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Five things to know before starting your dental practice

Five things to know before starting your dental practice

Synopsis
4 Minute Read

For dentists opening their own practice, there are a lot of moving pieces. But whether you’re just getting started, or have been in the industry for a while, there are some key things to consider, and actions to take, that can help ensure a smooth transition into your successful business.

Starting your own dental practice is an exciting milestone. Whether you’ve been in the industry for a while or you’re just getting started, you’re likely looking forward to the years ahead and eager to get to work.

But this new beginning is also one of the most complex and high-stakes decisions a dentist can make. From choosing the right location to securing financing, hiring staff and building or growing a patient base, the journey is filled with critical choices that can shape your success for years to come.

Here are a few steps to help guide you and ensure your business can get started off on the right foot.

1. Start with a thoughtful financial analysis

Before making any major decisions – whether it’s hiring staff, investing in equipment, or signing a lease – take the time to understand your financial picture. Building a clear, realistic view of your cashflow, revenue projections, and more can help you prioritize wisely.

A financial analysis can show if you’re ready to bring on a new associate dentist or if it makes more sense to wait, it can help guide decisions about technology upgrades, or even how many days you should be open in your first year. Without a solid foundation, and understanding of your financials, you won’t be able to make informed decisions that could have lasting impacts.

2. Conduct a 360-degree analysis

After a thorough financial analysis, it’s key to get a full, 360-degree view of how those financial decisions will impact the other moving parts of your practice.

As a business owner, you are responsible for looking at all decisions through the lens of dentist, entrepreneur, employee, and patient. With each decision, you should be assessing the impact on all people involved.

For example, if you purchase a new piece of equipment, ensure staff are well trained on how it works and how to effectively and appropriately explain to patients the purpose of this new tech. It might make good sense to get the latest and greatest equipment for your practice but if patients are confused about its purpose or don’t see the benefits to their care, a lack of understanding could cause distrust.

3. Utilize real-time KPI tracking

Most practice owners will meet annually with their accountant to go over the key metrics from the previous year. But consider the benefits of real-time key performance indicators (KPIs) in ensuring you’re on top of any concerns or challenges.

With real-time KPI tracking, you can make changes that are more efficient and enable ongoing improvement instead of playing catch-up many months later. Assessing major KPIs – like revenue, new patients, expenses, occupancy rates – on a regular (think monthly) basis, can help provide clues of where to make changes for the biggest impact before they become big concerns.

4. Focus on efficiency before growth

A bigger clinic or more fancy equipment often doesn’t mean better business. It’s tempting to chase rapid growth – more patients, more staff, more services – but the practices with the best profitability margins are the efficient ones.

From streamlining your workflows to optimizing scheduling and ensuring your systems are running smoothly, there are many steps you can take to boost efficiency without the pitfalls that can come with scaling too quickly. By tightening up your operations before expanding, you create a practice that’s not only sustainable but also scalable.

5. Build a trustworthy team of advisors

Like in any business, the success of your practice depends on having the right experts in your corner. From legal structure to tax planning and IT systems and compliance, the decisions you make early on can have long-term implications.

Look for professionals with direct experience in the dental industry. Whether that’s lawyers who’ve helped other dentists navigate incorporation, lease agreements, and partnership structures, or accountants who know how to manage dental-specific cashflow, insurance claim input tax credits for orthodontic appliances, and equipment depreciation, industry-savvy experts can make all the difference.

At MNP, we know the dental industry. From financial planning services to consultation, tax planning, cyber security services, and succession, our team of experts knows how to help dental practices meet their full potential.

Whether you’re a titan of industry or just learning the ins and outs, MNP advisors can help you assess your operations at every step to help discover ways to boost your efficiency, introduce new products to improve workflow. Our tailored services ensure you’re getting the specific approach you need to reach your goals.

Contact us

Visit our page to learn more about how you can set up your practice for success.

Ariane Babin , EEE, MBA, DMD

Partner

418-425-3422

[email protected]

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