The question
Northmere runs 46 outpatient physical therapy clinics across the Midwest. Its founder had grown it by opening in a new city every year or so, and the plan on the table was the same again: 20 new clinics across five new metros over three years. Growth had slowed to 4% a year, and the board wanted to know whether the plan would fix that or make it worse.
What we found
We built a clinic-by-clinic model from five years of visit data and matched it against every orthopedic surgeon, sports medicine practice and primary care group within a 20-minute drive. Two things stood out.
First, visits followed referrers, not population. A clinic near three busy orthopedic practices outperformed one in a bigger, wealthier suburb with none.
Second, the new-city clinics were expensive. Clinics in Northmere’s newest metros took 26 months on average to break even, against 11 months for a new clinic in a city where Northmere already had a referral team. Meanwhile, the three metros it already served held about 40% of the referrers it had never called on.
The one page
The page recommended going deeper rather than wider: open the next clinics inside the three strongest metros, close two sites that sat far from any referrer, and rebuild the referral team around surgeon practices. The page was honest about the cost. Headline growth would slow in year one while the new clinics ramped.
What happened
Northmere opened nine clinics in its three core metros over the following two years and entered no new cities. Annual revenue growth went from 4% to 11% over that period, and the average new clinic broke even in 10 months. The two closed sites’ patients were offered appointments at nearby clinics, and most moved with their therapists.
We stayed for the first 30 days to help hire the referral team lead and set up the monthly referrer report the founder still reads first.
Growth measured as same-period revenue, two years after the board approved the plan. Two of the nine clinics were already in planning before the review.
