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The Middle’s Disappearing: Which Direction Do You Go?

by Jerry Jones | Oct 25, 2018 | Case Studies, ClearPath Society, Clinical Dentistry, Dental Advertising, Dental Marketing, Dental Practice Management, Dentistry Confidential, Digital, Economy, Leadership, Management, Positioning, Sales Mastery, Self Improvement, Time Management, Uncategorized

If you have more than 5 to 10 years left in Dentistry, you’ll want to start considering how the income pyramid is changing, has changed and will continue to change.

The middle class is shrinking. The top is growing. The bottom is growing faster, and most in the middle, headed to the bottom. Why’s this important to you?

Depending on what patient class you predominately serve, your business model and for sure, marketing model, will be forced to change and adapt. If you serve the lower class, a lot of Medicaid patients, or your practice location is in a dying area, I’m waiving a massive yellow flag of caution at you. Unless you change your business model to deal with your patient base’s economic reality, you’ll find yourself dealing with tighter and tighter margins. If income per patient is dropping (run a Dentrix report from 2008 to 2018-YTD and compare), then you really have a problem that must be addressed now. Not later. Maybe even a re-location is in order. If your income per patient has dropped, that means you’re having to see more pts to make the same amount of money, and for sure, your overhead must be pushed down to the bare minimum to compensate in the short-term. However, just because your income/pt is down, there may be other factors at-hand that need to be reviewed. Reach out to me if that’s the case.

If you’re in the middle, you need to make a decision. If your patients are predominately blue collar with a mix of upper and lower incomes, my advice: Skew to a higher income. Change the dynamics of your physical plant, your location, your staff, what you offer (as example, affluent patients have a different motivation for going to the dentist – and they’ll pay more to go less), etc., to cater to a higher income. And, most importantly, you’ll likely need to change the way you market your practice and to whom you market.

In the near future, as this income shift plays out and the middle continues to wither on the vine, there will be a more clearly defined place for each kind of practice, but the model of each are so different that co-existing in the same physical space and location are going to be more and more challenging if not impossible. You will need to make a choice. And, the existence of chain dentistry will make this easier for you.

At many offices, this economic reality is setting in. Plan and do demographic research now to find out where your patient base lies. You may need a location change, a facelift, and a different approach to marketing – making sure your message gets into the hands of those you want to attract. That means working harder and more diligently at generating referrals. And, it means making sure every team member takes advantage of every selling opportunity. The alternative is ugly.

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