The most important factor influencing practice value is Profitability (also known as Net Cash Flow). Therefore, increasing productivity and improving the bottom line of your practice will not only increase your personal income but also enhance the value and marketability of your practice when the time comes to sell. Here are a few strategies that you should consider utilizing to increase production and efficiency in your dental office.

1. Increase your UCR fee schedule by 1-3% annually. If you are in-network with PPO insurance plans, periodically review these plans and submit an updated UCR fee schedule requesting a higher reimbursement rate. You may want to consider utilizing a company (i.e. Five Lakes) to assist you with doing a PPO evaluation for your office to determine which PPO plans you should add/retain/drop and negotiate more favorable fee schedules with the plans you add/retain. 

2. Offer flexible payment plans that allow patients to pay their fees over a period of time utilizing a third-party patient financing company (i.e. Care Credit), or by allowing your office to debit their credit card on a monthly basis.

3. Perform “financial surgery” on your practice to determine where you can “trim fat” and reduce overhead expenses. Compare your major overhead expenses to the following industry benchmarks and make changes as necessary to bring your expenses within the normal range:

• Staff Salaries (including benefits & payroll taxes): 25-27% of revenue
• Rent (including utilities): 6%-10% of revenue
• Lab Expenses: 6-10% of revenue
• Dental Supplies: 5-6% of revenue
• Office Supplies: 1-2% of revenue
• Advertising: 2-5% of revenue
• Total Practice Overhead: 60%

4. Consider enhancing your website (i.e. add patient testimonials and promote what differentiates you from other practices).  

5. Utilize a patient communication system for recall notices and patient newsletters that interacts with your patients via email and text messages. 

6. Increase new patient flow by routinely asking patients for referrals (e.g. “Thank you for coming in today. We appreciate having you as a patient. What can we do to get more patients like you?”). Write thank you notes and/or provide a small gift to patients who refer their friends, family, and co-workers to your practice.

7. For some practices, reputation marketing is the largest source of new patients.   Enhance your online reputation by encouraging patients to post positive reviews on Google and Yelp. There are patient communication systems, apps/plug-ins, and marketing firms that can facilitate the process of soliciting and posting positive online reviews to multiple platforms.     

8. Provide business cards for all staff members with their name/position and encourage them to hand out the cards to friends, neighbors, and others in the community. Reward your individual team members for generating new patient referrals.

9. Track where your new patients are coming from and eliminate marketing expenses that are not generating a strong ROI.

10. If you have debt on the practice, now is a good time to consider consolidating your loans at lower interest rates to lower your loan payments and re-invest the savings in marketing and updating equipment/decor.

11. Reduce disability insurance costs by extending the elimination periods and raising deductibles on your health insurance plan. 

12. As you near the end of your lease term, you may be able to renegotiate the lease rate on your office space and/or receive funds from the landlord to improve your office space, especially if you offer or agree to extend the length of your lease term.

13. Meet with your staff to solicit their ideas on how to increase new patient flow, increase practice productivity/efficiency, and reduce overhead costs. Establish daily and/or monthly production/collection goals and implement a staff bonus plan to reward your team for reaching those goals.  

14. Evaluate your team to determine if there are areas for improvement or staff changes that should be made (i.e. replacing a poor performer with a top performer).

15. Following their appointment, personally contact every patient to see how they are feeling. For new patients, mail them a handwritten note after their first visit to welcome them to the practice. 

16. Survey patients and review the results with your staff to see how you are doing in the following areas:

• Friendliness of dentist and staff
• Seeing patients promptly

• Explaining services and costs clearly 
• Providing personal attention that does not make the patient feel rushed
• Acceptance of insurance plans 
• Providing flexible financing plans 
• Sufficient appointment reminders
• The look and feel of the office
• Convenience of office hours

17. Report all cash collections and reduce writing off discretionary/personal expenses through your practice financials in the 2-3 years leading up to a practice sale. 

By implementing the above strategies and keeping a finger on the pulse of the profitability of your practice, you can rest assured that you are in the position to maximize the value of your office when the time comes to put your practice on the market.