Developing Ancillary Profit Centers: An interview with Dr. Bernard Schechter

Oct. 1, 2002
Dr. Bernard Schechter is a 1967 graduate of New York University College of Dentistry. He is a former faculty member of the Henry M. Goldman Boston University School of Graduate Dentistry, Department of Fixed Prosthodontics, and also holds a certifying degree in therapeutic biology.

by John Jameson, DDS

Dr. Bernard Schechter is a 1967 graduate of New York University College of Dentistry. He is a former faculty member of the Henry M. Goldman Boston University School of Graduate Dentistry, Department of Fixed Prosthodontics, and also holds a certifying degree in therapeutic biology. He has spoken at dental meetings and health expositions nationwide, and has written numerous articles for dental and health publications. Dr. Schechter is founder and president of Dental Herb Company. In addition to his corporate duties, Dr. Schechter devotes his time to research in the area of botanical remedies for periodontal disease and halitosis. He can be reached by phone at (800) 747-4372 or by fax at (561) 241-5169.

Dr. Jameson: One way dentists can create a profit center in their practices is by offering additional products to their patients.

However, many dentists worry that marketing products in their practices creates an unprofessional environment. What do you recommend to dentists to help them overcome this perceived stigma?

Dr. Schechter: First of all, I think attitudes about marketing have changed. Twenty-five years ago, it was considered unprofessional for dentists to advertise! Today, the majority of dentists advertise — either in the Yellow Pages, newspapers, magazines, radio and TV, direct mail, and even on the Internet. It's actually unwise not to advertise!

The products that dentists market are good for patients, and they usually cannot be found in stores. Dentists are actually providing a service to their patients by making products available to them that are effective and beneficial to their oral health.

Success requires that dentists market their services. So I think the image of dentists marketing products in their practices as "unprofessional" is fading — rapidly!

Dr. Jameson: How did the idea for Dental Herb Company come about?

Dr. Schechter: I created Dental Herb Company for my patients who wanted to avoid surgery, but keep their periodontally involved teeth. I began studying botanical medicine in 1969. By 1976, I had substantially increased this research. It took more than 20 years to develop the current formulae, which we introduced in 1996.

In April of that year, I made a presentation to 40 dentists in Washington, DC, all of whom were treating patients with anti-infective periodontal therapy. More than half of these doctors immediately ordered the Tooth and Gum Tonic and Under the Gum Irrigant. The company was up and running, and it has increased exponentially in the six years we've been in operation.

Dr. Jameson: How has this business evolved?

Dr. Schechter: Dental Herb Company has evolved from a spare room in my Massachusetts dental office to our ultra-modern facility in Boca Raton, Fla. Our products are marketed strictly through dental offices. We've grown in a number of ways. For example, nationally renowned educators like Drs. Gordon Christensen, Joe Blaes, Rich Madow, Woody Oakes, and Tom Orent have all been writing and lecturing about Dental Herb Company products for the past six years. Our dental clients refer our products to their colleagues, while advertising and direct mail have also helped us grow. We've even noted that hygienists who move on to a new dental practice request that their employers start stocking our products. The word of mouth has been extraordinary.

Dr. Jameson: How do these products benefit patients?

Dr. Schechter: First of all, these products are truly natural. They contain only the highest quality, pure essential oils and organic herbal extracts. They are alcohol- free and contain no artificial chemicals or preservatives. They are hugely effective on three fronts: antimicrobial, connective-tissue rebuilding, and tissue conditioning.

Our four products have four delivery modalities: Oral Rinse, Subgingival Irrigating Solution, Dentrifice, and Spray. All contain the same active ingredients compounded in different proportions, depending on the function and purpose. The Tooth and Gum Paste also contains green tea extract, which is becoming known for its ability to stop carcinogenic bacteria from forming glucan and for its ability to reduce the pathogenecity of periodontopathic bacteria. The products treat both periodontal conditions and halitosis. They can be utilized for therapeutic, maintenance, or preventive purposes. They are unique relative to other products on the market; they provide multiphasic benefits to patients without using artificial chemicals or antibiotics that can result in resistant strains of bacteria.

Dr. Jameson: Your success with Dental Herb Company truly is inspiring. Would you agree that, regardless of what ancillary profit centers dentists include in their practices, it's important that the team is committed to it? How do we involve our teams with ancillary profit centers?

Dr. Schechter: The staff needs to understand first and foremost that the products are for the patient's benefit. They need to fully commit to the reality that they are helping patients. Dental teams have an extremely important role — they make certain that patients get the correct products, and they have the equally important task of ensuring that patients use the products correctly.

One incentive I've found is to offer a percentage of product sales to the staff as a bonus. Ten percent is a fair amount. For example, let's say you have 500 patients and each buys $200 worth of products per year. The practice will gross around $100,000 in product sales, which adds up to about $50,000 in net profit. The dentist can distribute 10 percent — or $10,000 — to the staff as a bonus. A staff of four would average around $2,500 per person. That's a significant figure — and a serious incentive for employees. I'd like to add that the sales estimate is pretty conservative. The amount can rise considerably when you factor in sales of products such as home-bleaching kits in addition to home-care products. I personally know a large number of practitioners whose actual profit is more than $100,000.

But marketing products directly to patients does not solely benefit doctors and their teams. Patients benefit as well. It's convenient to purchase home-care products while at the dentist's office. Instead of going blindly into a drugstore and purchasing whatever is on the shelf, patients receive quality products and customized instruction on how to use them from a professional, caring staff.

Dr. Jameson: There is an enormous variety of products on the horizon today. Where do you think the trend is headed?

Dr. Schechter: Over the next 10 to 15 years, all high-profit practices will have ancillary profit centers. They'll have to. Two forces are driving this trend. The first is increased overhead. Dentists are human — they can only see so many patients per week. There are limits to efficiency, and expenses like equipment, building and construction costs, and, of course, employee-related costs keep increasing.

The other demand that will drive the increase in ancillary profit centers is the basic but very real need for dentists to increase their income levels. Having an integral profit center delivers top-of-the-line care to patients, but also allows dentists to significantly augment their incomes, and, therefore, their level of satisfaction. The impact manifests itself by signaling to existing patients that your practice is committed to state-of-the-art, patient-oriented care. Patients are grateful for this kind of attention and for the opportunity to buy quality products that ensure maximum dental health. Most importantly, your patients will then refer their family and friends!

In addition to marketing products to patients as they receive treatment, dentists also can direct-market these products. For example, a dentist can generate a letter to patients who are due for an annual checkup that mentions the kinds of products that are available. It's also a good idea to send letters to inactive patients — those who haven't been seen in two years or more — informing them of the advances in treatment and products that the practice now offers. This kind of communication may be the push that "reluctant" patients need and can revive a dormant relationship.

Dr. Jameson: Your comments confirm that attitudes towards ancillary profit centers must change because patients have changed.

Dr. Schechter: Exactly! Patients today are, more than ever, "dental consumers." They shop around for dentistry like they shop for a car, because dentistry is an investment in their health. And among the decisive factors are, "Is this practice up-to-date on all of the latest equipment, treatments, and products?"

Dr. Jameson: What advice would you give to practitioners who are considering establishing an ancillary profit center?

Dr. Schechter: Practitioners must realize that it will be important for their patients. Dentists can be sure that when patients purchase products directly from them, they are getting a high-quality product that will directly improve their condition. I would also advise a dentist that establishing an ancillary profit center is an acceptable component of the successful modern practice. It benefits patients; it benefits staff members, and it benefit dentists. Ancillary profit centers are practice builders — period! Dentists should also keep in mind to treat an ancillary profit center like any other business aspect of their practices. Develop goals for whatever you decide to implement, then communicate those goals to your staff. Monitor and measure the results, and adjust accordingly.

Finally, remember that above all the profit center will work — especially if you have the motivation to earn another $25,000 to $100,00 — without having to pick up a handpiece or curing light!

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