There has been a significant increase in the number of dental practices in Australia and New Zealand over the last few years which has led to an undeniable increase in the choice patients have for where to go for their regular dental visit and dental treatment.
The increase in the number of dental practices means many dentists in New Zealand and Australia have vacant chair time of as much as 12 hours a week. The most expensive piece of equipment within a dental practice is an empty chair. According to ADA’s research, approximately one third of dentists report that they are not busy enough, and as a result, have a high amount of unused chair time. Based on ADA’s fee survey, for dental practitioners who charge by the hour, the average rate charged for service in 2016 was $435. If a dental practice has 12 hours of vacant chair time per week, they would have lost approximately $250,560 per year.
If you also consider the cost of running a practice, the consequences from 12 hours of lost revenue, would have a detrimental impact on cash flow. These mainly include overhead costs such as electricity costs, water, rental, equipment costs and staff wages.
These vacant chairs are costing practices money and are failing to bring in sufficient funding to cover the overhead costs that all dental practices incur.
What’s the solution?
Many dental practices are still engaged in the age-old price war strategy to try and attract more patients. While creating a low-price appeal may work initially, it is not a viable long-term strategy, and at the end of the day, it is actually detrimental to the profession of Dentistry as a whole. The strategy of dropping prices below costs can have a negative impact on the quality of dental treatments as well as the future growth of your dental practice.
The best way to attract new patients and maintain recall rates, while avoiding a price war is simply to offer services that are of the highest quality, while warning others of the side effects on quality that is a consequence of low prices. If you simply offer services that are better value for money, then it’s almost a guarantee that patients would rather seek you out than go to a cheap practice where they aren’t taken care of.
Another way to avoid slashing your prices to compete is to take stock of your market; do some research and see what your potential and existing customers are looking for and you will find a niche you can take advantage of.
One strategy used by Dental Practices with a full appointment book is to offer teeth whitening treatments. In some practices implementing a successful teeth whitening program has increased the practice’s revenue by 12% and eliminated vacant chair time.
Spring and summer are traditionally the seasons to promote cosmetic dental procedures at your practice; people are looking for these kinds of dental options to get ready for the seasons in the sun. However, seasonality is now less of a factor for Customers to choose when they elect to have a cosmetic dental procedure.
An effective Teeth whitening campaign commencing sooner rather than later may be the opportunity that you are looking for that will bring both new and existing patients into your practice and increase your revenue.