June 23, 2023

Tips for Running a Successful Dental Practice

It’s one thing to start a dental practice from scratch or buy an existing one, but it becomes an entirely different game when it comes to turning the practice into a successful business that can stand the test of time. It can feel overwhelming to understand all the ins and outs of what goes into a successful dental practice while still focusing on the clinical reasons you got into dentistry in the first place.

During your tenure as a dental entrepreneur, you may have asked yourself:

  • How do I run an efficient dental practice?
  • How profitable is a dental practice?
  •  What is a successful dental practice?
  • How can I make my dental office more productive?
  •  What is the best leadership style in a dental office?
  •  What are the qualities of a good dental clinic?
  •  How do I manage my dental business?

The experts at Professional Transition Strategies (PTS) can help you answer these questions and more with the following ideas to improve, promote and manage your dental practice. Here’s how.

Find a starting point

Running a successful dental practice is a combination of industry and business knowledge — you can’t have one without the other. Even if you’ve been established for decades, changing and adapting to the times is an essential part of the process. That’s why you’ll want to have a reputable dental practice broker in your back pocket as part of your team of advisors.
The experts at PTS will help you with decisions to meet your short- and long-term goals, such as how to:

  • Engage your employees by embracing office culture
  •   Expand and train your dental team (use a simple formula, like this one from Planet DDS)
  •  Adopt user-friendly scheduling and automate your billing process
  •  Provide flexible dental financing options
  • Invest in equipment and technology

Minimize debt

As part of your efforts to keep your eyes on the bottom line, you’ll want to minimize your debt from dental practice loans when and where you can. One way is to take stock of your equipment and only invest when there is a need and desire. This includes everything from good patient chairs and practice management software to a digital impression system and crown mill.

Another way to minimize your debt is by employing various strategies for any leasehold improvements. This could mean exploring a space-sharing opportunity with other medical professionals[1] or dental specialists or even keeping your office design simple and only upgrading once cash flow allows.

When it comes to decreasing debt, the experts at PTS bring years of experience in lowering dental practice overhead and increasing supply chain efficiency to ensure maximum profitability.

Establish (and reestablish) goals

It’s never too late to step back and envision how you want your dental practice to run. Maybe your goals were more vague when you first started practicing, but now is the time to be specific about the future of your business, especially when it comes time to eventually transition ownership. The goals should not only be actionable, but also achievable, according to Dental Claim Support.

Ask yourself:

  • What are your production goals and cash flow projection?
  • Are you able to service your debt?
  • Do you want to keep practicing general dentistry, or do you want to partner with an in-house specialist?
  • Are the current number of operatories meeting your needs?
  • What staffing changes could you make to keep everyone happy and motivated?

The best way to understand the financial health of your business is by working with a qualified dental practice broker even before considering a transition of ownership. PTS offers a free valuation to get the process started for dental entrepreneurs looking to make a change within their practice, such as bringing on a partner, selling or affiliating with a group.

Reconsider location

What worked when you first opened your doors might not suit the needs of your current patients. Even if you feel established, you might be missing the chance to reach a new demographic to put you ahead of your competition. For instance, if you are a fee-for-service (FFS) practice only or want to get into high-end cosmetic dentistry, you’ll want to be located in an affluent area. Or, if you are a pediatric dentist, you might want to consider a location that is currently expanding. What unique value proposition do you want to bring to a new area?

Yes, lease numbers are important, but be sure to take all factors into consideration if considering relocating your dental practice, including:

  • Is the location centralized and easily accessible for your patients, near major intersections or busy streets?
  •  Does the office have good visibility with outdoor signage to attract passersby?
  • Is the building accessible for all your patients, with off-street parking and a handicap ramp?
  •  Are there other practices similar to yours in the area? Is there a referral base?

Reevaluate your business plan

Chances are, you established a business plan when you were in the process of starting up your business and approaching lenders. Do the goals you set for yourself still apply today? What steps do you need to take to move your business forward? How does your business plan fit into your life plan?

Remember, the blueprint for how your dental practice will continue to be successful includes:

  •  Lending plans
  • Growth strategy
  •  Profit and loss projections
  •  Demographics strategy
  •  Mission statement
  •   Vision statement
  • Plan for hiring both administrative and clinical staff
  •  Marketing plan

It’s easy to get comfortable with the dental practice you’ve established, but if you want to grow both in and out of your business, you’ll want to do so strategically. PTS can help make sure you’re on the right path.

Market your business

Marketing is essential for your dental practice, no matter what stage you’re in. Not only does it bring in new patients, but it can also strengthen the relationships you have with existing patients. But in a competitive environment, it can feel like bigger dental practices have bottomless marketing budgets. In the first three to five years of practice, you’ll want to devote 5% to 7% of collections to marketing. This includes personalized and online efforts, such as building a user-friendly website with a social media presence. Dr. Michael Long, DDS, even recommends making special merchandise with your dental practice’s name on it and distributing it among your patients “to enhance recall.”

An experienced dental practice broker, such as PTS, can provide guidance on this and other ways to maintain attrition rates.

Enlist help

Because PTS works closely with hundreds of medical and dental practices, we see what the top-performing offices are doing to be successful and can offer suggestions and a plan to improve the performance of the practice. Best of all, this service is performed without a contract or large financial outlay to help you understand where you stand and can afford to go.

With a dental practice evaluation, you’ll better understand:

  •  The value of your business in its present state
  •  Your personal retirement planning, if appropriate
  •  How to improve business operations and raise the overall value of your dental practice
  •     How to budget your time and effort to move forward
  •   How to continue building the dental practice of your dreams

Remain profitable

Regardless of whether or not you’re looking to sell your dental practice, it’s always in your best interest to know where your business stands financially. What may surprise you is the small changes that can be made to take your dental practice from in the red to profitable. This includes calculating payroll, evaluating your supply chain and even renegotiating rent.

If you’re still following the business model you established for your dental practice 20 years ago, you’re missing countless opportunities to increase your profits. General inflation, your current patient base and your competition are just a few reasons why it’s important to focus on the “now” of your dental practice. The best place to start when looking to assess the profitability of your dental practice is with a valuation of your business. Contact the experts at PTS to get the process started.

Know when to grow and scale

There’s certainly more to dental practice ownership than clinical work. One thing to always keep top of mind is how to prepare your business for future growth and constantly improve its value while maintaining attrition rates and attracting new patients. The key to this starts with patient care. You’ll always want to be honest about what procedures need to be done, including costs, to ensure they feel comfortable about their oral care going forward. The best way to do this is to remain focused on the patient in front of you rather than getting 10 steps ahead in your day. You should even consider switching your platforms to cloud-based software to stay in touch with patients after their appointments are over.

Think quality over quantity if you want to see a return on your investment. When in doubt, enlist the help of PTS to keep your dental practice operating on top of its game.

Start with the end in mind

Whether you’re in the early stages of retirement planning or looking to sell to a dental service organization (DSO) to offload managerial responsibilities, it’s in your best interest to start preparing for an eventual transition of ownership. It is a benefit to both the buyer and seller that the process is smooth to maintain a reputation while keeping patients and staff happy.

A professional dental practice broker, such as PTS, will advise you on:

  •  Determining transition strategy
  • Assembling a team of advisors
  • Putting together agreements
  • Keeping up the value
  •  Notifying patients and staff

After so many years of owning a private dental practice, you’ve become invested both financially and emotionally. Once you’ve decided it’s time to sell, it is to your advantage to concern yourself with the buyer‘s intentions to ensure a successful transition for all parties involved. PTS can also help you prepare a list of questions to ask your buyer to ensure a successful dental practice transition.

Avoid burnout

Above all, establish a quality-of-care threshold that works for you so you can achieve the right work-life balance. It’s easy to get in over your head when dreaming of ways to expand your dental practice, which most often leads to burnout. With every plan for expansion, your role will change, whether that’s for the better or worse. If you find yourself needing help, there’s no shame in hiring extra support staff, like a hygiene assistant or expanded functions dental assistant (EFDA), according to DentalVibe, or even considering a sale to a DSO. PTS can help to point you in the right direction.

Figure out what’s next

If considering making plans to transform your current business, PTS can successfully connect a dentist’s present with their future. To learn more about getting a free prospectus for your practice prior to selling, check out PTS’ selling services.

PTS also offers an interactive map with available dental practices for sale to help narrow down your search to make your dream a reality, based on the type of practice, number of operatories and collections, among other factors. Or, create a buyer profile to ensure you are the first to find out about new practices on the market up to five days before everyone else. Let PTS take a proactive approach to buying and selling dental practices.

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