No matter what Dr. Dentist - your time has to be your greatest resource
Updated: May 18, 2018
Your greatest resource to the earning power of your Practice and business is your time.
I know there will be pitchforks and flaming torches at dawn in certain quarters when you read this, but hey - it's just my opinion and you can think I'm a rotter if you so wish - that's life! I speak here with regards the time of Dr. Private Dentist, not Hygienists/Therapists... yet. Anyway... Moving swiftly on:
In any service based business (yes, you are service based Dr. Dentist) the greatest assets you have are your expertise, clinical expertise in this instance - they are not to be found at the drop of a hat or in Boots on the high street, there is no quick fix to Oral Health issues and prevention, we know this and that is a fact.
However your greatest resource to the earning power of your Practice and business is your time. Expert diagnosis, advice, treatment planning, consent writing and any actual treatment takes time, and 'expert time' - does not come for free, period. For example, when you get your cars service and MOT bill from your mechanic, you pay for the MOT, any parts required and then labour - or using another word - time. Do you find that this approach from your mechanic is unreasonable? No...? I Thought not.
This basic concept is the same in any service based industry where specific amounts of 'time' are required to complete a job (i.e. via specific appointment slots), whether it be an MOT... or a root canal treatment. Let's start with free appointments.
Giving free appointments to new patients (NP) (and anyone who reads anything I write will already know of my opinion here...), is a complete and utter waste of you and your teams time, that is (also) a fact. Please do not do this, is there any point of seeing 35 NP a month on free appointments, 75-90% of which are tyre kickers or fail to attend? There is no point, I can assure you. Why not charge a fee for different types of new patient assessment e.g. £100 for a standard NP and £195 for an Orthodontic assessment? (You can assess what price to charge from a simple measure on your KPI's incidentally...) Your conversion rates will increase instantly as the people who take you up on these appointments, are without exception more serious about taking up the treatments you recommend - there does need to be some defined NP procedures put in place to support this approach, but that's a story for another day...
Anyway, moving on... if you have a decent accountant and embrace cloud based accounting systems, such as Zero, FreeAgent etc (which of course you all do....), which combined give you quarterly management accounts, this will include a specific number, detailing how much it costs you to run your Practice each day, including what you want to take out of the business as earnings via dividend etc. Subsequent to this, will be a number of now much you need to earn each day (in cold hard cash) to meet these expectations. This is the number you are after - this is the golden measure and (in my humble opinion) is what you should base your target hourly rate around.
Target hourly rate then...
I can positively feel you all bulking at even discussing this, but like shaving - it's something we don't like, but must face on a daily basis!
Simple sum time (by random example):
Required income per day to meet revenue needs = £2,000 (finger in the wind number FYI...let's go on a simple Practice with 1 Dentist and 1 Hygienist each day),
7 working hours per clinician per day - 14 hours,
£2,000, divided by 14 hours = £142.85 per hour.
So there it is - your services need to generate, on average £142.85 per hour.
Have you ever considered this number? If not you absolutely should, as this is the main factor behind deciding what your fees should be - NOT what Dr. Bloggs down the road is doing - that is largely irrelevant.
Plan income can help soften this blow immensely - if you have well maintained, loyal and monthly paying patients, this number can quite often be reduced dramatically. If you have 20K dropping into your bank every month, this will ease the pain a great deal! Focus on being prevention led and health based - promoting the monthly payable plans as the best option at all times - you need to SELL it, but that's another conversation for another day.
So in summation, sit down and crunch some numbers, work out how much it costs you to run your business and get the right type of patients, paying the right fees, with prevention at the centre of everything that your Practice stands for... You never know, you may even be able to have 6 weeks holiday a year and retire at 55!
Practice Exchange is a comprehensive database of all courses relating to dentistry. The Practice Exchange database is available to you anytime, anywhere. Free of charge. No registration. If you are a course provider, please submit your course to our database for free. This will allow dental professionals to find you easily.
We also run a FREE busy job board for all jobs in the dental profession. If you are a Dentist, Hygienist, Dental Nurse, Practice Manager, Receptionist or an Orthodontist, this is where you will find your next job. It's our responsibility to drive traffic to your posting and ensure as many people as possible are aware of your opportunity.