the majority of patients (or clients) come to physiotherapy centers following a medical
prescription first, and after following a conversion specifically by the guarantors. We can divide the physiotherapy
market into three categories :
Market segments:
Q1: Questionnaire to doctors in order to make a useful summary for the market study:
1) How do you find the relationship between your specialty in medicine and physiotherapy:
Close Moderate poor
2) How much do you estimate the monthly average number of your (X patients) requiring physiotherapy:
X = ....
5) On What parameters you base to approve that a physiotherapy center has a high quality rank:
(1) Well equipped
(2) Qualified and specialized
Personnel(3) Personnel Approach
6) Are you currently updated with EBP news (EVIDENCE BASED PRACTICE) in physiotherapy:
Yes No
7) which among physiotherapy equipment in your opinion seems essential for a multidisciplinary physiotherapy
center:
o
n
e
e
g
s
r
o
e
s
r
t
l
d
edic
o
n
P
y
r
l
Dr. average 5 4 no - no - no
M.KHODREIN
is
D
o
g
e
a
r
t
l
Dr. R. RIZK
Dr.G . KALAM O NI
Faible
Fai bl e
1 5 non 3 non ShapeLPG
non
Dr. O. OUWAYDA Faible 1 10 oui 3 non Laser oui
60%
40% LPG
Moyens 100% 0.4 3 80% N (3) 100% 20% les 80% O
20% O 40% N autres 20% N
(1)
1
PlasticSurg
Dr. I. MELKI
1
eon
Dr. C. Faible
WALFRANCE
Dr.A . HALA BI
Faible
M oyenne
50%
50%
75% F 100% - (1) 100% LPG 75% O
25% 25% M
(2)
Averages 25% M 0.25 -- - 25% -- N 25% -- 25% N
45%
45%
(1)
45% N LPG
89% F 33% 100% 11% Me 78% O
0 0 10% O (3) 11% ma
11% N 11% Vil 22% N
(2)
Total Averages 11% M 45% -- 11% -- 11% LA
Conclusion:
Bearing in mind our strategic business areas, and while pairing with these results we can extract the majority of
real patients (perhaps 84%) are referred to Physical Therapy by a specialist physician, hence the need to target
marketing B to B. While the prospects of the other two: aesthetics and wellness, are often free of medical
orientation (the opposite of what we waited) and should be targeted by a marketing B to C.
Marketing strategy:
Based on preliminary market study, made in advance, relevant means appropriate marketing our strategic areas can
be adopted. First starting with our business strategy, and after writing a marketing strategy.
SWOT Matrix
Strengths
S Weaknesses
W
Multidisciplinary service Lack of reputation masking the center's
Evidence-based physiotherapy innovations
Credibility in treatment
Modern equipment
Magnetic card system Internal
Exceptional website Factors
Ability to review online files
Service to bring and bring back patients
Opportunities
O Threats
T
Attract NGOs and charities to common programs Unstable political situation
Affinity systems for insurance agents High level of poverty
External
Collaboration with hospitals Continued manipulation of tariffs, and incapacity
of the order to demand its laws. Factors
Favoritism and regionalism widespread
Patients pay attention to the names of
physiotherapists and not centers as an entity.
Intentional misleading rumors
Possible regional war
Positive Negative
Factors Factors
Materialization with symbolic Support:
- Logo: A choice of a logo for the center's principal for the symbolization and distinction of our services. Keeping in
mind the need to reshape the subtitle for each of our business areas. Our logo could be as follows:
- Advertising: direct advertising on various media is prohibited for physiotherapy services, but this is not
the case for other fields of activities. Yet participations in scientific discussion programs that may constitute of
indirect marketing about the characteristics of our center. Also an internal branding should be implemented.
- The website: a very typical website is a very relevant way for better communication with doctors, patients,
customers, potential customers and the center at the same time:
B to B Marketing:
- Launch Dinner
- Regular tour
- Referral system
Marketing B to C
- Radio Announcement
- TV health program participation
Services:
Physiotherapy:
Orthopedics
Neurology
Rheumatology
Sports Therapy
Pediatric
Musculoskeletal
perineal and pelvic rehabilitation
Aesthetics:
cellulite Treatment
shaping and facelift
Mesotherapy
Hair Removal
Wellness:
Acupuncture
Massage
Cosmetics
Equipment:
therapeutic Equipment:
Therapeutic Equipment
Physical Therapy Equipment QTY Marque Prix ($)
1. Électrostimulation 1 CHATANOGA 2,200
2. SHOCKWAVES 1 18,000
3. Infrarouge 1 ENRAF 660
4. KINETEC 1 ENRAF 3500
5. Table de massage électrique 1 GYMNA 800
6. Table de massage électrique + traction électrique 1 ENRAF 3,500
7. Haltères (de 0.5kg jusqu'à 5kg ×2) 1 Class sport 66
8. Plateaux Freeman (2 rectangulaires et 2 circulaires) 4 -- 200
9. Espalier 1 MARS 390
10. Matelas 1 MARS 80
11. Barre parallèle 1 ENRAF 275
12. Coussins semi circulaire 2 INERTCARE 110
13. Coussins circulaire 2 INERTCARE 110
14. Coussins régulières 2 INERTCARE 110
15. Balance digital 1 100
16. Bicyclette pour cardiologie 1 Life-gear 1000
17. Tapis Roulante 1 Life-gear 1000
18. Doigtier 1 -- 50
19. Les draps (brodé par le logo du centre) 25+ -- 250
20. Serviettes (brodé par le logo du centre) 25+ -- 250
21. Cold-pack avec 1 réfrigérateur spécifique 4 G.M 200
22. Cônes pour rééducation 10 -- 40
23. Petite chariot rembourrée incluant des tiroirs 2 -- 200
Totales des prix 33,091
équipements d’esthétique : Qté Marque Prix ($)
1. LASER HAIR REMOVAL 1 MEDICA 95,000
2. Mésothérapie (rollers + seringues) 1 -- 500
3. Chaise de beauté 1 1,500
4. Cavitation 1 Existe ? 6,000
5. Radio Fréquence 1 Existe ? 6,000
Totales des prix : 109,000
équipements du Spa: Qté Marque Prix ($)
1. Table de massage électrique 1 GYMNA 800
2. Vibromasseur mené d’un chauffage 1 -- 500
3. Paquets d’instruments de massage 1 -- 500
Totales des prix : 1,800
Totales des tous les équipements thérapeutiques: 143,891 $
Information System Equipment:
3. Computer 2 1400
7. Website 1500
Furniture
Human resources:
Physiotherapy 25 × 20 500
Aesthetics 50 × 14 700
Wellness 60 ×8 480
Investment:
Investment is defined here as, the total amount spent to acquire durable goods used by our center for at least 3
years. Thus, the total investment cost will be:
Total investment cost
Types Coût en $
Establishment cost 719$
Decoration 8,000$
Furniture 6,620$
IS Accessories 4,060$
PT Equipment 33,091$
Aesthetic Equipment 109,000$
Wellness Equipment 1,800$
Total costs 163,290$
Expenses
Total 16,864 16,864 16,864 16,864 16,864 16,052 16,052 16,052 16,052 16,052
o Fixed costs:
Total fixed cost
Charges Coût annuel
Salaries 47,208$
Advertising 8,900$
Maintenance 1,000$
External Charges 2,800$
Long Term Loan Payment 12,000$
Financial Charges (Loan) 4,000$
Short Term Loan Payment 36,666$
total 112,574$
o Variable Costs
Distribution of consumable supplies
Description Unit Price in $
Data Collection paper 0.014$
Magnetic Card 0.5$
Visit Card 0.1$
Reports for physicians 0.05$
Envelops 0.05$
Plastic bags for sheet 0.03$
o Raw materials:
Row Material Cost
Description Unit Price in $
Massage oil (flacon 75ml) 3
Massage Cream 2
Contact gel 2
Alcohol or sterilizer 3
Revenues
Pessimistic scenario:
Turnover Distribution According to strategical Groups (P scenario)
Year 1 2 3 4 5
Occupancy rate 20% 30% 40% 50% 60%
Patient/day 4 6 8 10 12
PT
Financial Analysis:
Annual cash Flow:
First, here is the list of abbreviations:
o TO : Turnover o DA : Depreciation & amortization
o VC : variable Cost o GOI : Gross operating income
o CF : Fixed Cost o o T : Tax
NR : Net Result o GCF : Gross cash flow
o NCF : Net cash flow
Pessimistic scenario:
Annual Treasury flow, pessimist scenario
Year 1 2 3 4 5
TO 182,640 273,960 365,280 456,600 547,120
VC (13,827) (20,740) (27,653) (34,566) (41,471)
FC (112,574) (112,574) (112,574) (112,574) (112,574)
GCF 56,239 140,646 225,053 309,460 393,075
DA (16,864) (16,864) (16,864) (16,864) (16,864)
GOI 39,375 123,782 208,189 292,596 376,211
T (15%) 5,906 18,567 31,228 43,889 56,431
NR 33,469 105,215 176,961 248,707 319,780
DA 16,864 16,864 16,864 16,864 16,864
NCF ($) 50,333 122,079 193,825 265,571 336,664
Optimistic scenario:
Annual Treasury flow, optimist scenario
Year 1 2 3 4 5
CA 365,280 456,600 547,120 639,240 830,160
CV (27,653) (34,566) (41,471) (48,392) (96,302)
CF (112,574) (112,574) (112,574) (112,574) (112,574)
CFB 225,053 309,460 393,075 478,247 621,284
DA (16,864) (16,864) (16,864) (16,864) (16,864)
RBE 208,189 292,596 376,211 461,410 604,420
I (15%) 31,228 43,889 56,432 69,211 90,663
RN 176,961 248,707 319,779 392,199 513,757
DA 16,864 16,864 16,864 16,864 16,864
CFN ($) 193,825 265,571 302,915 409,063 530,621
Calculation of the evaluation criteria:
Pessimistic scenario:
o Net present value (NPV) is equal to the difference between the current value of this project and the initial
investment.
NPV = - Initial investment + sum of cash flow updated
NPV = - 170.000 + 50.333 / 1.09 + 122.079 /
NPV = - 170.000 + 46.177 + 102.751 + 149.668 +
NPV = 535.541
So although the analysis is done in a pessimistic scenario, we deduce that NPV> 0 hence the project is highly
profitable and much acceptable.
Our investment amount [170,000] is between 148.928 and 298.596, that is to say that the payback period on
rd
investment is between 2 and 3 years: During the 3 year→ (298,596– 148,928) let 149,668/ year, or in order to get
the Investment return we need (170,000 – 149,668) = 20,332
1yr -----→149.668
X----- ←X20.332
⇒ X = 0.13
⇒ X = 1 month17 days
Optimistic scenario:
o Net present value (NPV):
2 3 4
NPV = - 170,000 + 193,825/1.09 + 265,571/(1.09) + 302,915/(1.09) + 409,063/(1.09) +
5
530,621/(1.09) NPV = - 230000 +177,821 + 223,526 + 233,906 + 289,790 + 344,867 = 1,099,910
So the project seems very profitable taking into account the capital invested.
o profitability (IP):
IP = 1 / I × sum of discounted cash flows
2 3 4 5
IP = 1/170,000 × [193,825/1.09 + 265,571/(1.09) + 302,915/(1.09) + 409,063/(1.09) + 530,621/(1.09) ] =
1,269,910/170,000 = 7.5
As IP> 1 therefore the project is much profitable.
o return time (TR) or Payback Period:
Accumulation of current value of cash-flow (O scenario)
year 1 2 3 4 5
CFN
Current CF 193,825 265,571 302,915 409,063 530,621
CFcum ul at ed 177,82 1 223,52 6 233,90 6 289,79 0 344,86 7
1st
Our investment amount [170,000] is Returned from the 1st Year→ to reach the capital invested during the year
we need (177.821 to 170.000) = 7.821
1yr -----→ 177,821
X ←----- 7,821
⇒ X = 0.04
⇒ X = 11 months, 15 days
So TR = 11 months 15 days
Conclusion
At the end of our brief feasibility study of the foundation of a multidisciplinary physiotherapy center in northern
Lebanon, we proved that such a center is very profitable despite the average investment in equipment and
materials. In the future, the Farah-WELLNESS center can testify expansions in its services and this by introducing
other therapeutic services such hydrotherapy, thalassotherapy, care of the elderly, and others depending on the
needs and behaviors of customers.