Apollo Clinic could be a great opportunity for you to be a part of a bold and historic chapter in Indian healthcare. As you will realize, the project is an extremely attractive investment proposition. Apollo Clinic will have consultation services like General Medicine, Gynaecology, Paediatrics and Cardiology through a team of full-time physicians and visiting consultants available for General Surgery, Dentistry, Gastroenterology, Urology, Dermatology, and Orthopedics along with counselling services in areas like Diet and Nutrition along with Hospital Information Centre and lab being operated by AHLL
Each Apollo Clinic has an area requirement of 4000 sq. ft. carpet space and a Project Cost of Rs 2.5 – 2.75 Cr. The Project cost includes investment in Medical Equipment, Interiors and Furniture, Civil Modification, Air Conditioning, Electrical , Information technology (Hardware and Software), Lease Deposit ( if the premises are taken on rent), Preliminary and Pre-operative expenses, Working Capital Margin, Contingency Funds and License Fees to Apollo. The project is ideally funded on a 1:1 Debt Equity ratio. The debt has been taken for a period of Four years with a one-year moratorium on principal payment. Adequate amounts have been budgeted for infusion of fresh capital into the project over a period of Five years, for which duration the projections have been made. Apollo Health and Lifestyle has also tied up with State Bank of India (rate of interest 12%-15%) for project funding.
Q. What are the revenue streams in a Clinic? And what is the overall profitability?
The Clinic will derive its income broadly from the following services: Consultation including counseling services Diagnostic Services Preventive Health Check Programs Dental Services Treatment room Others (Telemedicine, doctor @home, referrals etc) The Clinic is expected to generate revenue through all of the above sources. It is also expected that there will be a large degree of cross-referrals between various revenue generating streams. In the first year of operation, the Clinic in India can expect to generate between Rs. 15 million to Rs. 20 million, depending upon the facilities that are provided.
Q. What does Apollo Health and Lifestyle Limited charge as fees?
AHLL charges an ‘Initial License Fee’ at the time of signing the Agreement . This license is valid for a period of Five (5) years, which is the tenure of the License Agreement. As royalty fee, AHLL will charge a percentage of the gross
turnover of the clinic , which will be payable on a monthly basis.
Q. Will AHLL or AHEL make investment (even a token amount) in these Clinics?
Since the chain of Apollo Clinic is being set up on a franchise basis, the franchisee will be responsible for the entire investment. Where requested, AHLL will assist the franchisee in arranging term loan from a bank. However, neither AHEL nor AHLL will not make any investment in the clinic. It will also not give any guarantee to the lender.
Q. What will be the relationship between existing Apollo hospitals, Apollo Clinic?
While every Apollo Clinic will be an independent entity, both the entities will benefit from the common brand building and similar exercises. Also, the Clinic can benefit from being able to refer customers for high end diagnostics as well as tertiary or in-patient care to the Apollo Hospitals. At the same time, the Clinic will gain from referral income while retaining the customer. The goodwill of all these facilities shall automatically come to you through Apollo brand name. Specific association with any or all of these entities, shall be based on local market conditions and business needs.
Q. If an Apollo clinic is set up in a city where a full-fledged Apollo hospital already exists, will it not mean unnecessary competition within the same organization?
Apollo Clinic shall focus on primary healthcare. We do not perceive any competition from the existing Apollo facilities which are mostly secondary and tertiary care facilities. Secondly, no two Apollo facilities would be operating in the same territory as any other Apollo facility. In fact, such facilities would create synergy in terms of referrals.
Q. What will be the name of the Clinic? Can the name be altered or modified?
Every clinic will be called “Apollo Clinic”. No deviations are allowed. The name and signage has been standardized and no deviation, beyond AHLL’s stated guidelines, will be permissible.
Q. What is the growth plan for the Clinic? Can I ever own an Apollo franchised hospital?
Currently our focus is on primary healthcare as it is an area with tremendous unexplored and unutilized potential. The growth of clinics is envisaged in terms of geographical expansion or/ and sub-franchising as also through introduction of additional facilities like CT Scan, dentistry etc. However, we cannot rule out the possibility of setting up hospitals at a later stage with the Apollo Group.
Q. How are the physicians going to be associated with the Clinic?
The Clinic will have a Consultant General Medicine, Pediatrician, Gynecologist and a Cardiologist. These physicians will form the core team, but besides the Consultant General Medicine, all other specialty doctor will not normally be on the full time rolls of the Clinic. Apart from them, the Clinic will have a group of visiting consultants from various disciplines like General Surgery, Orthopedics, Endocrinology, Urology etc. The Clinic will also have a Radiologist and a Pathologist on its full time roll. The hours of employment may however be decided based on the local conditions. The Consultant General Medicine will take care of the preventive Health Checks programs too. All other doctors will be consultants.
Q. How would doctors and technical staff be recruited? What will be AHLL role in this?
The method of employment of doctors would vary from city to city. AHLL will assess the financial implications on the business and recommend full time employment, revenue sharing based association or any other method that is considered appropriate. Good technical staff is adequately available in the market. AHLL shall help in recruiting such all key staff by designing advertisements, conducting interviews, and short listing.
Q. What would be the profile of a typical Clinic Manager?
The professional manager should preferably be an MHA with excellent managerial skills, marketing acumen and a flair for customer relationship management. He would have about 7-8 years of work experience, preferably in a primary healthcare facility. Doctors in administration may also fit the profile.
Q. How many people do I need to employ to run the Clinic operations?
Typically staffing requirements in India vary between 20 to 25. Actual staffing could vary depending on a number of variables including the number of facilities set up and the number of floors occupied by the Clinic.
Q. Are the locations for opening an Apollo clinic restricted? Can the clinics be set up anywhere in India or abroad?
AHLL has prioritized certain cities based on Market Surveys conducted for the establishment of new clinics. Some of these cities are being considered for implementation in the first phase itself. Other cities shall be covered in the second and third phase.
Q. What are preventive health-checks and how important are they?
Preventive health-checks are checks performed on individuals to determine the stat of their health by carrying out a series of diagnostic tests. Preventive healthcare is catching up in bigger towns and cities. There is already a lot of corporate business in this area. We intend to popularize the maxim of “Prevention is better than cure” through our marketing programs. Very soon, with the entry of private insurance companies, preventive health checks will become a norm. Insurance companies would certainly prefer paying for pre-insurance health checks than settling large hospitalization bills. Secondly, while allotting an insurance policy to anybody, insurance companies would rather have an institution like Apollo certifying the health of a prospective customer as against an individual.