By: Klifford T. Kapus DDS, MSD
I generally stay away from offering business advice because my experience practicing in California has been more about survival than expanding market share. Until they start handing out medals for keeping your head attached to your torso I’m not going to win any awards. But that said one thing I do know about is maintaining ruthless control of my overhead expenses.
So if we’re keeping it basic, profit equals income minus overhead expense. Simple, right? Well you’d be surprised at how many people will tell you that it’s “not so simple”.
The folks who sell orthodontic products want to convince you that you absolutely must purchase their product/technology because it will either make you a better orthodontist or it will drive new patients through your door or both. But almost always the person who takes all the risk is you while they stroll off counting the dollars. That’s good salesmanship, of course, and you can’t blame them for trying to make a buck but what can you do to be a better consumer?
Well first off you can brush up on some of the common techniques that are used to separate you from your money and figure out which of them are couched in validity and which of them are total bullshit. (Spoiler alert: most of them are total crap.)
In order of highest to lowest BS, here are some of the more commonly used sales pitches:
- Buy the product and the patients will come in to see you because of it.
- This is my favorite technique because it’s a tautology or circular argument and it’s very hard to argue against. Just like the “chicken and the egg” debate there’s really no way to know the truth until it’s too late. The vendor tells you that instead of waiting until you have enough patients to justify the cost of the new doo-dad you should buy the new doo-dad first and then the patients will come storming in. While this argument is based on a business axiom (you have to spend money to make money) the fact of the matter is when it’s coming out of a salesman’s mouth it’s almost always codswallop intended to get you to spend. The rationale goes something like this: “we find that doctors who have ‘taken the plunge’ and incorporated our technology/program/product into their offices discover that their patients are much more likely to refer their friends and family and in no time at all they’re making enough extra money to pay for the additional cost of our technology/program/product.” Well that’s all well and good but stop and think about it logically for a moment. If they’re right then they make money and you make money and everyone is happy-clappy. But if they’re wrong then they make money and you lose money and too bad, so sad; sucks to be you. In either scenario the only person who is guaranteed to make a profit is them, not you. Bottom line: you’re making a speculative investment and the only party without risk is the vendor.
- Buy the product and you will “set yourself apart” from your competition
- This one’s just too easy. If the only thing that “sets you apart” from your competitors is a fancy piece of technology then it’s a tenuous lead at best. Assuming it’s a big practice builder for your office (doubtful) then all your competition has to do is buy it too (or worse, the latest iteration with lower radiation or faster scan time or whatever) and then POOF, there goes your “uniqueness”. If you’re going to set yourself apart from the competition, do something that no one can take away from you. Be the mountain climbing orthodontist or the Spiderman orthodontist (I actually know him) or the Zen Buddhist, bodybuilding, animal themed office orthodontist. On second thought, that last one just sounds weird…
- Buy the product and you will keep up with your competition.
- Ah yes, the old “keeping up with the Joneses” argument. If there was ever a bad reason for increasing your overhead expense this is it. If your idea of “competition” is an endless pissing contest with the guy down the street then you’ve gone off the rails and are beyond any help. The fact of the matter is that unless you are the biggest act in town then you probably don’t have money to throw away on vanity. Now if it happens to be a product you actually need or something you’ve been saving up for and it also happens to put you on par with your competitors then great! Not only will you get to own your beloved product, you will also take away some of that “uniqueness” your competition has been lording over you.
- Buy the product and it will save you chair time so you can see more patients.
- Who is this a problem for, exactly? Are you at capacity? Could you potentially see another 10 patients a day? 20 patients a day? 40 patients? If the answer is yes then what’s the chair time savings for you really? More opportunity to check Facebook? Yes, a 3 second curing light is nicer than a 20 second curing light but unless the six extra minutes it saves you is going to break your afternoon schedule then it’s probably not worth the extra $800 a chair. In fact, I can’t believe I just wrote that last sentence! If you are seriously considering purchases like these then you need to own up to the fact that they are not born of business acumen, they are based on a desire for convenience.
- Buy the product and it will increase the accuracy of your appliances.
- Is this an issue in your office now? Are distorted impressions or lousy models contributing to wasted time on doing things over? Perhaps some remedial education with your staff on impression taking or model pour ups will solve the problem. I recently had an issue with some of our Essix retainers not fitting well because there were bubbles in the casts. I took everyone in the lab and explained how I wanted the models to be poured up. After vibrating the stone into the impression I set it on the counter and told them to leave it like that for 45 minutes to an hour. One of the staff said “you don’t flip it upside down?” and BAM: problem solved. No, you don’t flip it upside down because gravity will pull the wet stone out of the impression and you’ll end up with bubbles in your casts! That whole episode cost me 10 minutes, not $4000 on a new piece of machinery.
- Buy this product and you will save lab fees by doing it in house.
- Watch it because this one might actually be true. There are definitely some benefits to doing things in house and if you can get good results this way and pocket the difference then it’s worth hearing them out. Don’t be penny wise and pound foolish though. If it looks too good to be true then it very well might be but at least take the time to run the numbers. And if there’s an opportunity to do a trial run and find out if the learning curve isn’t too steep then perhaps you should give it a whirl.
This all might seem like common sense but the truth is that many orthodontists over the years have enjoyed a large profit margin and thus been able to justify wasted overhead on salesmen sophistry without it having too big of an impact on their ultimate survival. But if you’re just starting out or you’re doing business in a difficult area then every penny counts and there’s no excuse for wasteful spending.