Looking to Expand? What to Consider First
At the beginning of their careers, many dentists dream of one day owning a larger, highly successful practice complete with multiple operatories and the most high-tech equipment available. They can envision themselves happily treating patients in this beautiful space and can’t wait to make this vision a reality.
That’s a great goal, but if you’re one of those dentists with dreams of expanding, it could all turn into a nightmare if you’re not careful.
These large, high-tech practices enable you to provide top-notch care while also attracting more patients, but they also come with serious overhead headaches. Don’t worry, I’m not here to crush your dreams. A large practice isn’t out of reach; a little pre-planning will go a long way in ensuring your move to a larger practice is successful. Here are a few tips.
Put a Plan in Place
Industry overhead standard: 55% of collections
Determining your Numbers
Now let’s look at payroll. At 20% of collections, your staff overhead budget should be $20,000 a month. If your math puts you above that benchmark, you’ll want to make some changes before getting to that larger practice. That could include looking at the way you handle raises and finding ways to make your current team more efficient before you hire anyone new.
Here’s a look at different ways to get that number down:
- Work more days. While this might seem like a good idea, working extra days doesn’t necessarily mean you’ll have higher production. You still need patients in the chair.
- Increase fees. If it’s been a while since you’ve made fee adjustments, this could be a viable option. Just do your research and make sure you don’t become the most expensive dentist in town.
- Lease two of your operatories to specialists. While this could help keep overhead down, it isn’t a setup you should enter into lightly. Adding specialists enables you to offer more treatment in-house, which could attract more patients, but these arrangements also involve other logistics and concerns such as legal agreements.
- Reduce the number of employees. Of course you want to avoid this if you can, especially if you’re preparing for growth in the new practice. With that said, make sure you’re scheduling properly and don’t have too many clinical people on staff.
- Increase production. This is the best way to grow your practice and boost your revenues.
And like I mentioned before, market to patients both internally and externally. Let current patients know you’re expanding your practice and educate them about any new services you’re providing, whether you spread your message with posters in your waiting area, through an e-newsletter or simply by talking with patients while they’re at the practice. Find ways to reach out to potential new patients to get them excited as well. Determine which options work best in your area. If you’re not comfortable with this, don’t be afraid to reach out to dental marketing experts for help.
Whether you’re ready to expand your space or want to move to a larger practice, it’s important to put a plan in place first. Work out the numbers so you don’t run the risk of your overhead costs skyrocketing out of control. Determine where you are and where you need to be, then start making the necessary changes and you’ll be much more successful in your new space.
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