A guest blog by Cain Watters and Associates.
Nobody likes increasing fees. Despite what many patients may think, that includes dentists. However, the truth is that just like the sun, fees must also rise.
Overhead certainly won’t decrease over the life of a practice. Yet, many dentists are afraid that if they raise their fees they will lose patients. Truth is, the only thing they sacrifice is profitability.
Keeping low fees are like a slow drain over time. The effects compound annually with every new piece of equipment purchased, staff salary increase and insurance payment adjustment. This path of diminishing profits can soon hit a pothole should you want to sell or bring on a partner into your practice. When fees are too low, it undervalues the practice. Also, when the new owner adjusts to meet the market, he or she may lose that loyal patient base they were sold on.
It’s Just Business
Fees are a natural part of doing business. Every single business needs to evaluate costs and adjust accordingly. That’s true whether you sell shoes or root canals. Patients expect fees to increase over time. If the adjustments are small and the level of service remains exceptional you’re not likely to hear a peep. An increase of $4 to $5 won’t have a huge impact on their pocketbooks but could have a significant impact on your bottom line.
If you think about it, raising fees is a lot like going to the dentist. No one really likes to do it, but if you put it off too long, it ends up being more uncomfortable than it needed to be in the first place.
Overcoming Your Fear of Raising Fees
For over 30 years, Steven J. Anderson and his team of practice advisors at the Total Patient Service Institute have helped practices of every shape, size and specialty re-engineer their approach to the business of dentistry. Along the way, they managed to dramatically increase practice production and profitability for thousands.
The fact is that there are more emotions tied up in fee structures than most would like to admit-but it’s a business problem first and foremost.
So, What Should You Charge?
About the blogger
Cain Watters & Associates LLC is an investment advisor registered with the Securities & Exchange Commission. Information provided does not take into account individual financial circumstances and should not be considered investment advice to the reader. Request form ADV Part 2A for a complete description of CWA’s financial planning and investment advisory services. There is no assurance that other client actual results will be similar to information presented. Estimated future results may not be obtained due to economic, business and personal circumstances. This information should not be considered individual tax advice.