Words I don’t want to hear again
Louis Malcmacher, DDS, MAGD
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It’s only two crowns per month!
If I ever hear those words again from any dental salesperson, I’ll get sick. We hear statements similar to this all the time regarding which investments to make for our office in terms of technology, equipment, products, or whatever else someone is trying to sell us.
It often sounds like this: “Doctor, this new piece of dental equipment will pay for itself — the lease payment is only the cost of two crowns per month, and after that it is all profit.” Well, that doesn’t sound like much — if I do 20 to 25 crowns per month — and for only two crowns per month (in other words, a lease payment of about $2,000), I can have this piece of new technology and it will certainly pay for itself.
It’s this kind of thinking that has caused an underlying problem for many dental practices that you may not even know exists in your own practice. What is your debt service? How much do you pay each month on leases or loans to finance new dental equipment, technology, office build-out, hardware and software systems, and the like? Since you write a number of different checks each month, have you ever sat down to figure this out?
I first heard about this issue from my good friend, Sally McKenzie of McKenzie Management. Sally has been one of dentistry’s premier dental consultants for many years, and she started her career as a dental office manager in Columbus, Ohio. Sally says that one of the biggest problems she sees with many of her clients is that they have no idea how much they pay out every month.
I have confirmed this with a number of other dental consultants. Many dentists have fallen into the trap of thinking, “It’s only one or two crowns a month,” “After your first six restorations, the rest is profit,” or one of my personal favorites, “You will lose money if you don’t buy this.”
How do you solve this problem? First, get to know the facts. Sit down and really find out how much you are paying in lease and loan payments for everything in your office.
Because you are probably writing checks to a number of different financial institutions, it may not seem like a lot to you, but you may well be shocked when you total it. Please seriously consider consolidating your debt.
Sally McKenzie described this situation of one of her clients in the Midwest. McKenzie Management was able to arrange an $850 per month reduction by consolidating all of the client’s payments to a single financial institution. If consolidating your debt can save you even $100 per month, then it is worth doing.
My rule for investing in anything, whether equipment, technology, practice-management systems, or anything else in dentistry, is simply this — will it change the patients’ experience by providing faster, easier, and better dentistry? Clinically, it comes down to efficiency that will result in better patient treatment outcomes.
For me, anything that fits into this kind of category is worth the investment. These include lasers (Lares Dental, Waterlase MD, Biolase or Picasso ATL, AMD Lasers), injection comfort systems (DentalVibe), bulk fill composites (G-aenial, GC America), fast composite matrix systems (V3 Ring, Triodent), and patient financing (CareCredit).
Don’t relate any of these investments to how many restorations or crowns it will take to pay for your purchase because that by itself has absolutely no limit. In other words, you will keep investing in everything because it is only two crowns per month. At the end of the month, you will have only done 30 crowns while paying leases totaling 50 crowns per month. This is when your office begins to go underwater and it can be nearly impossible to turn around.
Always think before you buy, and carefully consider your options. Always fight to get the best deal possible, and understand carefully whether your investment will really make you more profitable and give you a great return on investment.
Dr. Louis Malcmacher is a practicing general dentist and internationally known lecturer, author, and dental consultant known for his comprehensive and entertaining style. An evaluator for CLINICIANS REPORT, Dr. Malcmacher is the president of the American Academy of Facial Esthetics at facialesthetics.org. Contact him at (440) 892-1810 or email [email protected]. His website is www.commonsensedentistry.com, where you can sign up for a free monthly e-newsletter.