Years ago, I learned how to get my Jack Russel, Ruby, to take her medication.
I simply stuffed the nasty tasting pill into a spoonful of peanut butter and she devoured it. No hassle. No fuss.
As a result, she’s lived a great life as my “best friend” and sole office companion (our water cooler conversations are 1-sided and short!).
Sometimes, I use this same technique to get my Members and Subscribers to swallow what I call the Profit Pill.
It’s like camouflage in a way. It allows me to get close to them, give them something they believe they need, and then slip my Profit Pill in with it.
Most times, they never even notice.
On rare occasion, one gets grumpy about taking their medicine.
Nonetheless, it’s as effective with them as it is with Ruby.
(No, I don’t think my Members and Subscribers are like dogs! Really? You have mud for an imagination!)
Evaluating the true profitability in your practice and learning the real number is sometimes a hard pill to swallow. Many of you reading this might require both peanut butter and a stiff drink once you find it out.
For now, let me reveal why it’s so important you pay MORE attention to your profits than you are right now.
You see, Profits in dentistry are not purely based on clinical production. In fact, they don't even originate in the clinic! (I get it: you can't have profits without production, but read on...)
We can both agree Production takes place in the clinic - in the operatories, right? (However, it does not start or end there - it starts with that first phone call from a new patient and should never stop!!)
All production really is, is an indicator of how much you and your team accomplished for the day.
And, that’s all it is.
Examples: I have some Members that do $24,000 a month. Yet, net $10,000 a month!
I have other Members doing $80,000 a month and they have nearly ZERO profit.
(And still another Member that has multiple docs in his practice; I gave him a bit of a hard time recently for not knowing his numbers. And, I did it because I care - not because I don't like him. You see, he is grossly over-compensating his associates and losing HUGE money because of it! Plus, he’s shouldering ALL the risk with ZERO reward.)
Here’s the big point: Profits come from how well that production is managed.
How well production is managed is up to YOU, the Doc...
YOU must lead your team, control your overhead and make wise decisions about expenditures – all of them – every month.
Example: If you can’t tell me your overhead percentage WITH doctor pay included, you should be able to rattle that off. You should also know your lab expense. Your supplies expense. How much you’re reducing your long-term liabilities every month. And I can go on and on.
In fact, if I were to wake you up from a deep sleep on a Sunday morning after a long bender on Saturday (hopefully that's not what your Saturdays are about), you should be able to recite to me within a 1/2% of accuracy, every line item on your P&L!
Bottomline, if you’re not IN your numbers and understand them backward and forward, you’re probably going further into the hole that you realize.
And, once you KNOW your numbers, you have to then understand what to do next: you must learn how to influence your numbers. Each and every one on your P&L. That, dear blog reader, is where the MONEY in dentistry is at...
...Knowing HOW to influence the numbers.
** If you're not yet a subscriber to Dentistry Confidential, I'd encourage you to take care of that ASAP.