Every dental practice grapples with the issue of overhead. Taking a careful look at your overhead costs could surprise you. Knowledge is power! In this post, we’ll offer advice for cutting practice costs and boosting your overall profitability and efficiency by analyzing your dental practice management.


Why do dental practices run into problems with overhead?

This happens for a variety of reasons, but the common theme is lack of close oversight. For instance, without monitoring dental supplier costs, staff may not know why spending is so high. Without periodic analysis of HR, ordering, and supply usage, you could miss the opportunity to have a major impact on your profit/loss statements! 

Step 1: Analyze your spending

Put your practice management software to work! Track spending and usage every month. Are you over-ordering supplies that are going unused? Are you ordering from several dental supply companies instead of just one? Are you sticking to the habit of giving regular salary increases to staff without evaluating each individual increase based on merit, performance and overall attitude?

Step 2: Make appropriate changes


  • Staff:

Much of your overhead is reserved for your most important asset: your dental practice staff. However, funding a position that is redundant or automatically giving raises without looking carefully at staff performance and productivity could be costing you. Sometimes it is not necessary to cut positions in order to reduce costs; sometimes staff members are open to reducing work hours or taking an additional day off to manage family issues. Asking the question of each staff member, “Are you interested in reducing or increasing your work hours?” might yield surprising results.

  • Suppliers:

Supply costs can be a huge drain on a dental practice budget. It’s easy to overspend on supplies if you don’t control the ordering process. Make one staff member responsible for this oversight to prevent duplicate efforts and ordering. Keep track of ordering vs. usage – are you over-ordering or stock piling supplies in the treatment rooms? Even inexpensive supplies add up!

And most importantly: when was the last time you spoke to your suppliers about discounts for volume or asked about lower cost products that may work as well as high cost products you currently use? Also, it may be time to shop around. It could be that another supplier can offer you better prices or more services under one roof.

  • Processes and Equipment:

How often do you look at your internal processes and assess their efficiency? Are there new software programs or CAD systems that you could use to increase your efficiency and cut your laboratory costs over time? Thinking about cost cutting sometimes means investing in processes and equipment that will result in lower costs over time.

These tips should get you thinking about how to trim your expenses and become more profitable in 2017. But once you start thinking about cutting practice costs, every aspect of your dental practice management can be analyzed and improved. What are your collections practices for outstanding treatment fees? How do you ensure case acceptance to improve the efficiency of every dental treatment appointment? Are your KPIs looking good? When you keep cost analysis high on your priority list, it’s amazing how much more profitable your dental practice can become!

Photo credit: kenteegardin via Visual hunt / CC BY-SA

Categories: Practice Management