Opening your very own dental practice is an exciting endeavor that can bring countless benefits to your life. However, within the first few months and years of opening your business, you’ll face a lot of challenges, including the steep financial learning curve.
When it comes to financial management for dental startups, there are dozens of variables to consider and plan for. While it may be daunting to build a solid financial roadmap, these steps can get you started on the right path.
Calculate a Budget
Budgeting is crucial in any business, and it looks different in every industry. When starting a dental practice, you should start by outlining your anticipated expenses. For most offices, these are the primary costs to consider:
- Payroll and tax
- Administrative costs
- Lease or mortgage
- Supplies and lab ordering
- Equipment
- Marketing
Your budget will change and shift as your business does. It’s important that you regularly revisit your budget and closely examine any changes, inefficiencies, or areas for improvement. Doing so will help you build a flexible long-term financial strategy that continuously meets your needs.
Track Key Performance Indicators
Key performance indicators (KPIs) are data points that allow you to measure the health and efficiency of different parts of your practice. Tracking and monitoring them allows you to create quantifiable milestones that will help you reach your financial goals.
While your KPIs will be unique to your practice, some of the most common KPIs in dentistry include the number of new patients, cancellations and no-shows, and accounts in collections. Revisiting these data points each quarter will help you determine which areas of your business need attention.
Choose Your Suppliers
Supplies and equipment are two major overhead costs for dental startups. Establishing strong relationships with trusted vendors is a great way to get the most value for your funds. To find the right vendors for your needs, try following these steps:
- Research multiple vendors
- Request quotes from each supplier
- Examine price differences per product
- Negotiate discounts if possible
As a new business owner, trying to negotiate with vendors and suppliers may feel overwhelming. That said, most companies want to build long-term relationships with their clients and may be willing to offer you more value in return for continued business.
Implement Efficient Technology
Great technology won’t just simplify your day-to-day; it can also help you save money directly and indirectly. With the right dental management software, you can cut costs by:
- Automating tasks like scheduling or appointment reminders
- Improving the patient experience and retaining customers
- Processing insurance claims and tracking payments
- Verifying insurance eligibility
There isn’t a one-size-fits-all solution to dental management software, so examining your unique needs is important. Are you planning to keep your practice small, or do you want to grow into an enterprise? Do you want your software to integrate with billing, inventory, and scheduling?
Asking these questions can give you a good idea of what you want from software. Once you know what you’re looking for, a dental IT expert can match you to the right product for your current needs and long-term goals.
Get Help From a Professional
It’s challenging to handle every aspect of your new practice’s financial plan on your own. The last thing you want is to miss an important detail that costs money or jeopardizes your business down the line, but that’s exactly why professionals are here.
At Mahan Dental Law, we focus on helping dental startups in Cincinnati take off with confidence. Our team of dental attorneys and practice advisors can assist with everything from business planning to branding, marketing, and entity formation.
Whether you have a single question or want ongoing support, we’re ready to help your new dental startup thrive.
