If you’re at the point in your career when the time for putting your dental practice for sale is getting near but you’re not sure if you’re really where you need to be in terms of your collections, you’re not alone. Fortunately, there are some pretty simple things you can do to help boost those numbers. And, you don’t have to figure it alone. Below we’ll share some tips on how to create more efficiency in your practice, which can help lower overhead and increase productivity, both of which impact your profitability and will make your practice more attractive to buyers.
Many doctors think about the profitability of their practice in isolated categories. What are my overhead costs? What are my collections? What is my production rate? No doubt, these are significant factors. But the key to understanding how to boost profitability is in understanding all of the moving parts that contribute to these factors and how they relate to one another. That understanding leads you being able to make necessary changes that allow you to work smarter, not harder, to reach your goals.
Rethink Your Scheduling to Maximize Efficiency
One approach to scheduling is to break the day into time segments and try to fill them all up. If you’ve got a full schedule each day, that’s great. But how can you increase collections if you’re already at capacity? Remember that not every task you do during the day requires the same effort and skill. By considering how your energy and attentiveness ebbs and flows throughout the workday, you can maximize your productivity by scheduling to those patterns.
For instance, if you feel the most fresh and alert in the mornings, use those times to do your more intensive procedures and prepare crowns. Save the fillings and simpler procedures for later in the day. You’ll get those more intensive tasks done quicker than you would if you’ve scheduled them for when you feel the drag of the workday later on. Saving that time can allow you to fit just a little more in your day than you would have otherwise, which adds up day after day, week after week.
This will require some training and supervision of staff as they learn to steer patients to an appropriate time slot based on the procedure. However, your staff should understand that this is not only good for the practice, it’s good for the patient as well. You’ll be better able to perform those intensive procedures, with fewer hiccups, and get the patient on their way a little faster. This is good for patient retention, your reputation, and your band, all of which will reflect in a more value when you put your dental practice for sale.
Relatedly, consider scheduling new patient appointments immediately after the lunch break. This way, you will never be late for that appointment, creating a good first impression: one of reliability and organization.
How Well Does Your Team Work Together?
You may have a great staff that you’ve carefully selected and trained over the years. You may even have no complaints about any of their performance. But this doesn’t mean that there isn’t room for improvement. Not just change for the sake of change, but honing the skills that already exist.
This is all about saving time. A perfectly efficient office is one where there is no wasted time or forgotten tasks. All of the departments are both running smoothly and well-integrated so that as patients, records, information, and materials flow from one to another there are no points at which the system stalls or breaks down. Since, however, we do not live in a perfect world, it’s unlikely your office runs this well.
Consider each staff member in their individual role. Do they know their job well? Do they understand their role in the organization—how they are supporting you in providing the highest quality care to your patients? Do they forget tasks or overlook details? If so, is there a pattern? Your answers to these questions will show you where additional training or supervision may be needed.
Also consider your employees as a unit. How well do they work together? Are there conflicts? Do they communicate well? How integrated is each department? Again, your answers to these questions will show you where organizational refinement may be needed.
The importance of saving time is in reducing overhead costs. Every instance in which you have to take time to address an error, to track something down, to intercede between employees takes time away from your schedule and from theirs. The smoother your office runs, the more everyone can get done within a day. And, as with scheduling, the savings may be incremental, but they will add up, especially when combined with the other changes.
When it does come time for you put your dental practice for sale, your buyer will be impressed with how well your office functions. The efficiency will boost patient satisfaction (benefiting retention), employee satisfaction (happy employees make a positive impression on patients, and can protect your staff during the practice transition (increasing their value to the practice will encourage the buying doctor to keep them on and take care of them).
Look at Your Patients and How they Pay
Even if you are at full capacity, you might be losing out on collections depending on how you are paid for your work. If you accept reduced fee-insurance, are those patients edging out other patients in your schedule who would pay full-fee? Are your fees up to date? When did you last raise them? What is the market value for your services and are you charging appropriately (that is, how do your fees compare to other dentists in the area)? Even if your fees are, in some instances, capped by PPO insurance plans, you don’t have to charge your non-PPO patients at that same rate (and if the PPO fees are below market value, you can use that if you renegotiate with those insurance providers).
Some of these areas can be tricky. Retaining outside experts such as a dental transition specialist, a dental CPA, or a dental practice valuator. You’ll need this kind of professional expertise when you put your dental practice for sale, so building those relationships now will only get you closer to where you want to be before your practice transition.
Update Your Technology
Regarding technology, there can be a limit to how much value you will get out of it. Whether the updates will really boost value will vary from instance to instance. Here are some general guidelines of what is, typically, always worth doing.
Digital radiography and practice management software are the norms. If you don’t have these, you should. First, they both will boost office efficiency and, especially the digital radiography, can translate into higher patient satisfaction. For more on this, read our post about how tech upgrades can add value. Second, whoever buys your practice is likely a much younger doctor who is going to have trained on these systems and may be turned off by the idea of buying a dental office with outdated systems.
Technological upgrades can be expensive, meaning they’ll take time to translate into profitability. However, just because they may not reach that point in your practice before you sell, that doesn’t mean that you won’t see the value reflected in what you are able to get for your practice. Figuring this out can be tricky, though, and consulting with practice transition specialists and dental practice valuators will help you make the best choice for your practice.
Are You Considering Putting Your Dental Practice for Sale in the Next Five Years?
At DDSmatch Southwest, we work with you to determine your goals for your dental practice transition and help you find ways to work toward meeting those goals. If you are considering putting your Texas or New Mexico dental practice for sale in the next five years, we offer a free, no-obligation Practice Transition Assessment. As part of this assessment we’ll discuss the current local market for dental practices, advise on potential practice investments to increase value, suggest other physical and image improvements, and more. Contact us today for your free consultation.