The failure rate of dental practices in the U.S. is very low – around 2%. But the odds are fairly good that quite a few of those dentists in the 2% didn’t see the end coming soon enough.
That “sudden stop” is something that dentists should make every effort to avoid, and the best way to do that is to build resilience into your dental practice. The time to begin those efforts is now, because there are some indicators on the horizon that you can’t afford to ignore.
On The Horizon
There are four enormous forces that have the potential to sweep away everything you’ve worked hard to build. You’ve almost certainly noticed them individually, but most dentists haven’t connected the four forces.
Corporate dentistry is making inroads into more and more markets. Some of the chains are forecasting 20% year-over-year growth! Corporate dentistry follows the money, and if there’s money to be made in your market, they’ll be there. And a single corporate dental practice, with its economies of scale and extended hours, can force you to cut your prices to the bone just to survive.
New dental school graduates are everywhere, it seems, and for good reason. There are more operating dental schools now than at any time previous, and those schools are graduating more than 6,000 debt-laden new dentists every year. Those hungry new graduates are helping to fuel the rise of corporate dentistry due to lucrative sign-on bonuses, loan repayment programs, and attractive starting salaries. Once their debts are paid down, they’ll be looking to acquire existing practices or open their own. Either way, new graduates contribute to the relentless competitive pressures dentists face today.
Dental insurance reimbursements are being cut steadily and more of the payment responsibility is shifting to patients. That makes the lowest-price dentist for a particular procedure the likely “winner” of the patient attraction game. If you’re going to keep your new patient pipeline filled, you’ll need to join the race to the bottom on price. But unless you have the deepest pockets around, you probably won’t win this game.
Economic uncertainty is the fourth force, and it’s a wild card. The next economic recession will happen. History demonstrates that economies expand, but not forever. Every expansion is inevitably followed by a contraction. The severity of that contraction is simply not knowable. Pundits were sounding the alarm prior to the Great Recession of 2oo8, but few if any of them foresaw just how bad the economy would become. When the economy goes south, dental care becomes a luxury except in emergency situations. You’re likely to find your collections heading south in a big way.
And They Have A Name
Together, these four forces represent the Dental Apocalypse – a perfect storm that can severely damage or even end your business unless you make your practice resilient enough to weather what’s coming.
I saw this storm coming, and I wrote a book to warn dentists about it and to provide survival strategies. It’s called, The Four Horsemen of Dentistry: Survival Strategies for the Private Dental Practice Under Siege. I’m giving it away for $2, which frankly doesn’t even cover the cost of printing.
So, invest $2 and a bit of your time. Order your copy of the book at www.practiceundersiege.com and read it. Do it now, because the current situation is like a game of musical chairs. You never know when the music will stop.