Practice Benefits 5 minutes
Learn about the benefits of creating a dental membership program. Check out our resources, video and article below!
After learning about the concept of a dental membership program You may be wondering what are the benefits to your practice. In this video we will be discussing how membership program help improve your practice from a business standpoint.
Predictable revenue for your practice
Managing a successful practice can be challenging and revenue can come in peaks and valleys, especially if you are working with a lot of dental insurance companies. Economic lulls and patient cancellations can affect a practice. A stable membership program can provide you with a healthy stream of predictable recurring revenue. This can provide some stability during slow periods. For example, We are familiar with SUCKTEMBER. When I managed Salt Lake Dental Lab, we followed the Finacial trends of a dental practice and some months were record breaking and others were challenging to get through. Now, if your office has a membership offering for $35 a month, and you secure 1,0000 subscribers to this plan, you’ll generate $35,000 per month in predictable recurring revenue. This predictable amount allows you to feel secure during times of slow business. How would you feel if your practices generated this amount whether you do dentistry or not? Will it help to cover pay roll or your overhead predictably each month?
Increase patient loyalty
By belonging to a membership program, patients are more likely to keep visiting your office. New promotions from other dental practices and regular changes from insurance companies won’t affect these patients! Patients will also feel like you are taking care of them and this always creates more loyal patients. Plus referrals will increase, especially as you give your member patients a great experience. More and more patients don’t have dental insurance and will find value in your program.
Members Spend More
We have looked at practices from across the nation and asked ourselves, How much does a member spend compared to a non-member. This is what we have found:
On average non-members spent $772.79 in a years time
Whereas the average member spend $1576.12 in a years time. This is 104% more than non-members or 2x more revenue.
We looked at an individual office that had hundreds of members and found that their members where spending 240% more than the non members. Data never lies! This is one of the greatest benefits of creating a membership program! Your patients will spend more with you because of a membership program is a system that incentives more sales.
Decreases hassle of working with insurance
Dealing with insurance can cause trouble for both your staff and patients. Waiting periods, PPO providers controlling your profits, claim submission, Claims denied and payment processing are headaches and they ultimately slow your cash flow. Some contend that managing an in-house membership program carries its own pain points. But there are many resources, like BoomCloud that help automate payments and make it easy for your office to create and manage plans and members.
Recurring revenue improves practice valuation
Recurring revenue is the holy grail of revenue for any business. I’ve worked with practices that have seen healthy returns on their in-house membership investment. If you want to build a financially strong practice, implementing a recurring revenue model can do wonders for your business and benefit you greatly if you decide to sell your practice. According to John Warrilow, the author of the Automatic Customer – I highly recommend reading this book, I will leave a link below, Businesses that generate predictable recurring revenue can be valued between 24 – 72 times Monthly Recurring revenue and sometimes more depending on the revenue size. For an example, if you have 1,000 patients paying 35/mo ($35,000/mo or $420,000) this revenue stream would be worth between – $840,000 – $2,520,000. This is exactly why you want to focus on growing a successful membership program.
1. Read this book: The Automatic Customer
2. Download our FREE ebook
3. Get your team to watch this video
Jordon Comstock is the founder and CEO for BoomCloud. He focuses on teaching dental practices about the importance of creating membership programs to generate recurring revenue, build patient loyalty, increase external marketing and increase case acceptance.