Want to Grow Your Practice Collections? Marketing May Not Be the Solution

Nate Williams Practice Management 1 Comment

As your financial advisors, our work begins after money transfers from your patient to your bank account. Collections are the lifeline of your business, and although we’re not technically responsible for how you collect money, as your financial partner we take great interest that you do collect money. When our clients want to grow collections, a very common response is to throw more money at marketing, intending to bring more patients into the practice. Or worse, they may be tempted to bring on more insurance PPO contracts to attract new business. But oftentimes, these solutions don’t address the real issue.

Nate WilliamsWant to Grow Your Practice Collections? Marketing May Not Be the Solution

Dental Practice Embezzlement

Ryan Millar Practice Management 2 Comments

Embezzlement is a real concern among dental practice owners, as it should be. The statistics and reports vary, but it’s safe to assume that if you don’t take precautions, then you have at least a 50/50 chance that an employee steals from you during your career. All cases of embezzlement are sad, but some are tragic, with the doctor losing hundreds of thousands of dollars. Through our research and experience, we’ve learned that there are countless ways to embezzle from a dental practice. Because of this, we agree with dental fraud expert, David Harris from Prosperident, who contends that it is virtually impossible to guarantee against embezzlement in your practice. Instead, the goal is to reduce the risk of occurrence and to minimize the magnitude of loss. In effort to simplify a complex topic, I have organized this issue into three lists: 1) some basic principles and practices you should follow; 2) …

Ryan MillarDental Practice Embezzlement

How to Become a Decamillionaire Doctor, Part I

Nate Williams Leadership, Practice Management 1 Comment

Who Wants to Be a Decamillionaire? For over a century in the United States, “millionaire” has been the ultimate standard for financial accomplishment. Unfortunately, millionaire doesn’t carry the same “ring” to it as in decades past. Although it is always fun to see our clients’ net worth pass the 7-digit mark, to sustain a lifestyle that most doctors become accustomed to, they will now have to far surpass the millionaire mark. At Practice Financial Group, we have been preaching for years now that the ideal financial status is to be debt free with a $5,000,000 to $10,000,000 in retirement investments. This number excludes your practice, your building (if you own it), and your house. Does this sound lofty? Although we are optimistic by nature, we only set achievable goals. This goal of being debt free and having $5-10 million in the bank is quite achievable, but most doctors will not reach …

Nate WilliamsHow to Become a Decamillionaire Doctor, Part I

The Art of Selling Dentistry

Nate Williams General, Practice Management 1 Comment

Recently I met with a client who had an amazing experience. He lived close to a military base and years prior to our conversation he had landed a government contract to provide dental services to returned veterans. This was a lucrative contract as these vets needed a lot of dental work. Then one day he got a call from the program director; they were cutting their budget and they would no longer be sending patients to my client. Overnight almost 50% of his practice literally disappeared. Fortunately, he had been wise in his financial decisions and was able to absorb the shock without going bankrupt. But for the next several months his practice struggled. Business was slow and he was not producing. Finally, months later, his lead assistant asked to speak with him in private. She told him she knows why he is struggling and how to fix the problem. …

Nate WilliamsThe Art of Selling Dentistry

The Multi-Practice Model: An Epidemic in Dentistry

Nate Williams Practice Management, Practice Transitions 28 Comments

At PFG, we hold the view that the multi-practice model doesn’t generally work. This is despite the fact that we could earn a lot more in fees helping doctors pursue their dreams of having 3, 5 or even 10 different locations – all needing bookkeeping and tax services. And it’s time we raised our voices that the multi-practice model is an epidemic. I remember when I had my first exposure to the multi-practice business model – 2008, pre-crash. I was a young associate financial planner and I had spent several days working on the complicated financial plan for this husband and wife team in FL, who owned 3 separate practice locations. When they came in for their consult they acted like they were on top of the world, and I thought they were – Rolex watch, tan skin, designer jeans, good looking couple, they had it all. They were success …

Nate WilliamsThe Multi-Practice Model: An Epidemic in Dentistry

Why Dentists Should Have (and Max!) a 401(k) Profit Sharing Plan

Nate Williams Investments, Practice Management Leave a Comment

For years we have been advising clients to establish and make the maximum contribution to a Safe Harbor 401(k) Profit Sharing plan. Of course this advice is always tailored to each client’s specific circumstances. Most of our clients have heard this advice enough times from several different sources, that they readily agree to get on board. Recently, however, we were asked to speak at a dental society meeting to a group of 40 dentists and decided to quantify the effects of having a 401k or not. Some of the general benefits of having a 401k include: The ability to setup an automatic savings plan (this is like “auto-flossing” while you sleep). The ability to get a current-year tax deduction at a time when we reasonably think you’re in your high earning and therefore high tax bracket years. The ability to allow the money to grow tax-deferred, meaning no tax on …

Nate WilliamsWhy Dentists Should Have (and Max!) a 401(k) Profit Sharing Plan

Profitable Practice Rule #3: Avoid the Taj Mahal

Nate Williams Practice Management Leave a Comment

In this post I’d like to speak about your physical space – your office. This is a tough post to write as many of the readers have already made the decision about where to practice. I might contradict decisions you’ve made. I’m sorry for that. Even if you have already signed your lease or purchased your building, hopefully there is something here for you, or hopefully you can help someone else by passing this on. The Principle of Non Distraction Years ago I served as a missionary for my church; we had a strict dress code, which included a suit with a white shirt and tie, and to always keep our hair combed with a conservative style. I often wondered why we did this until one day I learned that the purpose was to not distract, by our appearance, from the message we had to share. If we looked sloppy …

Nate WilliamsProfitable Practice Rule #3: Avoid the Taj Mahal

Profitable Practice Rule #2: Reduce Dental Supplies Expense

Nate Williams Practice Management 2 Comments

The average dental practice has a 60% overhead, or 40% Operating Profit Margin (the percentage of money you keep after paying all operating costs of the business). This means that the average doctor keeps $.40 of every dollar he/she collects. Our clients are not average, so we’re not satisfied until we see a 50% operating profit margin or better. In our last blog post we emphasized the importance of focusing on production and all but ignoring everything else in order to increase profitability. Because most of the costs in a dental practice are fixed, this approach is critical. But there is one cost we do want you to be aware of and to focus on continually. Clinical Supplies. We tell our clients to “spend 95% of your time and energy on production (making money). Of the other 5% that you can direct towards saving money, spend 95% of that energy and …

Nate WilliamsProfitable Practice Rule #2: Reduce Dental Supplies Expense

Profitable Practice Rule #1: Focus on Production

Nate Williams Practice Management Leave a Comment

In my last blog post I addressed this question: “Why is running a profitable dental practice is so important to a good life?” If you haven’t read the post, please check it out here. I also promised that my next three blog posts would address the next logical question: How can I run a more profitable practice? There are many different answers to this question – running a small business is complicated. But over the years we have learned a lot by analyzing hundreds of practices from all over the country, and by observing the doctors who run them. Additionally, the average PFG client has an Operating Profit Margin1 of almost 10% higher than the average dental practice in America. So we know we’re learning from some of the best. So here is how: Rule #1: Focus on Production/Collections

Nate WilliamsProfitable Practice Rule #1: Focus on Production

Why is a Profitable Dental Practice Critical to a Good Life?

Nate Williams Practice Management 1 Comment

Practice Profitability – The “Why” of running a profitable practice Every day I talk to dentists all over the country. Many of them are filled with zeal for growing their practices, which is great. But when I start hearing about new buildings or satellite offices I often find myself asking, “why?” When you start adding all this mass (overhead), and finance it all with debt, most of the time what ensues is more work, more stress, more taxes, more time at the office, and less time and money for the doctor and his/her family. Why are you working so hard? So what about you? Really. Stop reading and answer the question. Why am I working so hard? We believe in work. Many of life’s greatest joys are the fruits of hard work. It takes hard work to run a business and see the profits therefrom; it takes hard work to keep yourself …

Nate WilliamsWhy is a Profitable Dental Practice Critical to a Good Life?