“I seem to be working longer and longer hours, but my receivables just don’t show it, and my overhead feels out of control. What am I doing wrong?”
If this sounds familiar to you, and is descriptive of your dental practice, you’re not alone. Many dentists, while excellent Clinicians, would rather bury their head in the sand and cross their fingers – now, there’s a visual! – when it comes to managing their finances. Their mantra: “I just want to do dentistry!”
Help is at hand, and probably closer than you think, but as with any problem, it must be acknowledged before it can be remedied. With that in mind, the following is a list of 6 ways your practice is probably losing money, and how you can go about putting effective and long-term fixes in place. We talked to a number of our respected colleagues in the dental practice management community to compile this list, which means you are getting the knowledge, experience and advice of some of the most successful dental professionals in the industry. They’ve seen it all, and know how to fix it, too.
Way#1: Lack of an annual plan
Ask most dental consultants the reaction they get from their dental clients when discussing an annual plan and they’ll tell you it’s along the lines of… “Ugh, really? Do I have to?”
Yes, you do. If you don’t you’re losing lots and lots and lots of money because you have no financial road map in place for your practice, and are therefore at the mercy of last-minute, unplanned and poorly thought out financial decisions.
In their e-book, “Take Control of Your Overhead (In 7 Easy Steps)”, veteran dental consultants Virginia Moore and Debbie Castagna put it this way:
Who's in control - you or your overhead? An annual plan shows you how to use hard numbers to put a plan in place for greater success and profitability. These plans include proven, tested advice on establishing achievable production goals, controlling practice overhead, including forecasting and goal-setting, determining work days and doctor production goals, establishing hygiene production goals. In other words, they say, “take the guesswork out of your numbers, and finally achieve the financial stability and predictability you desire.”
Way #2: Poor hiring policies
Does your practice have a plan in place for finding and retaining top talent? If not, you’re losing money every time a new hire leaves unexpectedly, or even worse, stays and is not productive. Dental consultant Jan Keller says that while estimates vary, no matter what statistic you use, employee turnover is costly, often more than 100% of that individual’s total compensation.
Keller advises her clients to use a ‘forensic’ technique with new hires. In other words, she says, put them under a microscope before you hire them and make sure they’re a good fit for your practice. This may take a little longer, she says, but it will help you avoid the knee-jerk “we just need someone now” syndrome, and find and retain the top talent your practice needs.
Way #3: “I’m Too Nice” Dentistry
“Doctor, do you guarantee your work?”
It’s a question you and your staff have probably heard on many occasions, and one that can be difficult, even awkward, to answer. Most patients aren’t questioning the quality of your dentistry, they just want to know what happens if they accidentally drop their bridge and step on it, or chip a new crown while dining out.
If you’ve ever replaced or repaired dentistry when you knew the problem wasn't your fault at all, you were doing "I'm Too Nice" Dentistry. Can you imagine a medical doctor ever redoing medical procedures for free, not to mention when the problem was the patient's fault? The good news is that you don’t ever have to do that again.
With Dental Warranty, patients pay a very reasonable Dental Warranty fee at the time the dentistry is completed. Both you and the patient walk away with greater peace-of-mind knowing neither one of you will lose out if accidents happen and further work is required. Even better, in order for the warranty to be valid, the patient must return for hygiene every 6 months. That’s patient retention for you, and good oral healthcare habit building for your patient! Did you know that nationwide an average of 4 out of 10 patients purchase Dental Warranty coverage with top practices seeing as high as 8 or 9 out of every 10 patients covered? It’s truly a winning proposition for all.
Way #4: Ignoring the ‘hidden treasure’ in your patient charts
Are you ignoring a revenue source that is quite literally in front of your nose? The truth is that many practices lose tens of thousands of dollars every year because they don't put a recare program in place that identifies patients who have delayed treatment, and then put a system in place to monitor them. Once again our colleague Jan Keller has excellent advice: “Don’t ignore the “hidden treasure” in your patient charts,” she says. “If your practice has unfilled chair time, this is an easy – and rewarding – process to put in place”.
Way #5: A poorly trained front desk person
A good front desk person can make or break a practice. So much so, in fact, we just wrote an entire blog post on this topic. If your front desk person is not the right person for the job, you’re losing money in a multitude of ways, none more so than from patients who leave, or never come in at all, because they perceive a lack of interest or respect from the person who answers your phone, or greets them when they arrive. Finding the perfect front desk person may not be easy, but it’s vital to the long-term success and profitability of your practice.
Way #6: A lackluster website and social media presence
When was the last time you updated, or even looked at, your website? Do you have an active and appropriate presence on social media? Like it or not, you must have a professional website that is actively updated, and you should have a social media presence, at the least a Facebook business page.
Our colleague Jill Townsend, a professional copywriter who works with many dentists and dental consultants, says the most common issue she deals with on a regular basis are websites that look and feel outdated, or are little more than a one-page ad.
“I get it,” she says. “Technology changes so fast it’s hard even for professionals to keep up with what I call The World According to Google.” But it’s also vital that you make the effort. Good websites are very affordable these days, and are designed to make updating easy, as well as including other features that help you stay in Google’s good graces, e.g. mobile-friendliness.
Townsend also encourages her clients to make sure their About the Doctor and About the Team pages are current, with professional bios and photos. Research shows these are the #1 and #2 pages visitors look at first when they come to your site. “Don’t disappoint them,” she cautions. “New patients are looking for you, and they’re looking online. Without a good website to attract them, you’re losing out not only on thousands of dollars in revenue every year, but on the value of a lifetime customer.”
So there you have it, 6 ways your practice is losing money, and easy fixes to put in place. You don’t have to do them all at once, but make a plan – there’s that word again! – to start today. You’ll be glad you did.