I have long taught that business of any kind, shape or size boils down to these two concepts.
Psychology of influencing people to do things that lead to the accomplishment of their goals and yours…and the right value exchange of money to make the math work in order to provide you with the financial objectives worthy of your sacrifice to achieve it.
You can’t have a viable long-term business if you have bad math.
In dentistry, this happens all the time.
You get too busy to make any money. See more patients, even do more production, but yet and still see shrinking profits.
This is because not all production dollars are created equal.
Idiots, liars and (I would go so far as to say) charlatans in the industry preach the idea that ‘more is better’, market to everyone, see all the patients, discount dentistry and beat ‘em with the size of your practice.
Stupid.
If you want to be Wal-Mart, you darn sure shouldn’t have picked dentistry to do it in.
What happens is really quite simple, you want to see more patients so you start mass marketing, wasting money, filling up your practice; then you realize that you have so many patients you need more people; then you have so many people you need a bigger practice; then you have so many patients you realize that most of them aren’t paying you; then you realize the insurance company is taking more and more of your fees off the top because you are doing basic dentistry.
And that leads to diminishing profits.
What no one tells you is that to run a high-volume, clinic-style practice your profit margins will be slim, unavoidably, unless you focus on GETTING MORE DENTISTRY PER PATIENT – which means you can’t be so busy you don’t spend any time diagnosing, following-up and making it an amazing experience.
Then you get desperate and you start cheapening your experience, your supplies, you price shop, exactly what you wish your patients didn’t do…then you have to cut overhead and then you start turning people away and eventually you can’t turn as many production dollars as you need to, to support your very stupid, terrible, not logical and unhealthy math problem of the dental practice business you’ve built.
Sorry to paint a bleak picture. I know this doesn’t relate to any of you because you haven’t fallen into the trap of volume over value.
You see, success is how much you keep…not how hard you work to produce it…is the quality of your life…not just how big your practice can get.
Congratulations for being an evolved human being.
I have many large practices who do amazing dentistry with complete comprehensive care and they make it work because they are enterprises run like businesses without sacrificing clinic principles, but these are not the norm.
The norm is bad math destroys your profit and you don’t notice it until it’s way too late. By then, you have dug yourself a big hole and lost your identity, mission, and passion for the dentistry you love.
Good math is really quite simple. Every day needs to be profitable, every patient visit needs to be bringing you closer to your goals, every team member needs to be accountable, engaged, involved in contributing to the growth of your practice.
You must know what your goals are, how much overhead you have, what your debt load is, how much you want to have for your lifestyle, your team incentives and bonuses, and then how much you want to have savable, investable, usable for your long term future, nest egg, other interests.
Then you have your target number divided into your clinical days and production income streams and each individual team member. This gives you the math problem you must solve profitably every single hour of every single day.
If your math doesn’t work down to the details, it’s not going to work in the big picture either.
Most dentists know historical numbers from printed reports through their software systems…or bookkeepers…that’s about it. They don’t really know the MATH of the dental practice businesses they are living with day in and day out.
As for Psychology, well, there is so much to talk about here.
Patients.
Team Members.
Referrals.
Treatment Planning.
Closing Cases.
Leadership.
A much longer conversation…let’s have it next week.
As for the Math of your Practice – I wouldn’t go to sleep again until you have it figured out, why it is what it is, what you want it to be, and how to make it happen.
Needless to say, this is exactly and I do mean exactly the point of my “Custom Profit Blueprint” Strategy Calls that I provide to select Dentists who are serious about cracking the code to the practice vision they have and making the money math work for them.
You can request my direct advice and guidance by going here…
And why wouldn’t you? I am the best in the world at Dental Business Math and until you master this, you can’t live up to your potential or make what you deserve and aspire to achieve.
What number has always be elusive to you? In your heart of hearts that you’ve dreamed to achieve in growth or income, I don’t care…
Challenge me. One phone call, if I can’t solve your problems and layout the proper dental practice business math strategy and model for you, I’ll put my money where my mouth is. Say $500, to make it worth your time.
Go ahead. It’s playoff season…Super Bowl in just one week…let’s go big or go home. What are you playing for? I’m sure, you’d agree, not enough!
I’ll fix that – on our Custom Profit Blueprint Strategy Call – go there, do it now!
