Is your dental practice swimming in patients, yet you’re struggling to turn a profit? The answer could lie in your practice’s overhead.

Dental office overhead can take a serious bite out of your bottom line. Managing costs for staff, products, equipment, and other expenses can seem like a juggling act, and it’s tough to know what to cut without compromising quality of care for patients.

The good news is that you don’t need to make huge sacrifices to slash your overhead. Below, find tips for lowering overhead costs and increasing revenue.

Compare Your Overhead Costs to Industry Benchmarks

Is your dental practice spending more than the industry average? It’s common for practices to shell out too much on products and services they don’t really need.

One of the best ways to know if you’re overspending is to compare your costs to industry benchmarks. First, make a chart with expense categories and write down all fixed and variable costs for your practice. Next, think about what you should ideally be spending on each cost as a percentage of your income.

To lower overhead costs, it’s best to spend about 6% of income on supplies, 5% on rent, 5% on equipment, and 10% on lab services. Those numbers are in line with industry averages.

Can you cut any of your expenses in those categories? It may be tough to slash utility costs, but you might be able to save money by switching to a different distributor for your supplies.

Understand the True Cost of Supplies

Think you only pay for supplies when you purchase them? Think again. Dental supplies can have hidden costs that do a serious number on your profits.

For instance, how much does it cost you to hold supplies in storage if they go unused? How much do you pay in shipping fees if you need to return something? Realizing these costs can help you manage your inventory more efficiently.

Don’t Always Go With the Cheapest Brands

House brands can seem like a good deal because they’re more affordable than name-brand supplies. However, some house brands are cheaply made, which means you could end up needing to replace them sooner than you think.

Name-brand supplies and equipment may be costlier up front, but these items will last far longer than many shoddily made house brands.

Consolidate Purchases From Distributors

A common mistake many practices make is buying supplies and equipment from several distributors. Doing this can seem smart because it lets you choose the distributors with the best prices. However, you could save even more by consolidating as many purchases as possible with one distributor.

You’ll find quite a few distributors that are willing to give discounts and go the extra mile for customers who do most of their business with them. Just be sure to check out other distributors every now and then so you know you’re getting the best rate.

Join a Buying Group

If you need to buy a lot of equipment or are thinking about opening more than one practice, you could benefit from the purchasing power of a buyer group or franchise group. These groups have a mix of vendors to choose from, and you’ll often see big savings by buying from them.

Put Systems in Place To Train Your Staff

Paying staff is one of the biggest expenses for nearly every dental practice. You can’t replace all of your staff with robots, but you can put systems in place to help your staff learn how to handle tasks more efficiently.

Many practices spend more than 30% of their income on staff, but with efficiency training, you could get your overhead down to 20% or even less. Here’s how:

• Write scripts for employees to follow when a potential customer calls your practice.
• Put your preferences in writing and ensure employees understand them.
• Set aside formal time for training so all employees know what you expect of them. If you’re not well versed in training workers, you may want to hire an outside consultant for this.

Learn More About Our Solutions for Dental Practices

Now that you’ve learned how to cut dental office overhead, we welcome you to check out practice performance solutions from Dental Intelligence. Our solutions are the ticket to profitable dental services, satisfied customers, and happy employees. Schedule a demo today.