5 Tips For Your Dental Practice Startup
#1: Practice Lease NegotiationHiring a lease negotiator (broker) was one the best things we could have done for our startup. Often when it comes to any contract, it’s not what IN the contract when you read it, it’s what NOT in the contract. Lease negotiators are necessary to find what is left out. Of course, your lawyer needs to look over the contract, but I’d highly also recommend a broker that has done hundreds of these and knows exactly what to look for. He/she will get her fees from the landlord as a percentage of the rent that you pay.
Keep in mind though, the higher the rent, the more he/she gets paid, so this does NOT work in your benefit… be sure to know that YOU have to be the stickler on the rent price and make sure the broker knows this.
# 2: Hiring The Right PeopleAt this stage, experience matters, especially if you don’t have it (ie, billing, insurance, dental practice software, etc). When we did our startup, there were only two people. The assistant, and the dentist. This meant the dentist had to do things above and beyond what they would normally do, like cleanings,
This is often what a start-up looks like. Is it worth it? Absolutely. But you need to know it will be a grind for at least 6 months.
You need the team members to be well trained, or at least partially trained to compensate for the things you don’t know to do. Build a team around that will make your job easier, pick the right people.
The assistant we hired answered phones, collected payment, assisted, flipped rooms, ordered supplies, made reminder calls, cleaned and presented treatment plans. She was an all-star and we could not have done it without her.
#3: Keep Your Costs DownJust because the bank will loan it to you, doesn’t mean you should take it. The bank is not your friend. They are in this for money too, and the more you take out the more they make.
Have a budget and stick to it.
So, how do you keep cost down?
First…only equip 2 ops to start. Have a least 5 plumbed for a single doctor practice, but only put equipment in 2. Use overhead plumbing for construction (yes, it is possible and saves you a ton on the buildout).
Second…take on as much as you can to decrease staff overhead cost. Yes, that means cleaning, ordering, doing hygiene, and coming in after hours to work on computers or maintenance. Think about ordering used dental equipment, like forceps, autoclaves, impression guns, instruments, lathes,
There are often older practices for sale or going out of business that have a ton of instruments you can buy for pennies on the dollar. A little extra work now can cut those costs in half or even to a quarter.
Third….learn that the supply/equipment rep is not your friend. Can they help you? Of course. Will they act like your best friend, of course. Are you playing for the same team? Absolutely not.
You already know that they make their money with the more you buy, this doesn’t work in your favor. They can be a huge asset, but you have to always keep in mind, they may not have your best financial interests at heart.
Every penny you save now is worth its weight in gold because of the 5% interest you’ll be paying on that bank note, not to mention getting you out of the red sooner due to better cash flow.
#4: Marketing, And Marketing Hard
You will need to allocate funds to marketing. This is NOT the area to skip.
Often marketing falls toward the end of money spent but is probably the single most important thing you can do to get patients in your door. All of your equipment may be amazing, your team perfect, your clinical skills the best in the town… and NONE of this matters unless you have patients in the door. People have to have a reason to leave their dentist and come to you, and it’s YOUR responsibility to let them know why.
You have to market. Period.
So how to do it? It really depends on your location. Often though, specific ads that lower the barrier to entry is what is necessary.
This can be done through Pay-per-click or online advertising (google, facebook, Instagram), direct mailers, newspapers, etc.
And just letting them know you are in town ISN’T enough. They need a direct stimulus WITH AN END DATE, to finally make the commitment.
Some include a dental savings plan, a cheaper single crown offer, a new patient special, a service (like implants or Invisalign) that isn’t being offered in the community, etc.
A good ballpark for marketing is 5% of where you want your business collections for that month to be. This can go up to 10% depending on how aggressive you want to be, and believe me, you want to be aggressive.
Not all marketing works, so you WILL LOSE SOME MONEY until you find what works in your area. Remember. Marketing is testing. Even when you find what works, you KEEP TESTING to make it even better.
This is part of the game, and you have to be willing to lose some in order to gain a lot. Pick 3-4 different forms of marketing and track their R.O.I. After determining what’s working the best, drop the bottom one and either re-allocate those funds to one that IS working, or use them toward another marketing effort.
I am asked this all the time so I will say it.
YES…for my practices, we plug into Patient Drive to run our ads, track and grade calls, etc. We have taken everything that we know works and put it into a system you can plug into to have the best chance at replicating our success. You can schedule a call here and give it a try
#5: Don’t Do It Alone
The worst mistake you can make is trying to figure this out all on your own. Find a mentor or consultant that had done this before so you can avoid the pitfalls they’ve experienced. A mentor of mine, once told me, “It’s better to copy genius than to reinvent mediocrity.” Learn early that your ideas aren’t always the best.
Learn to ask for help and find the right people to surround yourself with. Try to learn from other’s mistakes instead of taking the financial (and stressful) hit yourself. My mom always said, “You are who you associate with.” So pick mentors and friends around you that are successful, and soon enough you’ll be there too.
Again, we are always glad to help.
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