Advertisements

Toenail Fungus, Groupon and Lessons in Excess Capacity

I want to begin this blog on a deeply personal note.  YES I suffer from Toenail Fungus.  As I try to keep you the reader informed it is necessary to unveil my bias and show the different motivations that go into considerations for a blog post.  So how do these three seemingly odd bed fellows converge into a teachable moment?  Let’s take a quick look at the economic principles and structures in play.

 

For those of you not familiar with the dreaded Toenail Fungus (consider your phalanges blessed), you acquire the fungus usually in locker rooms or communal showers.  However, painted toe nails, unclean socks or hosiery and shoes that create sweaty foot conditions can create an inviting environment.  The fungus is a chronic condition that is not painful and usually goes untreated.  Oral medication can be taken but the risk of serious side effects including death is present.  Most people who have the fungus just live with it.

 

But now thanks to Daily Deal sites like Groupon, we can say good-bye to the Fungus.  As indicated by this link: http://www.groupon.com/deals/north-shore-foot-and-ankle obviously there are a lot of  fungus suffers who want relief.

 

Finally Podiatrists and clinics that provide the laser Toenail Fungus removal have to make a large capital investment to acquire the suitable equipment to make sure your toes are fungus free.   Now its time to put these elements to work and establish some basic assumptions that are valid in light of the current economic climate.

 

1.  There are a lot of people who have the Toenail Fungus that choose to forgo or were treated ineffectively with oral medication.  Therefore you already have a pool of patients (1.26 billion dollars per year are spent on topical treatment as well) who want a safe medical solution to their problem.

 

2.  Groupon reaches a large audience and delivers coupons reducing the cost of goods and services.  Nothing Groupon does is proprietary however they are the current market leader as they deliver thousands of offers everyday to people all around the globe via e-mail, apps and similar mobile communication.  Groupon’s innovation has come in the delivery system of discounts and coupons.

3.  Podiatrists and medical clinics that offer the Toenail Fungus treatment have spent considerable investment capital in the equipment and need to recoup this money to mitigate cash flow.  In addition if the providers have excess capacity, they are getting value out of their machine, albeit at a reduced rate.  The biggest challenge with reducing the price for treatment is denigrating the integrity of the price.  However with the competition robust, the price for the treatment has drastically come down as the providers recoup their capital. (this was mentioned to me by my podiatrist during my last visit as he tried to sell me on the procedure).

So what can we actually learn from these assumptions:

1.  If you are an entrepreneur and a service provider with excess capacity, consider Groupon as a way to monetize your otherwise “un-booked” time.

2.  If you are afflicted with Toenail Fungus, there is a reason to be excited as you watch treatment options drop in price and increase in effectiveness.

3.  Finally the hardest question is how to mitigate cash flow after investing in capital-intensive equipment for your business?  The answer as shown by this Groupon deal  is to make sure you maximize your revenue from your assets even at a discounted rate.  However be careful about the potential effects this could have on the future integrity of the price for your service.

 

Until next time study depreciation and monetize your efforts to the best of your ability.

Until next time, be good and cultivate your community of friends.

Advertisements

2 responses

  1. Very interesting info!Perfect just what I was looking for!

  2. Very good post! We will be linking to this great content on our website.
    Keep up the great writing.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: