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What makes a dental practice financially resilient during uncertain times? Expert accountant Johnny Minford joins us to break down exactly how to protect both your income and long-term practice value.
We explore the difference between capital and income resilience—and why strong cash flow matters more than ever when inflation eats away at your savings. Johnny shares how smart appointment scheduling, strategic patient retention, and effective treatment invitations can stabilise your income without compromising care.
From associate pay structures to patient demographics, hygienist contracts to specialist referrals, this episode is packed with actionable insights. Discover how the right systems, culture, and strategy can keep your practice thriving—no matter the market.
Plus, UK dentists can now earn free verifiable CPD. Just click the link in the show notes after listening.
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Disclaimer: All content on this channel is for education purposes only and does not constitute an investment recommendation or individual financial advice. For that, you should speak to a regulated, independent professional. The value of investments and the income from them can go down as well as up, so you may get back less than you invest. The views expressed on this channel may no longer be current. The information provided is not a personal recommendation for any particular investment. Tax treatment depends on individual circumstances and all tax rules may change in the future. If you are unsure about the suitability of an investment, you should speak to a regulated, inde
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Dr James (00:00):
Today we're talking dental practice and associate
resilience, and what we mean bythat is what you can do to stay
financially robust even when themarkets are not that good.
I'm joined by expert accountantMr Johnny Minford.
We're going to be going throughthe ins and outs of everything
that you can do to put the powerin your hands to stay safe and
stay profitable duringchallenging financial times.
(00:22):
I'm also happy to share thatthere is free verifiable CPD
associated with this podcastepisode.
Whenever you finish the episode, all you have to do is click
the link in the podcastdescription.
It'll take you right throughthe Dentists Who Invest website.
You'll be able to complete ashort questionnaire and, once
passed, you fill in yourreflections and we'll go ahead
and email over to you yourverifiable CPD certificate,
(00:45):
which is entirely free.
What that means is this podcastepisode will be able to
contribute towards yourverifiable CPD hours during this
learning cycle right.
Johnny (00:58):
Well, I think what we're going to talk about today is is
, uh, the factors that make adental practice more resilient,
yeah or not?
Dr James (01:08):
yeah, that's the thing , because I think resilience is
a good thing resilience isabsolutely a good thing,
especially when people getnervous because there is
economic gloom.
Johnny (01:21):
Insecurity, James, is the word you're looking for.
Insecurity, there we go, andinstability, and if there ever
was a time, this is it.
This is it.
But the first thing, if we'relooking at a dental practice
resilience the first thing wehave to have a look at is what
(01:43):
do we mean by the wordresilience?
Is it resilience in capitalvalue In other words, we're
trying to do something thatmakes a practice look resilient
to someone else if it comes tosale or is it resilience where
we build in an income streamwhich is going to be a long-term
(02:07):
thing, so that practice cancarry on, and carry on month
after month, year after year?
And the two are slightlydifferent.
The good news is there'sprobably a lot of the same sort
of things.
That are the factors in that um, but how you deal with them,
(02:28):
how you put them into thepractice, is slightly different
depending on whether you'relooking for a capital resilience
or an income resilience whatwas the first one?
Dr James (02:39):
what was the first one ?
Johnny (02:41):
the capital resilience right, okay, yeah, so it's the
capital value, trying to makethat look sensible and obviously
to somebody else, becauseyou're doing that for a reason
to sell it.
Dr James (02:56):
But I like this little distinction you were making,
because I was kind of ponderingthis the other day.
This was like a random showerthought I don't know where I was
at the time, but I was likewhen inflation is really high
and you have your wealth storedas cash capital, resilience goes
out the window.
But what's the one thing thatprotects you cash flow right in
that, in that situation?
Absolutely you have to have agood margin to protect it, and
(03:18):
inflation has been kind of high.
Johnny (03:19):
The last bit absolutely, and I think that's why the uh,
the values of dental practicesare seem to be higher for those
practices which have a regularguaranteed income stream, which
is plan income or, um, nhsincome, and that has supported
(03:42):
and kept those values high,which is not always what the
social media would want you tobelieve, but that's the reality
and it's that strength of incomestream which is the issue.
One thing I would also say onthis is what I'll talk about and
what I'll say.
It doesn't matter whetheryou're an NHS practice or
(04:05):
private practice or whatever mixbetween the two.
The same concepts apply.
The only difference is, witheither NHS or private, you have
different levers that you canpull.
Like, for example, in a privatepractice, if the answer to your
(04:26):
problem is stick the fees up,you can do it.
If you're an NHS practice, youcan't.
So that's a done deal, but itdoesn't mean that one thing's
better than the other.
Some of the things that we'retalking about just shows where
we are and which levers andwhich tools we use are just
(04:47):
slightly different in each.
Well, we probably won't go intothat today.
So I would say that there aretwo main factors that that
affect the resilience.
The one is the treatments thatare offered now.
I'm going to talk about thatlater, I'm not going to touch
(05:10):
that just now.
The other factor that is comesinto this is patience, and when
I say about the patients,there's a truism here that the
more patients that you've got,the greater the number of people
(05:31):
you want to buy from that arein your shop.
So more patients, more mouths,more teeth, the more you've got
in the shop, the more optionsthat you have now.
They may not all be in the shopwanting to buy, they may not be
in buying mode, but at leastthey're there, they're in your
(05:55):
shop, not somebody else's shop,and you have the options then to
try and work with that and Iwith that, and I think that
makes a certain amount of sense.
So, taking a step beyond that,we've got to look at the, I
(06:15):
suppose, on a sales point ofview.
Your customer, who is yourcustomer, isn't the guy that
walks in through the door andsays I've got toothache.
Your customer are probablyother dental practices from whom
(06:36):
you are trying to get areferral, and that's a different
sort of marketplace and adifferent sort of thing that you
need to do to get thosecustomers into your shop and get
those people into buying.
If you're a GDP practice and itis the public that you're
(06:59):
dealing with, direct, thenthat's something else, that's
something a little bit different.
You have to stimulate them tobuy somehow.
You need to stimulate whoyou've got on your list to buy,
and that does apply whetheryou're a referral practice, a
specialist practice, a generaldental practice, whatever it
(07:24):
might be.
You need to stimulate them, getthem through.
Now, however you look at this,the way I see it, you've got two
ways, main ways, to get yourpatients into your shop, into
the chair or into the buyingroom.
(07:45):
The first one is through habit.
So if they are in the habit ofcoming to you let's say, when
you had a six-monthly checkup,or you have six-monthly checkup
and three-monthly hygienistwhatever If you've got them in
the habit of coming in everythree months six-monthly checkup
and three-monthly hygienistwhatever If you've got them in
(08:06):
the habit of coming in everythree months, every six months,
every year, however it takesfrom, whatever your referral
process is, if they're in thehabit, then they're connected
with you and they are going tocome to your practice at some
point on a regular basis.
(08:26):
That's easy for you becausethose are, those are.
Those are regular patients.
You don't have to stimulatethem too much.
You might have to stimulatethem to come a little bit more,
but they're already there withyou and they're not going
somewhere else.
I think that's one part ofgetting the patients in.
(08:53):
The other main way to get themin is by some sort of invitation
.
So whether that's targetedrecalls, like I'm saying, if
they don't come in for hygiene,you're going to target them to
say, yeah, come in for hygieneevery three months, every four
months, whatever it might be.
So you're targeting with aninvitation.
That's going to come down towhat them trusting you as well.
(09:21):
When you say to them, as theirdentist, dentist, come in every
three months for hygiene,they're going to do what you
tell them because they trust you.
Then that flows to other typesof oral care, whereas you invite
them in for straightening,whitening, some sort of smile
(09:43):
makeover, cancer check, whateverit might be.
But when you reach out to themwith that invitation, they
respond to it.
So that element of keeping trustbetween you and your patient is
quite an important way to getthem coming to the door, getting
(10:06):
them into your reception andgetting them into your chair
without too much difficulty, orless difficulty if it's somebody
completely new.
Now the key to all of that, ofcourse, is knowing your patient
and having that connection withthe patient and having that um,
(10:30):
that, that that knowledge aboutwho they are, what, what your
patient base looks like, whetheryou've got a lot of you know
80% of what you do is band oneNHS treatment.
You know that's a differentsort of marketplace, a different
sort of patient base than aspecialist that brings in half
(10:57):
their work, half their income iscoming in from, say, implants
or Invisalign or something likethat implants or Invisalign or
something like that.
So knowing the patient andknowing what stimulates them is
the key to this Knowing whatthey want to buy.
Knowing what they want to buy.
(11:18):
But the key on this is keepingthe surgery space that you have
used.
That comes down to you as theowner, but it also comes down to
your other clinicians that youhave In the practice.
You'll have associates, you mayhave hygiene, you may have
(11:44):
therapists, and it's coming downto using those other clinicians
.
Dr James (11:49):
Can I ask a really quick question on this exact
thing that you're talking about,because it'd be interesting to
get your take?
Do you know in terms of howbooked up a dental practice
should be, as in the patientcomes on the first day of the
month, come and see the dentist,they have a checkup and they
(12:10):
need to come back for a fill-inor a crown?
Let's say how some people, somepeople uh, have like a six to
eight week waiting list beforethey can come back.
They have a six to eight weekwait before that patient can be
booked back in and they're likethat's normal and for some
dentists is next week and theythink that's normal.
Right, in your experience,where's the sweet spot?
(12:30):
What's the perfect?
I call it a waiting list.
It's not really a waiting listbut I know exactly what you mean
waiting time?
Johnny (12:37):
I know exactly what you mean.
Um, I think the sweet spot candepend on your patient base.
If the patients are used towaiting for six or eight weeks,
then you can get away with it.
However, I would say that yourwaiting time should be a lot
(13:00):
less than that, because ifsomeone has a problem with their
teeth, if it's a problem,you're going to fit them in,
aren't you?
And you need to keep some spacein your diary clear for such as
emergencies or things thataren't really emergencies, but
it would be better to be seen.
(13:21):
But I think that should apply asmuch as you can with a lot of
the treatments, because whensomeone comes and they sit down
with you and they say I've got aproblem, that's a stress
purchase, and a stress purchaseis always, always dealt with as
(13:45):
soon as you can, because thatstress turns into something
different after a few weeks,that the stress of patient fees
in a lot of cases getstransferred to the person who
can actually help them and whyyou're not helping them.
(14:08):
So that stress thing needs tobe dealt with straight away.
If it's something where it's anelective treatment, then that's
the sort of thing you can pushoff a little bit more.
But pushing it off means thatthe potential patient has enough
(14:30):
time to change their mind.
There's enough time to forgetwhat the benefit is, because if
you're selling an electivetreatment, it means you've sold
a benefit, and that benefit hasto still be fresh in the
patient's mind, or else theydon't appreciate it enough.
(14:51):
Now you link that up withpricing.
And again, if you're going tosell somebody a pretty good car,
let's say you can't sell them agood car and say this is a
fantastic car.
Keep telling them that for sixmonths, because when the time of
six months is up, they're fedup with that and they don't have
(15:16):
the same view of the cost ofthat after that period of time.
So to me I think, organizingthe diary, organizing the
clinician element of it, itshould be less than eight weeks.
Really.
(15:37):
You could go, you could go outmore than more than one week,
two weeks, if the practice cando it.
You may not have the personnelit's so.
Dr James (15:46):
It's so fascinating because there's no listen.
There's no listen.
There's no rule book on thisstuff.
Right, that would be nice, butit's one.
I've heard clinicians say threemonths is normal.
I've heard clinicians say nextweek is normal.
I think again, listen, there'sno right or wrong answer.
But if I was to lick my fingerand put it in there two, three
weeks, I reckon something likethat, because then they start to
(16:07):
get the especially in there two, three weeks, I reckon
something like that, becausethen they start to get the,
especially the kind of, uh, youknow, as you say, it depends on
the patient.
Say, you've got the instagrampatients who want invisalign.
They want to start yesterday,some of them.
Do you know what I mean?
Um, and as you say, ifsomeone's got by the way, that
two, three weeks, I said was forelective treatment, pain
treatment, it's, it's yesterday,if it can be.
Do you know?
Know what I mean?
It's as soon as it can.
(16:27):
But no, I just wanted to.
I deliberately didn't want tosay my, what I believed my
answer was because I wanted tohear your take on that.
But anyway, I didn't mean to.
Johnny (16:39):
I think it's right because that is a sales thing,
that is a marketing thing and adental practice.
When you're selling what couldbe high-ticket items to people,
it fits the same bill as if youwere selling something else.
It's going to cost you a fewhundred pounds, several hundred
(17:01):
pounds, whatever it might be.
You can't drag it on becausethat's not a good marketing.
You sell it and you sell themthe solution.
And once you've done it, thenyou're going to bill them at the
point of doing it, unless youtake the money up front, and
(17:22):
there's an old professionaladage that says you bill them
when the tears of gratitude arestill in their eyes I've heard a
variation on that pay the paythe worker, while the beads of
sweat are still on theirforehead.
Dr James (17:38):
So I guess it.
I guess it works both ways.
The principle, is absolutelythe same they're billing the
patients as the patients aregetting emotional for the great
treatment, but they're givingthe associate share the
straightaway right principles,Something like that.
Anyway, something like that.
I'm being slightly facetious,but you know what I mean.
I know exactly what you mean,James.
Johnny (17:56):
I think that is something that we need to do,
but a lot of that is to keepyour clinicians happy and keep
them focused and actually usethat chair side time as best you
can correct.
Dr James (18:15):
Anyway, that actually brings us full circle, because
you were just talking aboutassociates before I sidetracked
the conversation you will ask mewhat percentage your associates
get paid you know what's funny?
Before we shot this podcast, Isaid to Johnny Johnny, one thing
we have to talk about becausethere is a lot of debate is one
(18:38):
word you could use on socialmedia at the minute about
associate splits and, fair tosay, it is a divisive topic.
So before I pulled us on towaiting times, we were just
talking about associates, whichsegues nicely into associate
splits.
Johnny, what's your take onthis?
(18:58):
What's your take on this?
Johnny (19:01):
Right, I wish there was a single answer, but if you were
to say to me what does itdepend on?
I think, more than anything, itdepends on the location.
Dr James (19:17):
Not always Was that location or vocation Location
Location Actually, that's aninteresting thing you should say
.
Johnny (19:25):
But vocation as well.
But location, I I think, is thething.
If you've got a practice in anarea where you can attract
associates and so on, peoplewill try and tend to bring the
bring the uh percentage thatthey get paid down or the UDA
(19:48):
rate down Makes sense.
That's not always a good thing,because your patient base likes
to see the same dentist, theylike to see the same person,
they like a certain amount ofconsistency.
And also, as time goes on andwe found this after COVID if you
(20:09):
treat your team badly and youscrew them to the floor every
chance you get, after two orthree years you become known for
that and it's difficult then tostart to attract the people.
And then you start to worrywell, why am I not getting
associates?
Why can't I get hygienists ortherapists?
(20:31):
Well, actually, the word's outthere on the marketplace.
And for a dentist to sort ofsay well, that's not true,
believe me, it is true, the wordgets around.
So there is an element ofbalance that you need to do and
you can pay people less.
You can pay people less andtreat them well and have them
(20:55):
still appreciate you and want towork for you, because sometimes
practice hasn't got the moneyto pay the big bucks.
Sometimes the practice is in aplace or in a location that it
can't do, that it hasn't gotthat capability.
(21:16):
But sometimes for people, thisis where we come to vocation.
Sometimes you have people and,whether they are hygienists or
nurses or associates or whateverthey might be, sometimes they
actually like working in thatpractice.
For those patients, for thatowner, in that particular way,
(21:38):
it's a nice place to work.
So it's not always about money.
It can be about lifestyle, itcan be what you get out of it,
not just about money.
So you've got that to factor inas well.
The higher rates will oftenfollow rural areas because the
(22:05):
owners haven't always got achoice.
They've got to entice peopleright, but there it comes down
again to what I'm saying abouttreating people well.
This is a two-way street.
The associates have tounderstand and get where the
owner is and the burden that theowner is carrying, as well as
(22:30):
the associate.
So this happens both ways and Ithink you can get a balance
where everybody's happy at whatthey get paid for the lifestyle
that they have in thatparticular location.
And, James, I think I'vementioned to you before I know,
under the NASDAQ benchmarkingstatistics that we did for 2024,
(22:56):
we find that of the sample thatwe had, it's the practices in
central London who actuallyearned the less for their owners
, the least for their owners.
Dr James (23:13):
Crazy, because that's where the lowest splits are as
well, right.
Johnny (23:17):
It is, it is.
And on that you will get ownerstrying to start their
associates at a relatively lowpercentage rate, let's say 35
for example, but then the morethey do, the more they get paid.
So they go up in bandings.
(23:38):
Um, once they get past acertain level which the owner
can calculate pays for hisoverheads, then the associate
actually can get up to 55% and60% over that if they're high
grocers, if they're high earners, because in that sort of thing
(23:59):
everybody wins.
So the owner gets more workcoming through the door and the
associates debts pay for it,whereas if you get someone
coming in and doesn't do a fatlot, they're taking up surgery
space and that surgery spacecould be used by someone who
(24:20):
works faster, who works better.
And you know this comes down tothe.
The owner, the proprietor istrying to do this to build their
practice and I think that'ssomething sometimes the
associates don't always realize,sometimes the proprietors don't
(24:41):
always realize it either.
Dr James (24:43):
I got, I was just going to say I got love for both
sides of the debate.
Yeah, because Because theprinciples you know.
It's not an easy place to be inbusiness where you're losing
money and you're working 16hours a day, Whereas the
associates how it can comeacross to them is that the
(25:03):
principle is overly moneyorientated, Whereas in reality
they really don't know what'sgoing on behind the scenes.
So I've got empathy for bothsides.
I really do, and I feel like itstarts.
Better handling of thatsituation starts with empathy.
Johnny (25:21):
I agree with you.
I agree, and there's nosubstitute for actually working
as a team and having anunderstanding, rather than
somebody turning up and saying,right, I'm here and I'll start
at five past nine and finish itfive to three and I'm off,
where's my money?
Dr James (25:42):
without actually thinking of how that fits into
the bigger picture and you knowthe curious thing about
associates and principals bothoften think that they've got the
better deal, because theassociates tend to think that
the business owners are all inmoney, and it's not.
By the time everybody else ispaid and the debt serviced and
the overheads are paid for.
(26:04):
It's not always the case, butanyway, if anybody wants to see
some more interesting debate onthis topic, that johnny and I
are talking about some real rawand ready opinions, I think, is
one way of saying it.
Uh, have a look at the denniswho invest facebook group, some
of the posts that are on therefor the moment.
And, as I say, we create thesepodcasts to help everybody
(26:25):
understand and be moresympathetic to each other's
positions.
Any more to say on the numbersfront, or do you think that's?
Johnny (26:33):
about it.
Looking at that patient side ofthings, I think that, and the
diary management, and onceyou've got the patients through
the door, it's getting them inthe right chair in front of the
right clinician, whether it's atherapist or an associate or the
(26:56):
owner that's important Now,that organization of patients
and so on.
That, to me, is the end of it,of creating resilience we talked
about in a dental practice,because that efficiency
effectively is resilience andwhether you're trying to build a
(27:17):
practice for sale or build apractice that's going to give
you a steady income as an owner,a steady income as an owner
month after month and year afteryear, it's the same thing.
And if something happens, likeCOVID or something, or something
happens to the practice, thenyou've got a little bit of slack
(27:41):
if you're running the place.
Efficiency, that is importantto do that.
Now.
We haven't talked, James, aboutum, new patients, um, or new
work, because that is somethingwhich is is the other side of
the patient side.
Now, if you are a specialist,then your patient, your, as it
(28:06):
were, is a different person thanthe patients that you're seeing
.
So that's something that, as aspecialist, as a referral
practice, you've got to keepgoing, because if you don't keep
it going, there'll be somebodyelse out in the marketplace that
will be wanting to speak toyour referral sources, and
(28:28):
that's something that isimportant and that's a
continuous thing that you haveto do, that you have to build
into the uh, into the how theworkload flows month after month
and, from a resilience point ofview, you have that regular
flow from your regular peopleplus others.
(28:50):
That's important.
That gives you the strengthgoing forward.
If you're a general practice theGDP then that's more about well
, two things really.
It's about your presence in thelocal market, rather than being
(29:11):
hidden away down an alley thatnobody knows you're there apart
from your patients.
You need to have that presenceto say I'm here.
That comes back to James, towhat you said about when can I
be seen by my dentist.
And if you turn up to a newpractice who's looking for new
patients and you're told, yeah,well, we can see you in four
(29:33):
months, you've just lost thatpatient, that potential new
patient.
It's not going to happen.
That's important.
But that and turning yourexisting patients into
ambassadors for you, that'simportant.
That's really important to keepthat flow of new people coming
(29:57):
through, because you are goingto get people who want to move
away get come back to locationagain here.
If you're in a large housingestate where you've got a churn
of families in and out all thetime, you've got something
naturally which is happening.
If you're in a rural markettown or something, you don't
(30:19):
have that sort of churn, you'vegot to keep replacing your
patients because some of themare going to die and you can't
do much about that well, I mean,it's morbid to talk about,
isn't it?
Dr James (30:34):
but I guess it's it's well, it's completely true.
I mean, I think one sort oftakeaway that I'm gathering from
what you're saying is that Ithink that for some people,
safety is seen in staying thesame and stagnation, but
actually that has inherentdanger too.
So there has to be a little bitof liquidity in the patients,
liquidity in the business interms of cash flow.
(30:55):
That actually helps with theresilience side of things.
Johnny (31:00):
No, you're absolutely right, James.
But the other factor, apartfrom patients, is the treatments
that you give them.
You know, with a specialistoffering specialisms, now you
can have a specialist who takesreferrals only and simply does
(31:20):
the referrals, say root canals,somebody who specializes in endo
and doesn't have their patients, they take patients from
somewhere else, have theirpatients, they take patients
from somewhere else.
Um, that is gotta keep thatgoing because you've got to keep
your referral sources running.
If you've got specialists in ageneral practice, that's a
(31:44):
slightly different sort of thingbecause you're marketing them
to the general patient base aswell as potentially to other
referral practices, otherreferral sources.
For that sort of work.
The downside is you've got tokeep doing it and it's a more
(32:06):
personal thing so it's noteasily as easily transferable on
sale and people know that.
Buyers know that.
And for specialist treatmentsthe number of buyers is always
reduced because not everybodydoes endo or not everybody does
(32:27):
Invisalign and nor do they wantto.
So your number of buyers isdown.
But the upside is it can bemore profitable for you if you
are working on that, sellingthat sort of treatment to your
patient not always so.
(32:48):
The measure of that is if you'remeasuring KPIs.
The KPIs have to be measuredafter the direct costs because a
lot of specialisms carry quitea heavy direct cost with them
and it's easy to look at the topline what's coming in,
(33:10):
particularly if you get paid upfront.
Um, and it's easy to look at thetop line of what's coming in,
particularly if you get paid upfront.
It's easy to look at it and saythis is fantastic, without
actually knowing there'sactually quite a lot of work to
be done and quite a lot of costto follow down the track a
little bit.
Those KPIs have got to bevalued.
(33:33):
It's like dealing with any ofthe patients.
You've got to look at the KPIper hour and there's also if
you're spacing your surgeries atthe premium, you've got to look
at the KPI per square meter,because sometimes an associate
(33:54):
who comes in, for example, anddoes half day and then the
practice is empty for the otherhalf day, sometimes they can
actually make less profit forthe owner than if you had, say,
a hygienist, for example, who isin there working all day, or
(34:15):
two hygienists working fillingthat same space 10 hours a day.
So you've got to look at thosethings in the particular
practice as well and I thinkthat's quite interesting.
Dr James (34:28):
Question Johnny and this is a little niche but still
very useful Hygienistremuneration salaried or split?
Johnny (34:40):
The hygienist the remuneration, depending if it's
a salary or if it'sself-employed.
Is that what you're asking?
Dr James (34:50):
Yeah, should you salary your staff, your
hygienist, because I've seenpeople.
This is another thing thatpeople argue the hell over.
Johnny (34:57):
I'd be interested to hear your take Okay.
The person who decides whetherthey're salaried or
self-employed isn't you or me,it's the taxman.
And the taxman has got certainwhat we call badges of
self-employment and badges ofemployment that they will apply
(35:23):
in this sort of situation.
And the fact this is not adental thing, this is right
across business, and if you havethe badges of self-employment,
you can be self-employed.
Dr James (35:37):
If you don't, you are forced to be employed and your
own, the owner of the practice,has to apply that so what you're
saying is that when peopledebate this because I've seen
people you know, I don't want toname names I've seen people say
on facebook I pay my, I pay myhygienist a wage.
(35:58):
That that's really ropeyterritory, because unless
there's anything thatdistinguishes their hygienists
from their associates, they'regetting in a murky territory.
Is that, have I understood?
Johnny (36:07):
that is that that is correct, and bear in mind that
it's the proprietor that has topick up the tab on this if it
goes wrong, not the hygienist,because you are then into the
world of employment law, where,if you are deemed to be employed
, then your deemed employer isresponsible for deducting the
(36:30):
amount of tax and nationalinsurance responsible for
deducting the amount of tax andnational insurance and if they
have treated you asself-employed and they have not
deducted tax and nationalinsurance as employed, it's up
to them to sort it out, not upto the hygienist.
Right, wow, which is frightening, which is why an awful lot of
(36:50):
big places like hospitals and soon and so on.
You don't have this argumentyou're employed, end off unless
you can come up with the badgesof one.
They're not badges ofemployment, self-employment.
There are a number of thingswhich fit that, but I suspect
that that is a different podcast, because we could go on and on
(37:13):
on that one as to what to do tobring yourself into the realms
of self-employment, becauseself-employment is better for
the hygienist or the therapistor the associates, and it's also
better for the proprietor andit's also better for the
(37:34):
industry.
The person that it's not betterfor is the taxman.
So organizing your affairs tohave these badges of
self-employment is a reallypositive thing to do for
everyone, but that's a differentpodcast, James.
Dr James (37:54):
It sounds like it the debate's almost settled there.
In that case, it's less a moneything, more a staying on the
right side of the law thing andnot creating some sort of huge
tax liability.
Johnny (38:09):
There's times to push the boundaries.
Those sort of areas areprobably not them, because it's
pretty straightforward.
As for the tax map, it's prettystraightforward, so and unless
you jump through all the hoopsall the time, you've got a
(38:33):
problem.
So that's the thing there.
But coming back to treatmentsand where treatments are a
factor, if you're a generaldental practice, we talked
earlier about knowing yourpatient and knowing your patient
base.
We talked earlier about knowingyour patient and knowing your
(38:54):
patient base.
Being able to see whattreatments you can market across
your patient base isinteresting and important to do
that Because you can't go into apractice where the average age
(39:17):
is 65 and start trying to say,well, I'm going to sell
everybody Invisalign Not goingto work.
Similarly, there's the otherside of the coin, and that's
with all younger people.
There's certain things you canmarket to them.
There's other things that youcan't.
You're wasting your time.
So you've got to know yourpatient base.
If you were a hundred percentNHS practice, you've got a
(39:40):
pretty obvious thing where youtake your band one, two and
three treatments and you splitit up and see how many people
are in each of those bands whereyou what sort of treatments you
give every to everyone, uh, ina 12-month period, and that
gives you an idea of just whatyou might be able to sell, maybe
(40:01):
as private, maybe on top ifyou're a private practice um, I
know sometimes we do in ourpractice.
We're looking at practice andwe would split, not a band, one,
two and three, but we wouldhave, say, five tiers of private
(40:21):
work.
So our tier one is pretty basicexam scale and polish through
to tier five it's being somepretty heavy, like an implant or
something like that, and yousplit them all in between.
Then you can start sayingwhether there's an average cost
or an average price for each ofthose types of things.
(40:42):
Also, you've got to look at thetime it takes to deliver it,
because there's no point ofhaving a super-duper big-ticket
item that takes you five hoursto deal with, whereas you could
have something very simple butyou can churn out 50 of them at
(41:04):
the same time.
This is going to take youhaving the big-ticket item and
give you less stress.
We've also got to look at theclinicians.
Come back to the clinicians.
Not every clinician wants to doa heavy, heavy treatment every
hour of the day.
Sometimes they actually want tohave a couple of hours where
(41:26):
some pretty easy work to be done, and you've got to have that
mix depending on the patientbase and the clinicians and, of
course, trying to maneuver thatas best you can into your diary,
the diary management.
But that's the other side oftrying to give a resilience to
(41:49):
the practice.
Give a resilience to yourpractice whether you're trying
to sell it or whether you'retrying to create an income
stream for it.
You can't move everything downto band one or tier one and
think that that's going to workfor you, because a lot of your
patients actually want someextras.
They want something different.
(42:10):
You have to be open to that orelse your patients are going to
drift away.
So you can try and maneuver tochange the types of treatments
delivered and something which ismore profitable or something
which is more enjoyable for thedentist that's important.
(42:32):
So the resilience of a dentalpractice, it's not just
something for a practice, anobjective practice, an object.
It changes for everything.
It has to work for you, eitheras the associate or as the owner
, and it has to base on yourgoals, not just what some sort
(42:54):
of offered loss is or what somesort of objective is that comes
from somewhere else.
Today we're talking dental practice and associate
resilience, and what we mean bythat is what you can do to stay
financially robust even when themarkets are not that good.
I'm joined by expert accountantMr Johnny Minford.
We're going to be going throughthe ins and outs of everything
that you can do to put the powerin your hands to stay safe and
stay profitable duringchallenging financial times.
(00:22):
I'm also happy to share thatthere is free verifiable CPD
associated with this podcastepisode.
Whenever you finish the episode, all you have to do is click
the link in the podcastdescription.
It'll take you right throughthe Dentists Who Invest website.
You'll be able to complete ashort questionnaire and, once
passed, you fill in yourreflections and we'll go ahead
and email over to you yourverifiable CPD certificate,
(00:45):
which is entirely free.
What that means is this podcastepisode will be able to
contribute towards yourverifiable CPD hours during this
learning cycle right.
Johnny (00:58):
Well, I think what we're going to talk about today is is
, uh, the factors that make adental practice more resilient,
yeah or not?
Dr James (01:08):
yeah, that's the thing , because I think resilience is
a good thing resilience isabsolutely a good thing,
especially when people getnervous because there is
economic gloom.
Johnny (01:21):
Insecurity, James, is the word you're looking for.
Insecurity, there we go, andinstability, and if there ever
was a time, this is it.
This is it.
But the first thing, if we'relooking at a dental practice
resilience the first thing wehave to have a look at is what
(01:43):
do we mean by the wordresilience?
Is it resilience in capitalvalue In other words, we're
trying to do something thatmakes a practice look resilient
to someone else if it comes tosale or is it resilience where
we build in an income streamwhich is going to be a long-term
(02:07):
thing, so that practice cancarry on, and carry on month
after month, year after year?
And the two are slightlydifferent.
The good news is there'sprobably a lot of the same sort
of things.
That are the factors in that um, but how you deal with them,
(02:28):
how you put them into thepractice, is slightly different
depending on whether you'relooking for a capital resilience
or an income resilience whatwas the first one?
Dr James (02:39):
what was the first one ?
Johnny (02:41):
the capital resilience right, okay, yeah, so it's the
capital value, trying to makethat look sensible and obviously
to somebody else, becauseyou're doing that for a reason
to sell it.
Dr James (02:56):
But I like this little distinction you were making,
because I was kind of ponderingthis the other day.
This was like a random showerthought I don't know where I was
at the time, but I was likewhen inflation is really high
and you have your wealth storedas cash capital, resilience goes
out the window.
But what's the one thing thatprotects you cash flow right in
that, in that situation?
Absolutely you have to have agood margin to protect it, and
(03:18):
inflation has been kind of high.
Johnny (03:19):
The last bit absolutely, and I think that's why the uh,
the values of dental practicesare seem to be higher for those
practices which have a regularguaranteed income stream, which
is plan income or, um, nhsincome, and that has supported
(03:42):
and kept those values high,which is not always what the
social media would want you tobelieve, but that's the reality
and it's that strength of incomestream which is the issue.
One thing I would also say onthis is what I'll talk about and
what I'll say.
It doesn't matter whetheryou're an NHS practice or
(04:05):
private practice or whatever mixbetween the two.
The same concepts apply.
The only difference is, witheither NHS or private, you have
different levers that you canpull.
Like, for example, in a privatepractice, if the answer to your
(04:26):
problem is stick the fees up,you can do it.
If you're an NHS practice, youcan't.
So that's a done deal, but itdoesn't mean that one thing's
better than the other.
Some of the things that we'retalking about just shows where
we are and which levers andwhich tools we use are just
(04:47):
slightly different in each.
Well, we probably won't go intothat today.
So I would say that there aretwo main factors that that
affect the resilience.
The one is the treatments thatare offered now.
I'm going to talk about thatlater, I'm not going to touch
(05:10):
that just now.
The other factor that is comesinto this is patience, and when
I say about the patients,there's a truism here that the
more patients that you've got,the greater the number of people
(05:31):
you want to buy from that arein your shop.
So more patients, more mouths,more teeth, the more you've got
in the shop, the more optionsthat you have now.
They may not all be in the shopwanting to buy, they may not be
in buying mode, but at leastthey're there, they're in your
(05:55):
shop, not somebody else's shop,and you have the options then to
try and work with that and Iwith that, and I think that
makes a certain amount of sense.
So, taking a step beyond that,we've got to look at the, I
(06:15):
suppose, on a sales point ofview.
Your customer, who is yourcustomer, isn't the guy that
walks in through the door andsays I've got toothache.
Your customer are probablyother dental practices from whom
(06:36):
you are trying to get areferral, and that's a different
sort of marketplace and adifferent sort of thing that you
need to do to get thosecustomers into your shop and get
those people into buying.
If you're a GDP practice and itis the public that you're
(06:59):
dealing with, direct, thenthat's something else, that's
something a little bit different.
You have to stimulate them tobuy somehow.
You need to stimulate whoyou've got on your list to buy,
and that does apply whetheryou're a referral practice, a
specialist practice, a generaldental practice, whatever it
(07:24):
might be.
You need to stimulate them, getthem through.
Now, however you look at this,the way I see it, you've got two
ways, main ways, to get yourpatients into your shop, into
the chair or into the buyingroom.
(07:45):
The first one is through habit.
So if they are in the habit ofcoming to you let's say, when
you had a six-monthly checkup,or you have six-monthly checkup
and three-monthly hygienistwhatever If you've got them in
the habit of coming in everythree months six-monthly checkup
and three-monthly hygienistwhatever If you've got them in
(08:06):
the habit of coming in everythree months, every six months,
every year, however it takesfrom, whatever your referral
process is, if they're in thehabit, then they're connected
with you and they are going tocome to your practice at some
point on a regular basis.
(08:26):
That's easy for you becausethose are, those are.
Those are regular patients.
You don't have to stimulatethem too much.
You might have to stimulatethem to come a little bit more,
but they're already there withyou and they're not going
somewhere else.
I think that's one part ofgetting the patients in.
(08:53):
The other main way to get themin is by some sort of invitation
.
So whether that's targetedrecalls, like I'm saying, if
they don't come in for hygiene,you're going to target them to
say, yeah, come in for hygieneevery three months, every four
months, whatever it might be.
So you're targeting with aninvitation.
That's going to come down towhat them trusting you as well.
(09:21):
When you say to them, as theirdentist, dentist, come in every
three months for hygiene,they're going to do what you
tell them because they trust you.
Then that flows to other typesof oral care, whereas you invite
them in for straightening,whitening, some sort of smile
(09:43):
makeover, cancer check, whateverit might be.
But when you reach out to themwith that invitation, they
respond to it.
So that element of keeping trustbetween you and your patient is
quite an important way to getthem coming to the door, getting
(10:06):
them into your reception andgetting them into your chair
without too much difficulty, orless difficulty if it's somebody
completely new.
Now the key to all of that, ofcourse, is knowing your patient
and having that connection withthe patient and having that um,
(10:30):
that, that that knowledge aboutwho they are, what, what your
patient base looks like, whetheryou've got a lot of you know
80% of what you do is band oneNHS treatment.
You know that's a differentsort of marketplace, a different
sort of patient base than aspecialist that brings in half
(10:57):
their work, half their income iscoming in from, say, implants
or Invisalign or something likethat implants or Invisalign or
something like that.
So knowing the patient andknowing what stimulates them is
the key to this Knowing whatthey want to buy.
Knowing what they want to buy.
(11:18):
But the key on this is keepingthe surgery space that you have
used.
That comes down to you as theowner, but it also comes down to
your other clinicians that youhave In the practice.
You'll have associates, you mayhave hygiene, you may have
(11:44):
therapists, and it's coming downto using those other clinicians
.
Dr James (11:49):
Can I ask a really quick question on this exact
thing that you're talking about,because it'd be interesting to
get your take?
Do you know in terms of howbooked up a dental practice
should be, as in the patientcomes on the first day of the
month, come and see the dentist,they have a checkup and they
(12:10):
need to come back for a fill-inor a crown?
Let's say how some people, somepeople uh, have like a six to
eight week waiting list beforethey can come back.
They have a six to eight weekwait before that patient can be
booked back in and they're likethat's normal and for some
dentists is next week and theythink that's normal.
Right, in your experience,where's the sweet spot?
(12:30):
What's the perfect?
I call it a waiting list.
It's not really a waiting listbut I know exactly what you mean
waiting time?
Johnny (12:37):
I know exactly what you mean.
Um, I think the sweet spot candepend on your patient base.
If the patients are used towaiting for six or eight weeks,
then you can get away with it.
However, I would say that yourwaiting time should be a lot
(13:00):
less than that, because ifsomeone has a problem with their
teeth, if it's a problem,you're going to fit them in,
aren't you?
And you need to keep some spacein your diary clear for such as
emergencies or things thataren't really emergencies, but
it would be better to be seen.
(13:21):
But I think that should apply asmuch as you can with a lot of
the treatments, because whensomeone comes and they sit down
with you and they say I've got aproblem, that's a stress
purchase, and a stress purchaseis always, always dealt with as
(13:45):
soon as you can, because thatstress turns into something
different after a few weeks,that the stress of patient fees
in a lot of cases getstransferred to the person who
can actually help them and whyyou're not helping them.
(14:08):
So that stress thing needs tobe dealt with straight away.
If it's something where it's anelective treatment, then that's
the sort of thing you can pushoff a little bit more.
But pushing it off means thatthe potential patient has enough
(14:30):
time to change their mind.
There's enough time to forgetwhat the benefit is, because if
you're selling an electivetreatment, it means you've sold
a benefit, and that benefit hasto still be fresh in the
patient's mind, or else theydon't appreciate it enough.
(14:51):
Now you link that up withpricing.
And again, if you're going tosell somebody a pretty good car,
let's say you can't sell them agood car and say this is a
fantastic car.
Keep telling them that for sixmonths, because when the time of
six months is up, they're fedup with that and they don't have
(15:16):
the same view of the cost ofthat after that period of time.
So to me I think, organizingthe diary, organizing the
clinician element of it, itshould be less than eight weeks.
Really.
(15:37):
You could go, you could go outmore than more than one week,
two weeks, if the practice cando it.
You may not have the personnelit's so.
Dr James (15:46):
It's so fascinating because there's no listen.
There's no listen.
There's no rule book on thisstuff.
Right, that would be nice, butit's one.
I've heard clinicians say threemonths is normal.
I've heard clinicians say nextweek is normal.
I think again, listen, there'sno right or wrong answer.
But if I was to lick my fingerand put it in there two, three
weeks, I reckon something likethat, because then they start to
(16:07):
get the especially in there two, three weeks, I reckon
something like that, becausethen they start to get the,
especially the kind of, uh, youknow, as you say, it depends on
the patient.
Say, you've got the instagrampatients who want invisalign.
They want to start yesterday,some of them.
Do you know what I mean?
Um, and as you say, ifsomeone's got by the way, that
two, three weeks, I said was forelective treatment, pain
treatment, it's, it's yesterday,if it can be.
Do you know?
Know what I mean?
It's as soon as it can.
(16:27):
But no, I just wanted to.
I deliberately didn't want tosay my, what I believed my
answer was because I wanted tohear your take on that.
But anyway, I didn't mean to.
Johnny (16:39):
I think it's right because that is a sales thing,
that is a marketing thing and adental practice.
When you're selling what couldbe high-ticket items to people,
it fits the same bill as if youwere selling something else.
It's going to cost you a fewhundred pounds, several hundred
(17:01):
pounds, whatever it might be.
You can't drag it on becausethat's not a good marketing.
You sell it and you sell themthe solution.
And once you've done it, thenyou're going to bill them at the
point of doing it, unless youtake the money up front, and
(17:22):
there's an old professionaladage that says you bill them
when the tears of gratitude arestill in their eyes I've heard a
variation on that pay the paythe worker, while the beads of
sweat are still on theirforehead.
Dr James (17:38):
So I guess it.
I guess it works both ways.
The principle, is absolutelythe same they're billing the
patients as the patients aregetting emotional for the great
treatment, but they're givingthe associate share the
straightaway right principles,Something like that.
Anyway, something like that.
I'm being slightly facetious,but you know what I mean.
I know exactly what you mean,James.
Johnny (17:56):
I think that is something that we need to do,
but a lot of that is to keepyour clinicians happy and keep
them focused and actually usethat chair side time as best you
can correct.
Dr James (18:15):
Anyway, that actually brings us full circle, because
you were just talking aboutassociates before I sidetracked
the conversation you will ask mewhat percentage your associates
get paid you know what's funny?
Before we shot this podcast, Isaid to Johnny Johnny, one thing
we have to talk about becausethere is a lot of debate is one
(18:38):
word you could use on socialmedia at the minute about
associate splits and, fair tosay, it is a divisive topic.
So before I pulled us on towaiting times, we were just
talking about associates, whichsegues nicely into associate
splits.
Johnny, what's your take onthis?
(18:58):
What's your take on this?
Johnny (19:01):
Right, I wish there was a single answer, but if you were
to say to me what does itdepend on?
I think, more than anything, itdepends on the location.
Dr James (19:17):
Not always Was that location or vocation Location
Location Actually, that's aninteresting thing you should say
.
Johnny (19:25):
But vocation as well.
But location, I I think, is thething.
If you've got a practice in anarea where you can attract
associates and so on, peoplewill try and tend to bring the
bring the uh percentage thatthey get paid down or the UDA
(19:48):
rate down Makes sense.
That's not always a good thing,because your patient base likes
to see the same dentist, theylike to see the same person,
they like a certain amount ofconsistency.
And also, as time goes on andwe found this after COVID if you
(20:09):
treat your team badly and youscrew them to the floor every
chance you get, after two orthree years you become known for
that and it's difficult then tostart to attract the people.
And then you start to worrywell, why am I not getting
associates?
Why can't I get hygienists ortherapists?
(20:31):
Well, actually, the word's outthere on the marketplace.
And for a dentist to sort ofsay well, that's not true,
believe me, it is true, the wordgets around.
So there is an element ofbalance that you need to do and
you can pay people less.
You can pay people less andtreat them well and have them
(20:55):
still appreciate you and want towork for you, because sometimes
practice hasn't got the moneyto pay the big bucks.
Sometimes the practice is in aplace or in a location that it
can't do, that it hasn't gotthat capability.
(21:16):
But sometimes for people, thisis where we come to vocation.
Sometimes you have people and,whether they are hygienists or
nurses or associates or whateverthey might be, sometimes they
actually like working in thatpractice.
For those patients, for thatowner, in that particular way,
(21:38):
it's a nice place to work.
So it's not always about money.
It can be about lifestyle, itcan be what you get out of it,
not just about money.
So you've got that to factor inas well.
The higher rates will oftenfollow rural areas because the
(22:05):
owners haven't always got achoice.
They've got to entice peopleright, but there it comes down
again to what I'm saying abouttreating people well.
This is a two-way street.
The associates have tounderstand and get where the
owner is and the burden that theowner is carrying, as well as
(22:30):
the associate.
So this happens both ways and Ithink you can get a balance
where everybody's happy at whatthey get paid for the lifestyle
that they have in thatparticular location.
And, James, I think I'vementioned to you before I know,
under the NASDAQ benchmarkingstatistics that we did for 2024,
(22:56):
we find that of the sample thatwe had, it's the practices in
central London who actuallyearned the less for their owners
, the least for their owners.
Dr James (23:13):
Crazy, because that's where the lowest splits are as
well, right.
Johnny (23:17):
It is, it is.
And on that you will get ownerstrying to start their
associates at a relatively lowpercentage rate, let's say 35
for example, but then the morethey do, the more they get paid.
So they go up in bandings.
(23:38):
Um, once they get past acertain level which the owner
can calculate pays for hisoverheads, then the associate
actually can get up to 55% and60% over that if they're high
grocers, if they're high earners, because in that sort of thing
(23:59):
everybody wins.
So the owner gets more workcoming through the door and the
associates debts pay for it,whereas if you get someone
coming in and doesn't do a fatlot, they're taking up surgery
space and that surgery spacecould be used by someone who
(24:20):
works faster, who works better.
And you know this comes down tothe.
The owner, the proprietor istrying to do this to build their
practice and I think that'ssomething sometimes the
associates don't always realize,sometimes the proprietors don't
(24:41):
always realize it either.
Dr James (24:43):
I got, I was just going to say I got love for both
sides of the debate.
Yeah, because Because theprinciples you know.
It's not an easy place to be inbusiness where you're losing
money and you're working 16hours a day, Whereas the
associates how it can comeacross to them is that the
(25:03):
principle is overly moneyorientated, Whereas in reality
they really don't know what'sgoing on behind the scenes.
So I've got empathy for bothsides.
I really do, and I feel like itstarts.
Better handling of thatsituation starts with empathy.
Johnny (25:21):
I agree with you.
I agree, and there's nosubstitute for actually working
as a team and having anunderstanding, rather than
somebody turning up and saying,right, I'm here and I'll start
at five past nine and finish itfive to three and I'm off,
where's my money?
Dr James (25:42):
without actually thinking of how that fits into
the bigger picture and you knowthe curious thing about
associates and principals bothoften think that they've got the
better deal, because theassociates tend to think that
the business owners are all inmoney, and it's not.
By the time everybody else ispaid and the debt serviced and
the overheads are paid for.
(26:04):
It's not always the case, butanyway, if anybody wants to see
some more interesting debate onthis topic, that johnny and I
are talking about some real rawand ready opinions, I think, is
one way of saying it.
Uh, have a look at the denniswho invest facebook group, some
of the posts that are on therefor the moment.
And, as I say, we create thesepodcasts to help everybody
(26:25):
understand and be moresympathetic to each other's
positions.
Any more to say on the numbersfront, or do you think that's?
Johnny (26:33):
about it.
Looking at that patient side ofthings, I think that, and the
diary management, and onceyou've got the patients through
the door, it's getting them inthe right chair in front of the
right clinician, whether it's atherapist or an associate or the
(26:56):
owner that's important Now,that organization of patients
and so on.
That, to me, is the end of it,of creating resilience we talked
about in a dental practice,because that efficiency
effectively is resilience andwhether you're trying to build a
(27:17):
practice for sale or build apractice that's going to give
you a steady income as an owner,a steady income as an owner
month after month and year afteryear, it's the same thing.
And if something happens, likeCOVID or something, or something
happens to the practice, thenyou've got a little bit of slack
(27:41):
if you're running the place.
Efficiency, that is importantto do that.
Now.
We haven't talked, James, aboutum, new patients, um, or new
work, because that is somethingwhich is is the other side of
the patient side.
Now, if you are a specialist,then your patient, your, as it
(28:06):
were, is a different person thanthe patients that you're seeing
.
So that's something that, as aspecialist, as a referral
practice, you've got to keepgoing, because if you don't keep
it going, there'll be somebodyelse out in the marketplace that
will be wanting to speak toyour referral sources, and
(28:28):
that's something that isimportant and that's a
continuous thing that you haveto do, that you have to build
into the uh, into the how theworkload flows month after month
and, from a resilience point ofview, you have that regular
flow from your regular peopleplus others.
(28:50):
That's important.
That gives you the strengthgoing forward.
If you're a general practice theGDP then that's more about well
, two things really.
It's about your presence in thelocal market, rather than being
(29:11):
hidden away down an alley thatnobody knows you're there apart
from your patients.
You need to have that presenceto say I'm here.
That comes back to James, towhat you said about when can I
be seen by my dentist.
And if you turn up to a newpractice who's looking for new
patients and you're told, yeah,well, we can see you in four
(29:33):
months, you've just lost thatpatient, that potential new
patient.
It's not going to happen.
That's important.
But that and turning yourexisting patients into
ambassadors for you, that'simportant.
That's really important to keepthat flow of new people coming
(29:57):
through, because you are goingto get people who want to move
away get come back to locationagain here.
If you're in a large housingestate where you've got a churn
of families in and out all thetime, you've got something
naturally which is happening.
If you're in a rural markettown or something, you don't
(30:19):
have that sort of churn, you'vegot to keep replacing your
patients because some of themare going to die and you can't
do much about that well, I mean,it's morbid to talk about,
isn't it?
Dr James (30:34):
but I guess it's it's well, it's completely true.
I mean, I think one sort oftakeaway that I'm gathering from
what you're saying is that Ithink that for some people,
safety is seen in staying thesame and stagnation, but
actually that has inherentdanger too.
So there has to be a little bitof liquidity in the patients,
liquidity in the business interms of cash flow.
(30:55):
That actually helps with theresilience side of things.
Johnny (31:00):
No, you're absolutely right, James.
But the other factor, apartfrom patients, is the treatments
that you give them.
You know, with a specialistoffering specialisms, now you
can have a specialist who takesreferrals only and simply does
(31:20):
the referrals, say root canals,somebody who specializes in endo
and doesn't have their patients, they take patients from
somewhere else, have theirpatients, they take patients
from somewhere else.
Um, that is gotta keep thatgoing because you've got to keep
your referral sources running.
If you've got specialists in ageneral practice, that's a
(31:44):
slightly different sort of thingbecause you're marketing them
to the general patient base aswell as potentially to other
referral practices, otherreferral sources.
For that sort of work.
The downside is you've got tokeep doing it and it's a more
(32:06):
personal thing so it's noteasily as easily transferable on
sale and people know that.
Buyers know that.
And for specialist treatmentsthe number of buyers is always
reduced because not everybodydoes endo or not everybody does
(32:27):
Invisalign and nor do they wantto.
So your number of buyers isdown.
But the upside is it can bemore profitable for you if you
are working on that, sellingthat sort of treatment to your
patient not always so.
(32:48):
The measure of that is if you'remeasuring KPIs.
The KPIs have to be measuredafter the direct costs because a
lot of specialisms carry quitea heavy direct cost with them
and it's easy to look at the topline what's coming in,
(33:10):
particularly if you get paid upfront.
Um, and it's easy to look at thetop line of what's coming in,
particularly if you get paid upfront.
It's easy to look at it and saythis is fantastic, without
actually knowing there'sactually quite a lot of work to
be done and quite a lot of costto follow down the track a
little bit.
Those KPIs have got to bevalued.
(33:33):
It's like dealing with any ofthe patients.
You've got to look at the KPIper hour and there's also if
you're spacing your surgeries atthe premium, you've got to look
at the KPI per square meter,because sometimes an associate
(33:54):
who comes in, for example, anddoes half day and then the
practice is empty for the otherhalf day, sometimes they can
actually make less profit forthe owner than if you had, say,
a hygienist, for example, who isin there working all day, or
(34:15):
two hygienists working fillingthat same space 10 hours a day.
So you've got to look at thosethings in the particular
practice as well and I thinkthat's quite interesting.
Dr James (34:28):
Question Johnny and this is a little niche but still
very useful Hygienistremuneration salaried or split?
Johnny (34:40):
The hygienist the remuneration, depending if it's
a salary or if it'sself-employed.
Is that what you're asking?
Dr James (34:50):
Yeah, should you salary your staff, your
hygienist, because I've seenpeople.
This is another thing thatpeople argue the hell over.
Johnny (34:57):
I'd be interested to hear your take Okay.
The person who decides whetherthey're salaried or
self-employed isn't you or me,it's the taxman.
And the taxman has got certainwhat we call badges of
self-employment and badges ofemployment that they will apply
(35:23):
in this sort of situation.
And the fact this is not adental thing, this is right
across business, and if you havethe badges of self-employment,
you can be self-employed.
Dr James (35:37):
If you don't, you are forced to be employed and your
own, the owner of the practice,has to apply that so what you're
saying is that when peopledebate this because I've seen
people you know, I don't want toname names I've seen people say
on facebook I pay my, I pay myhygienist a wage.
(35:58):
That that's really ropeyterritory, because unless
there's anything thatdistinguishes their hygienists
from their associates, they'regetting in a murky territory.
Is that, have I understood?
Johnny (36:07):
that is that that is correct, and bear in mind that
it's the proprietor that has topick up the tab on this if it
goes wrong, not the hygienist,because you are then into the
world of employment law, where,if you are deemed to be employed
, then your deemed employer isresponsible for deducting the
(36:30):
amount of tax and nationalinsurance responsible for
deducting the amount of tax andnational insurance and if they
have treated you asself-employed and they have not
deducted tax and nationalinsurance as employed, it's up
to them to sort it out, not upto the hygienist.
Right, wow, which is frightening, which is why an awful lot of
(36:50):
big places like hospitals and soon and so on.
You don't have this argumentyou're employed, end off unless
you can come up with the badgesof one.
They're not badges ofemployment, self-employment.
There are a number of thingswhich fit that, but I suspect
that that is a different podcast, because we could go on and on
(37:13):
on that one as to what to do tobring yourself into the realms
of self-employment, becauseself-employment is better for
the hygienist or the therapistor the associates, and it's also
better for the proprietor andit's also better for the
(37:34):
industry.
The person that it's not betterfor is the taxman.
So organizing your affairs tohave these badges of
self-employment is a reallypositive thing to do for
everyone, but that's a differentpodcast, James.
Dr James (37:54):
It sounds like it the debate's almost settled there.
In that case, it's less a moneything, more a staying on the
right side of the law thing andnot creating some sort of huge
tax liability.
Johnny (38:09):
There's times to push the boundaries.
Those sort of areas areprobably not them, because it's
pretty straightforward.
As for the tax map, it's prettystraightforward, so and unless
you jump through all the hoopsall the time, you've got a
(38:33):
problem.
So that's the thing there.
But coming back to treatmentsand where treatments are a
factor, if you're a generaldental practice, we talked
earlier about knowing yourpatient and knowing your patient
base.
We talked earlier about knowingyour patient and knowing your
(38:54):
patient base.
Being able to see whattreatments you can market across
your patient base isinteresting and important to do
that Because you can't go into apractice where the average age
(39:17):
is 65 and start trying to say,well, I'm going to sell
everybody Invisalign Not goingto work.
Similarly, there's the otherside of the coin, and that's
with all younger people.
There's certain things you canmarket to them.
There's other things that youcan't.
You're wasting your time.
So you've got to know yourpatient base.
If you were a hundred percentNHS practice, you've got a
(39:40):
pretty obvious thing where youtake your band one, two and
three treatments and you splitit up and see how many people
are in each of those bands whereyou what sort of treatments you
give every to everyone, uh, ina 12-month period, and that
gives you an idea of just whatyou might be able to sell, maybe
(40:01):
as private, maybe on top ifyou're a private practice um, I
know sometimes we do in ourpractice.
We're looking at practice andwe would split, not a band, one,
two and three, but we wouldhave, say, five tiers of private
(40:21):
work.
So our tier one is pretty basicexam scale and polish through
to tier five it's being somepretty heavy, like an implant or
something like that, and yousplit them all in between.
Then you can start sayingwhether there's an average cost
or an average price for each ofthose types of things.
(40:42):
Also, you've got to look at thetime it takes to deliver it,
because there's no point ofhaving a super-duper big-ticket
item that takes you five hoursto deal with, whereas you could
have something very simple butyou can churn out 50 of them at
(41:04):
the same time.
This is going to take youhaving the big-ticket item and
give you less stress.
We've also got to look at theclinicians.
Come back to the clinicians.
Not every clinician wants to doa heavy, heavy treatment every
hour of the day.
Sometimes they actually want tohave a couple of hours where
(41:26):
some pretty easy work to be done, and you've got to have that
mix depending on the patientbase and the clinicians and, of
course, trying to maneuver thatas best you can into your diary,
the diary management.
But that's the other side oftrying to give a resilience to
(41:49):
the practice.
Give a resilience to yourpractice whether you're trying
to sell it or whether you'retrying to create an income
stream for it.
You can't move everything downto band one or tier one and
think that that's going to workfor you, because a lot of your
patients actually want someextras.
They want something different.
(42:10):
You have to be open to that orelse your patients are going to
drift away.
So you can try and maneuver tochange the types of treatments
delivered and something which ismore profitable or something
which is more enjoyable for thedentist that's important.
(42:32):
So the resilience of a dentalpractice, it's not just
something for a practice, anobjective practice, an object.
It changes for everything.
It has to work for you, eitheras the associate or as the owner
, and it has to base on yourgoals, not just what some sort
(42:54):
of offered loss is or what somesort of objective is that comes
from somewhere else.
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