Many practice owners believe they need more patients, more marketing, or more hours in the day. Often, the growth they’re chasing is already sitting inside the business, hidden by numbers they aren’t watching.
Brittany McMahon, an operations consultant at Diamond, has spent 15 years looking underneath top-line revenue for practice and med spa owners. Her message: “Remember, you can’t grow what you can’t see, and you cannot strategically scale what you don’t understand.”
Her framework comes down to three numbers that answer three questions:
- Profitability: What is actually profitable?
- Performance: What is actually performing?
- Return: What is actually worth scaling?
Profitability: Where Are You Making Money?
Two practices can both generate $2 million a year. At a 10% EBITDA margin, one keeps about $200,000. At 25%, the other keeps $500,000, a $300,000 difference. The question to ask is, “Where am I making money, and where am I giving it away?”
To find the answer, look beyond the practice-level number:
- Margins by service category (injectables, lasers, wellness, retail)
- Margins on individual treatments
- The drivers behind those margins: cost of goods, pricing, compensation models, discounting, packaging, and product utilization and waste
Your top revenue generator may not be your top profit generator. A treatment producing $50,000 a month at a 30% margin earns $15,000, while one producing $30,000 at a 60% margin earns $18,000. Small percentages add up, too. On $2 million in revenue, every point of margin is worth $20,000.
Example: The $50,000 Treatment Category That Wasn’t a Winner
One of Brittany’s clients had a treatment category generating about $50,000 every month. The owner wanted to promote it, push it, and incentivize the team to sell more. When Brittany asked what it cost to generate that revenue, the owner couldn’t say.
Underneath, cost of goods sat around 40% of revenue. That meant $20,000 of the $50,000 was consumed before providers or operating expenses were paid.
Working together, they tightened inventory controls, reviewed pricing structures, changed the membership model, and focused on evaluating purchase pricing and negotiating vendor contracts. Cost of goods fell from 40% to 22%. Applied across the practice’s $2 million in annual revenue, that’s $800,000 versus $440,000, or $360,000 in added profit with no extra marketing spend or hours.
As Brittany puts it, “sometimes the fastest path to growth, it’s not generating more revenue, it’s not dumping more money into your marketing bucket, it’s truly understanding and improving the economics of the revenue that you’re already generating.”
Performance: Diagnose With KPIs
Your P&L tells you what happened. Your KPIs tell you why. A 15% revenue drop is an outcome, not a diagnosis. Brittany’s advice: “Diagnose before you prescribe, because somewhere underneath that revenue decline, there’s a number that moved.” In her example, lead volume and consultations were stable, but consultation conversion had fallen from 70% to 45%.
You don’t need 100 KPIs. Focus on the ones tied directly to revenue:
- Lead conversion and consult conversion
- Provider utilization and revenue per hour
- Rebooking and retention
- Average patient spend and retail sales
Tracking isn’t enough. KPI accountability means every important number has a target and an owner. If the consult conversion target is 70% and a provider is at 45%, that’s a 25-point performance gap to address in one-on-ones, coaching, and training. As Brittany says, “a KPI just sitting on a dashboard isn’t data.”
Example: The “Marketing Problem” That Was a Conversion Problem
Another owner was sure she needed more leads. But marketing was doing its job: leads were coming in, consultations were booked, and patients were showing up. Consultation conversion, however, was 36%. Of every 100 consultations, 64 walked away.
Brittany worked directly with the practice’s team, and together they restructured how consultations were run. Instead of information sessions, consultations became structured conversations built around diagnosing needs, treatment planning, education, and overcoming price objections. In four months, conversion rose from 36% to 68%.
At an average patient spend of $1,500, those 32 extra patients per 100 consultations equal $48,000 in additional revenue, with the same lead volume and the same marketing investment. Brittany explains: “Because marketing’s job is to create that opportunity, but it’s your operations that determine what happens next to that opportunity once it walks through your door.”
Return: Know What Your Spending Produces
Asking what you spent isn’t enough. You need to know what the spend produced. If an agency says it generated 300 leads for $10,000, Brittany’s response is, “That’s activity, but it’s not ROI.” Follow those leads financially: how many were contacted, booked, showed up, and converted, what it cost to deliver those services, what margin they produced, and whether the patients came back.
Apply the same discipline to devices, employees, software, promotions, memberships, and even operating hours. Before buying a $100,000 device, build a business case that covers:
- Acquisition cost and financing structure
- Consumable cost per treatment
- Provider labor to deliver it
- Realistic market price and contribution margin
- Existing patient demand
Then weigh the alternatives, because “capital has an opportunity cost.” And “just hearing everyone has one isn’t a business case.”
How to Know When You’re Ready to Scale
Brittany is direct: “growth and scalability, they’re not the same thing.” Before scaling anything, confirm three things:
- It’s profitable. Check cost of goods and contribution margins.
- It’s repeatable. Remember that “there’s a very big difference between a spike and a trend.”
- The return is attractive. The investment, whether marketing, equipment, or training, must be worth what it produces.
How Often Should You Review Your Numbers?
- Weekly: Team KPIs you can influence right away, such as lead and consult conversion, rebooking, and provider utilization
- Monthly: Your P&L, including revenue, cost of goods, payroll, marketing spend, operating expenses, profit margins, and EBITDA
- Quarterly: Trends in margins, productivity, and investment returns
The goal, according to Brittany, is not to look at numbers for their own sake: “the purpose of reviewing data isn’t just to admire a dashboard, it’s truly identifying a variance early enough to do something about it.”
The Bottom Line
When revenue drops, look at performance. When revenue rises, look at profitability. When marketing produces leads, look at return. Brittany’s one takeaway: “stop using revenue as your only measurement of success.”
Ready to See What Your Numbers Are Telling You?
If you can’t say with confidence which treatments make you money, where your team is underperforming, or what your investments return, you’re operating blindly. Diamond works with practice and med spa owners on the financial and operational side of their business, helping them understand their numbers and scale strategically.
