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Operating a dental practice can be a delicate balance. Overhead costs like employee salaries, real estate costs, marketing efforts, and equipment maintenance and regular acquisitions can add up extremely quickly. Attempting to reduce dental practice overhead can be daunting, but it is possible. We’ve assembled a few of our top tips for reducing dental practice overhead, without sacrificing quality of care or patient experience.

Essentially, improvements can be made one of two ways: by increasing productivity with the resources that are already available, or by reducing expenses.

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A dental practice is a business – treat it like one.

If you want your dental practice to achieve its highest potential, it’s important to remember that while dentistry is a service to your community, a medical practice is only successful if you treat it like a business.

Review your current overhead percentages

Like any effective plan for change, the first step for reducing dental practice overhead is identifying easily quantifiable benchmarks and thoroughly reviewing the current situation. Being able to analyze specific trends will help you make more strategic business decisions in the future. These benchmarks are commonly referred to as “key performance indicators” (KPIs).

Comparing your practice’s KPIs against industry standards is one good way of setting percentage-related goals. The following percentages on overhead costs are recommended as industry standards for a maximally efficient dental practice:

Institute regular financial reviews

Monthly, quarterly and annual reviews of your current overhead costs can help you more easily perceive trends, excess expenditures, and oversights more easily. Numbers that can easily be reviewed on a regular basis include:

Evaluate the “true cost” of supplies

There are some overhead costs that will remain fixed, no matter how much you optimize time and resources. However, the cost of supplies and lab services vary according to the efficiency of your practice. Don’t forget that ultimately, the true cost of supplies includes often forgotten factors such as product returns, inventory overstock, and shipping costs.

For laboratory services, don’t forget to continuously evaluate your available options, and give regular feedback to help perfect the communication process. Switching to a larger lab network or investing in more efficient technology can make a big difference.

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Improve staff morale and patient satisfaction.

Ultimately, the people make the practice. Your employees are the most valuable part of your dental practice, and are often (fittingly) the largest expense. Be sure to invest sufficient time and energy into ensuring adequate employee satisfaction.

Employee satisfaction can make a huge difference in the success of your business, and likewise, poor employee performance can drain overhead. Take the time to communicate with staff about your goals so that they can better understand their own roles within the practice, and ask about their needs and ensure that they are being met.

Happy staff means happy customers. Administrative staff, dental hygienists, and other dental practitioners will always make a greater impression on patients than material aspects of the practice or technical efficiencies. Investing in your employees’ well-being can improve efficiency and patient satisfaction.

Reaching out to your patients with appointment reminders and check-ins can help them stay on track with their oral health. Be more than just a service provider – communicate regularly with customers to become a medical provider they can trust and rely on.

Optimize efficiency.

Optimize your hygiene department

According to data collected by the American Dental Association, working with two dental assistants increases productivity by 26.1%, and having three assistants can improve productivity up to 70%. While having adequate hygiene staff is vital, so is ensuring that your hygiene department is profitable. Hygiene pay should be around 30% of their production revenue.

Patronize a single distributor

When it comes to acquisitions, don’t make the mistake of spreading out purchases over many different distributors. When you source purchases from one main distributor, you are more valuable to each other and this will enable better communication and opportunities on both sides.

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More optimization tips:

Become an ADA member

All dental professionals want to receive the greatest possible return on their work. Just as with other businesses, receiving support and credibility through a membership association can mean a significant boost in success. With constantly-increasing competition in the field, and higher rates of educational debt, it can be invaluable to have a group to advocate on your behalf when needed.

Four out of five dentists are members of the American Dental Association, the nation’s leading dental organization. For dentists who have been practicing for between 8 to 20 years and are going through practice management issues, the ADA has an enormous wealth of information to help.

Finally, when patients are choosing a dentist, they know that ADA members have access to all the most up-to-date resources and information on modern dentistry. Importantly, the ADA verifies and certifies the legitimacy of individual dentists and practices, and offers a broad range of advocacy services aimed at benefiting dentists and their patients alike. Continuing education, testing and qualifications for licensing, and practice management tools and resources are just a few benefits of becoming an ADA member.

For more information, see Benefits of Being an ADA Member.

Join here:

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