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How to reduce costs, increase marketing and boost profits for your dental practice


Many established and new dental clinics alike suffer from crippling overhead costs that reduce profits, decrease competitiveness and generate unneeded anxiety.

Many established and new dental clinics alike suffer from crippling overhead costs that reduce profits, decrease competitiveness and generate unneeded anxiety.

According to the ADA and Bureau of Labor Statistics, the median overhead for general dental practices was 75 percent. Most practices have had months when overhead reached an uncomfortable level. But when a dental practice consistently has overhead expenses in excess of 65 percent, this can be dangerous. In fact, most consultants encourage practices to maintain overhead at 59 percent or less for optimal business health.

Related reading: 4 ways to innovate your dental practice without breaking the bank

Reduce operating costs:

Operating costs are the best place to trim the fat from your monthly overhead. Not all cuts are good cuts. The following are recommended areas to realize cost-savings for your practice. 

Lab costs: Have you been with the same lab for years? Perhaps it’s time to review your relationship and negotiate more advantageous pricing on lab services. Even reducing lab shipping costs can have a measurable impact on your monthly bottom line.

Supplies: Take a good look at your procedures for purchasing supplies. Should you take advantage of discounted bulk orders? Do you have too much in inventory, especially for occasional-use items? A review of your purchasing model may reveal some cost-savings opportunities. 

Lease vs. own: Interest rates are still holding at historic lows. If you rent, now is the time to renegotiate your lease terms or look around for more affordable or more advantageous space. If you own your space, call your banker and consider refinancing at today’s lower rates. A rate reduction of 2 to 3 percent could save you hundreds or even thousands of dollars every month.

More on reducing cost: Exploring average patient cost per practice

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Internet and telephone: Internet and telephone companies are constantly offering special rates and bundled packages. If you haven’t compared rates in the last two years, it’s time to put your internet and telephone service providers up for review. Popular VOIP provider Vonage now offers an unlimited world telephone package for $29.99 per month. A toll-free line runs only a few dollars more per month. If you’re still spending $200+ per month for telephone, take my advice and trim some fat here. 

Utilities: conservation: How much money does your office waste each month on heating, cooling and electricity? While you want patients and staff to be comfortable, most offices could adjust the thermostat by one or two degrees and save hundreds of dollars every year. Consider replacing standard lightbulbs with energy efficient bulbs and watch your monthly energy bill go down. Turn off your computers at night and save hundreds of dollars per year.  Simply asking employees to be more conscious about their energy usage may generate additional areas for savings. 

Related reading: Dental fees broken down by geographic region

Inventory: It’s important to measure your inventory versus your usage rate. While it’s important to have sufficient supplies to manage your monthly patient needs, it’s never good to have too much inventory on hand. Review monthly usage over the past six months to determine your monthly demand. Take inventory every six months to ensure that you always have a sufficient but not excessive inventory of needed supplies. 

Insurance: Many of us purchase insurance once and forget about it. It’s important to ensure you’re your insurance coverage changes along with the needs of your business. Set an annual appointment to review your insurance coverage. Compare coverage with at least two to three insurance agents to get the best rates and coverages. Not only will you save on your premiums, you may also avoid serious loss that could occur from being underinsured. 

Salaries: Are your team members working up to their potential? Are any team members overpaid when compared to their contributions? Salaries are the single greatest cost for your practice. Review your team regularly. Reward the high performers and eliminate underachievers. Create a meritocracy where performance is valued and you will increase profits and reduce salary expenses at the same time.

More on cost-savings: The 4 key questions to ask before investing in new technologies

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Increase marketing:

After you have reduced overhead costs, you may feel the urge to pocket the savings. Don’t. Smart practice owners invest in solid marketing to increase targeted patient flow. Do you always have a full schedule, and don’t feel the need to market? Think again. Most practices spend an inordinate amount of time providing basic dental care such as exams and fillings, resulting in high time investments and low profitability. By targeting patients that require specific procedures such as dental implants or All-on-4, you will fill your schedule with more profitable cases and can assign smaller case work to others or use these cases to fill in the gaps in your schedule. 

Top dental marketing tools:

Website: Today, the Internet is king. If you don’t have a website, or if your website fails to impress, it’s time to invest in a website that communicates the strength of your value and brand offerings. A good website should show custom, professional photos, and should describe what makes your practice unique and valuable. Discover what makes your practice special and use this to distinguish your brand from competitors. Appointment calendars and other features are recommended to increase patient interaction. Hire a professional website design company to manage this process and deliver optimal results for your practice.

Great Expectations: Does your website pass the “test”?

Social media: If you’re not already using social media, you’re missing an incredible opportunity to share and connect with your patients online. Creating a Facebook page, Twitter account and more is just the beginning. Post to your social media pages regularly, and contribute to online groups and conversations. Remember, social media is about building community … not selling. Focus on others and contribute in meaningful ways, and watch your practice grow.  If you don’t have the time to manage your social media, hire a social media company to manage this for you. 

Video marketing: Today’s patients prefer to get their information from video. In fact, 80 percent of all internet traffic is video-based. Don’t tell people how great your clinic is. Show them with a professional video. Show your offices, patient interactions, include patient testimonials and more. This is your chance to show what makes your practice stand out from the rest. Don’t hire a high school kid with a camera or think that you can create a professional video on your own. Many have tried. Many have failed. Hire a professional marketing or video company that can make your video come to life!

Related reading: Top tips for designing a modern dental practice website

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Social responsibility: public relations:

While paid advertising is important, smart marketers invest time and energy in social responsibility projects that pay remarkable dividends in positive publicity. Donate time providing free dental care to those in need. Start a charity that gives back to the community. Get involved in local projects that help you build community contacts. Write press releases or take photos to post on social media. Demonstrate that you are a company that cares … and watch your practice earn new patients who are attracted to your compassion and admire your commitment to community. Partner with a public relations agency that can help you maximize your social responsibility efforts to increase your positive brand perception. 

There are hundreds of marketing ideas and tools to help you grow your practice and increase profitability. Many clinics report that they don’t have sufficient budget to invest in quality marketing. By using the cost saving tips above, you’ll have enough to reinvest your savings in quality, targeted marketing that will further grow your practice and generate strong returns on your investment. 

More on marketing: How to "no" your way to dental marketing success

Remember, quality marketing is an investment … never an expense.

About Patrick Goodness

Patrick Goodness is one of the most recognized names in the dental marketing industry. Dental practices from around the world rely on Patrick for insightful marketing consultation, marketing planning and international public relations services. Patrick’s results-driven approach to marketing has helped dental offices and dental labs around the world transform their brand and dramatically increase sales and profitability.

Related reading: How to use marketing to increase patient comfort

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