With the hype of the coronavirus filling our newsfeeds and screens, it really makes practice owners consider the future of their business. With so many world wide issues going on, it’s important to consider recession proofing your practice, and being prepared ahead of time for any possibilities. An October 2019 Bankrate survey found that 2 out of 5 Americans (or 40 percent) aren’t prepared for the next recession.
My Grandpa invested heavily in the stock market and his business ( a dental lab) and rental properties. What saved him was the BUSINESS he built & the rental properties he owned and his stock market INVESTMENTS, where he lost money otherwise he had no control over, where he had control over his business and investments. – Jordon Comstock
If we look back to over a decade ago of the recession downslide of 2008 with the stock market, the hype of the swine flu days and what those similar times did to businesses, it’s better to be safe than sorry and have some plans to consider that can be easily implemented.
Below is a graph comparing the drop of 2008 to now:
Focus on Team Building and Systems
One item that is always difficult to find time to do is training staff. Especially when the economic climate is BOOMING. This is a great time to invest in courses or on the job training with your assistants. When the economy picks back up down the road you have a better-trained staff that feels more empowered to take on more difficult restorative work. This is the perfect opportunity to look at all the technology that your practice uses, and compare it to that of newer systems currently in the marketplace making sure your practice is up to date.
Pay Down Debt – Focus on Savings
It’s crucial that you pay down any outstanding debt — more specifically, high-cost debt, such as your credit card balance — to create some breathing room in your budget. Often, economic downturns lead to job loss or downsizing of business. If you’re worried about job security, paying off your obligations might bring you more peace of mind.
Prioritize credit card debt, then turn to other types of loans, such as mortgages or auto loans. Boost emergency savings. A high-yield savings account can help you earn more on the money you stash away. Shop around for the best account that suits your needs and lifestyle. Go through your monthly expenses and live within your means so you’re not overspending in your practice.
Cut Out PPOs – Start a Membership Program
A dental membership program allows you to create your own plans as an alternative to insurance. Patients pay your office a monthly or yearly subscription in exchange for benefits and discounts. Individuals leave dental practices for various reasons, more often than not it is because of insurance coverage (money issues) and not that of poor customer service. Dental membership plans in your practice can make services more realistic for a lot of your patients that could otherwise not afford dental work, also being a win for your practice for creating recurring revenue. When the last recession hit the majority of patients lost their dental benefits and thought they couldn’t see the dentist. By having a membership program you can help educate patients to come see you without having insurance while having patients receive quality dental care and savings.
Above is an Example of a Practice that is Seeing Success with their Membership Program:
If you look at this image, you will see that this practice is generating just under $40K/mo in predictable recurring revenue from their uninsured patients. Imagine the game-changer for your practice!
This practice also is helping over 1,800 uninsured patients get quality dental care and they have cut out the middle man.
According to John Warrillow who wrote the book called The Automatic Customer regarding implementing subscription revenue in businesses, “when you create a steady flow of recurring revenue you insulate yourself from the worst of a potential recession.” This is the main reason why creating a membership program can be the smartest thing you can to do prepare for a recession.
Schedule a demo with my team to learn how BoomCloud can help you achieve success with a dental membership program: Schedule here – www.boomcloudapps.com/demo
Look at Your Marketing – Do You Even Have Marketing?
How do you market your practice to new clients or stay connected to the ones you have? Increase Profit Margins at your practice greatly by using social media, Facebook Ads, email campaigns, External Marketing and Direct Marketing. Marketing is one of the best investments whether it’s a good or bad economy.
Continue Educating Yourself, Building Skills and Relationships
To recession-proof your life one of the best investments you can make is keeping up with the latest education, trends and networking. Keep a connection with those in your field.
It’s hard to predict the future when you’re using the past as a guide. Our economy is changing so dramatically. There are many different sources that can lead to a recession, and it tends to be that when we lookout for the next one, we’re looking for the same things that caused the recession rather than recognizing that there’s a new source. To be able to look forward into the future — we don’t have that crystal ball.
Regardless of whether the storm is on the horizon, it’s always a good time to make sure your financial portfolio is prepared.