By Susan Nevenhoven, Client Advisor
As a practice owner, what would make you happy? Lowering your production costs, increasing productivity, or finding ways to get more value out of your office space? How about all of the above?
Those are some of the results enjoyed by practice owners working with dental CPA firms to improve their businesses by using key metrics. It’s not easy work and choosing a dental CPA firm is just the first step, but for dentists willing to engage in the process of understanding what the numbers tell them about their business – and then willing to act on that information – the results are worth it.
Taking a Hard Look at the Data
Your practice generates a lot of data and dental CPA firms know how to use it. We can provide benchmarks for key metrics that shed light on how your business is performing relative to the gross collections. Dental CPA firms have a major advantage in this area; we only work with dentists, so we have access to a huge pool of data. No matter what size or type of practice you have, we know what the metrics should look like for your business. By digging into the details, we can tell where your practice is doing fine and where you should make some adjustments.
We know from experience what the production costs for a healthy practice should be, so we dig deeper to find out what’s behind any number that seems high. We take the time to review expenses with clients to identify cost savings and efficiencies that make sense for them. After that, it’s up to each client to decide what action to take.
We also pay attention to facility expenses, especially rent. Since rent is a fixed expense, one solution is better space utilization. For example, has the client thought about implementing assisted hygiene or reducing the time they allow for appointments? These changes can improve productivity and increase revenue. Another approach is to see if it makes sense to to bring in a specialist a few times a month. First, we’d run the numbers to see if there would be any additional costs involved. If it looks promising, we’d discuss the benefits to adding a visiting specialist who could provide services inhouse, making it easier for patients while creating additional revenue for the practice.
Good Metrics Lead to Good Business
Even though dental CPA firms rely on benchmarks to determine good metrics, we don’t believe in one-size-fits-all solutions. Each practice owner needs to decide for themselves what solutions are right for them. For instance, some clients have told us they prefer to use a more expensive lab because they felt they got better, more reliable results. Since it was important to them to stick with the lab, we helped them look for other places to lower costs.
A good dental CPA firm will have metrics for the key financial areas of your practice, including general and administrative costs and payroll expenses, as well as benchmarks for practice production and facility costs. This information is crucial to building and maintaining a thriving business. Dental CPA firms can help you dive into the numbers, decipher their meaning and provide good options to address any problems they reveal. Ultimately, it’s up to you, the practice owner, to decide what changes to make and to implement those changes. I can tell you from personal experience, the clients who’ve been willing to do the work have been very happy with the results!