Tom Orent, DMD
Boost profit instantly and without spending another dime! Sound too good to be true? Not necessarily so. I just returned from Las Vegas where I observed an all-too-common occurrence in a small business. Big money just left there on the table! And it cost them. Dearly.
You already know all about fixed vs. variable overhead. Fixed is covered. Doesn't matter if you do nothing, or if you add 10 more crowns than usual this month … your fixed costs are the same. Utilities are paid, rent or mortgage isn't going to change, and the cost of your malpractice, overhead, business interruption, insurance, ad nauseum, isn't going to budge. Bottom line? You'll dramatically boost your bottom line by doing anything beyond your "normal" … once the fixed costs have been covered.
Exactly what did they leave on the table in Vegas?
My son and I went "indoor skydiving" in Las Vegas. If you ever get the chance, it's a thrill … and it sure beats jumping out of a perfectly good airplane! We spent two mornings at the wind tunnel/skydiving school. Several things happened which clearly indicated they were "leaving money on the table" - a phrase that refers to a business turning its back on simple-to-capture business opportunities.
r Losing new customers during the initial call - They had a great Web site, and a variety of print ads that drew lots of interest from folks visiting Las Vegas. Their phone rang no less than once every 10 minutes with potential new business begging to be developed. Though I could only hear one side of the conversation, very little was left to the imagination. They were almost all the same call. The woman at the desk answered with the name of the business, followed by a brief pause. During the pause, nine out of 10 callers must have asked, "How much do you charge for indoor skydiving?" The answer was always the same, "It's forty-five dollars. Sure. You're welcome."
Unless they grossly undervalue their own service and have subsequently priced it way too low, there have got to be some people on the other end of that phone who never go any further than that initial call. What would I recommend to that business when answering that call?
Tell the caller in no uncertain terms how much of a rush - how incredibly thrilling - it is to go indoor skydiving. Let them know how certain you are that they'll love it just like 99.9 percent of everyone who has ever walked through your doors! Let your enthusiasm exude through the receiver and into their ears … until they're convinced that they can't leave Vegas without jumping into your wind tunnel! She never said one word other than, "It's forty-five dollars …"
Missed opportunity to sell adjunctive products/services - This was without question one of the most exciting things my son and I have ever done. The wind tunnel is a vertical cylinder roughly three stories high. At the base, there is a powerful airplane engine covered by protective netting. The propeller generates wind speeds of up to 150 miles per hour. As you step off the edge into the tunnel, you're "flying!"
Imagine showing a film of this to your friends and relatives at home! It wasn't until we'd been through the safety briefings and were all suited up (jump suit, goggles, and helmet) that I heard one of our classmates say that she had elected to have herself videotaped! What a great idea! Only thing was, no one told us that was even an option! Not only that, you have to tell them in advance that you wanted to purchase a video (so they could pop a tape into one of three recorders).
The fact that it was never offered when I paid at the front desk blew me away! Not so much for me, but for them as a business! The fee to tape your session was extremely reasonable. Just $15, including the price of the tape itself. How many others were skydiving without the chance to show Mom or Aunt Mabel what they did on their Vegas vacation? Given the number of classes they run through in a day, it's likely they were leaving tens of thousands on the table each year from just from this single oversight. One quick question would have sold 95 percent of the skydivers: "Would you like us to videotape your session today so you can take home a movie of your skydiving?"
Giving up the chance to nail down repeat business - And then there were the missed opportunities to nail down repeat business. After our session, I told one of the other students how much we'd enjoyed it, and that we were likely going to try to return the next day for more. My classmate asked if we'd purchased the multi-day pass … of course, my answer was, "What multi-day pass?" No one had told us there was such a thing. The rates for multi-day were a real bargain! We did end up returning for more … and they were kind enough to allow us a break on the second sessions … but they easily could have enticed us into multi-day packages … just by trying!
In all, this business is clearly leaving an enormous chunk of their potential profits just sitting on the table. It would take very little imagination, and even less effort to secure significant increases in revenues … and even more significant improvements in profit - because the majority of what's left on the table would go right to the bottom line.
What are you leaving on the table in the dental practice?
Every practice will have different answers to this question. It would be an incredibly valuable exercise to involve your entire staff investigating this one. Have an in-office pizza lunch meeting. Get the whole team brainstorming each separate phase of the practice, one category at a time. Potential new patients on the phone … what do we say to them? What's our present conversion rate, and can we improve it? Recall patients … how many of them know about "XYZ" new services that you offer?
How can we improve on that? Complementary (things that go well together) services you offer … how often do you consciously group them together and offer a "package?" The possibilities are many … get your team excited about working with you to identify and then pursue money "left on the table!"
Dr. Tom Orent, the GEMS GUY, is a management consultant and practicing dentist. He is a founding member and past president of the New England Chapter of the AACD. He has presented his "1,000 Gems Seminars™" in four countries and at state and national meetings in 46 states. He has lectured at numerous dental schools and is the author of four books and numerous articles on aesthetic dentistry, practice management, TMJ, and "Extreme Customer Service." Dr. Orent may be reached by phone at (888) 880-4367, by fax at (508) 879-4811, by email at firstname.lastname@example.org, or visit www.1000gems.com.