all articlesJune 7, 2009
Recession Proof Your Dental Practice
Most of what I share on this blog (Igor here) is the knowledge I’ve gathered – and applied – from the likes of Bill Bartmann, Joel Block, Dave Lindahl, and a few more highly successful businessmen. Collectively, they have helped me devise this list of basic business strategies to help your dental practice not only survive our economic slowdown, but come out stronger than ever before.
As a local business, your ultimate goal is to outlive your immediate competition, which is dealing with the very same problems you are. In doing so, you are likely to inherit their share of the market. Some of what I suggest may be uncomfortable, but it is logical and necessary.
Stop Extending Credit
I urge you to apply this strategy in good and bad times because it will retain a higher quality of customers and won’t impede your cash flow. Yes, you are likely to lose a few patients, but the kind you probably wouldn’t miss in the first place. Remember, it’s your cash flow that keeps your dental practice in business, not your revenue. I suggest limiting financing to third party credit unions like CapitalOne or CareCredit.
Eliminate Unnecessary Spending
This includes special perks you may be providing for your staff (keep the bonus system in place!!) and luxury spending on your office space. If you like hosting a monthly staff meeting at a five star restaurant, I recommend you order pizza instead.
Trade Front Desk Person for a Salesperson
During the survival mode, anyone who isn’t directly involved in producing for your dental practice is expendable. This may be a good time to replace an extra front desk person for a good treatment plan coordinator. I would also advise against cross-training employees because you will cause discomfort in making people perform tasks they don’t enjoy and probably aren’t qualified for. Moreover, you will waste your time and money when you could easily hire someone specifically for “the” job.
Ask Vendors for a Discount
Call your vendors and laboratories; ask for exclusive discounts in exchange for a committed relationship. You’ll be surprised by how much it will lower your overhead.
Expand your Marketing
Refine your marketing campaign to accurately target your local area and if that means spending more money, so be it. In my article, Effective Dental Marketing Model, I briefly touch on marketing outlets that are particularly effective in dentistry. The key is to study your ideal customer – usually a middle aged woman with kids — and exploit all effective outlets with a marketing campaign that would appeal to your ideal customer.
Instead of creating a comprehensive set of strategies for dealing with an economic slowdown, I chose to list the above five guidelines because an economic slowdown manifests itself differently in every situation. There is no “cookie cutter” approach.