Successful Projects Start With a Well Thought Out Plan
🚀 Capacity Planning for Healthcare Development Projects 🏥
A successful healthcare development project always starts with a sound business plan that clearly defines a project’s success, the underlying risk factors, and the investment of capital and human resources that are required to get the project off the ground. There are several components of a business plan that are particularly important for helping shape a facility plan. The first of which is capacity planning.
📈 Volume Projections: An essential and critical driver of facility capacity planning that ultimately determines the overall size and scope of a healthcare facility. Most often, a new facility project is intended to support the growth of an existing service or the establishment of a new service. There are many factors that help shape the projections such as:
- the unmet need in a particular service area
- physician recruitment and utilization
- market demographic trends
- consumer preferences
- technology and medical advances
While we would expect volume projections to be a precise science, we know from experience that the actual performance can vary widely for a variety reasons. Building it too small risks outgrowing the facility within a matter of a few years. Conversely, building it too large and you risk carrying excessive fixed overhead costs without the necessary supporting revenue.
📐Recommendations for Sizing Facilities:
- Apply Efficient Practices: Utilize efficient operational and best practices for future state planning, rather than relying on current methods. We often find that the design process is delegated to user groups that may have limited experience outside their current facility, leading to carrying forward workarounds or misplaced assumptions that leads to more capacity as the solution rather addressing the underlying operational issues.
- Avoid Unnecessary Shelled Spaces: Only build shelled spaces if there is solid data that the additional capacity will be needed within the next 2 or 3 years. While there are some advantages of constructing shelled spaces for economies of scale and speed to market when the additional capacity is needed, unutilized spaces that do not generate revenue can create a drag on operational performance and affect overall project viability.
- Plan for Horizontal Expansion: Where possible, design and plan your facility so that you can construct a building expansion when the volumes justify a program expansion.
- Think Like a Retailer: When contemplating future growth, consider new locations in an adjacent market that allow you to further expand your market share. Seldom do we see traditional retailers adding to an existing facility, instead they see growth as a launching pad for a new location that allows them to draw an expanded customer base.
Stay tuned for expert advice from a team that has been developing healthcare real estate for 40+ years. Contact us for an informal conversation about how we can partner to meet your needs and make your life easier, reach us at mcmarketing@medcraft.com
