You know what they say about overhead:
“If you don’t measure it, it’ll eat your lunch.”
And if you’re a dentist, that lunch isn’t cheap—think filet mignon, not PB&J. So what is the recommended total overhead percentage target for general dental practices? And (real talk) how do you actually hit it… without grinding yourself and your team into the ground?
If you want the straight, fun, no-fluff answer (plus the secret to making overhead your friend, not your enemy), read on.
STORY:
The Dentist Who Let Overhead Win (And the One Who Fought Back)
Meet Dr. Sam. Smart, talented, but always stressed.
Every month, he’d open his P&L and wince:
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Payroll: too high
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Supplies: creeping up
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Facility: rent is murder
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Insurance write-offs: soul-sucking
His overhead? 80%. Profits? (Crickets.)
One day, Sam had enough. He looked for “the recommended total overhead percentage target for general dental practices” and saw the same number everywhere: 60–65%.
But here’s the kicker:
Most dentists never hit it. Why? Because their business model is broken—and their revenue is all over the place.
Dr. Sam decided to flip the script and joined the new wave:
Membership-based dentistry.
He launched a plan with BoomCloud™, built predictable MRR/ARR, optimized his revenue per patient, and finally made overhead a weapon—not a weight.
What’s the Recommended Overhead Percentage? And How Can You Crush It?
Short Answer:
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The recommended total overhead percentage target for general dental practices is 60%–65%.
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Top performers? They run leaner, sometimes 55%. Most? They bloat to 70–80% (yikes).
But Here’s the Epiphany:
It’s not just about slashing costs. The true profitable dentists?
They increase recurring revenue, optimize for revenue per patient, and make sure their overhead ratio is always shrinking—even as they grow.
Here’s how you can do it, step by step:
1. Launch a Membership Plan (Your Secret Weapon Against High Overhead)
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Recurring revenue smooths out the wild swings of insurance-based practices
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Membership patients spend 2x–4x more (BoomCloud™ data, 2024)
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With steady cash flow, you’re not sweating rent or payroll every month
2. Focus on Revenue Per Patient (The Only KPI That Matters)
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Instead of “How many patients did I see?” ask, “What was my revenue per patient?”
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Membership plans let you offer more, and patients say “yes” more often (because value > discounts)
3. Optimize MRR & ARR (Let the Numbers Work for You)
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MRR (Monthly Recurring Revenue) lets you sleep at night
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ARR (Annual Recurring Revenue) lets you plan for the future
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Example: 200 members x $40/month = $8,000 MRR = $96,000/year
4. Watch Overhead Percentage Drop (While Profits Rise)
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As revenue becomes more predictable and less insurance-dependent, you invest smarter
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Overhead % drops even if your raw costs stay the same
THE DATA: How Overhead Impacts Your Bottom Line
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ADA/Industry Average:
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Payroll: 24–28%
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Supplies: 5–7%
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Facility: 5–7%
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Labs: 8–10%
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Marketing: 3–5%
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Miscellaneous: 5–8%
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TOTAL TARGET: 60–65% overhead (including dentist’s salary as production expense)
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Membership Practices (BoomCloud™ 2024):
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Overhead as low as 55–60% (thanks to recurring revenue & higher patient value)
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Profit margins up 25–40% vs. insurance-based offices
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CASE STUDY: Dr. Sam’s Overhead Transformation with BoomCloud™
Before:
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Overhead: 82%
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Revenue per patient: $790/year
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High staff turnover (everyone stressed)
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Chasing insurance AR (aka “The Seventh Circle of Hell”)
After One Year with BoomCloud™:
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Overhead: 61%
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Revenue per patient: $2,130/year
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Staff retention: 95% (happy team, happy patients)
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MRR: $11,600/month from 290 members
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Dr. Sam has options—not just obligations
“Membership was my ticket out of the insurance trap. Now my overhead is under control, my team’s smiling, and I’m finally taking Fridays off.”
— Dr. Sam
COOL IDEAS & BOOMCLOUD™ POWER MOVES
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How to Slash Overhead Without Cutting Corners:
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Automate billing and patient communication (BoomCloud™ does this)
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Use digital forms, online scheduling, and teledentistry to cut admin bloat
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Reward staff for enrolling patients in the membership program (creates buy-in!)
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Analyze expenses quarterly—cancel the stuff you don’t need
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How BoomCloud™ Helps Keep Overhead Lean:
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Predictable income = smarter hiring (no more overstaffing “just in case”)
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No chasing payments = less wasted time (time is money!)
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Better retention = less spent on marketing to replace lost patients
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Dashboards track every dollar, every member, every month
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FAQ: Overhead, Memberships, and the Profit Mindset
Q: Can you really get overhead below 60%?
A: Yes! Practices with strong membership programs and smart cost management routinely hit 55–60%—while increasing take-home profit.
Q: Does cutting costs hurt patient experience?
A: Only if you’re cutting the wrong things. Memberships actually improve experience: more time, better care, less insurance drama.
Q: What’s the fastest way to lower overhead?
A: Increase recurring revenue. Every new membership drops your overhead %—and gives you cash flow security.
What’s your biggest “overhead horror story”?
Drop your tales of expense gone wild or your best savings hacks. Let’s swap ideas and help every dentist hit that 60–65% target!
The recommended total overhead percentage target for general dental practices is 60–65%.
But that’s just the baseline. The new standard?
Recurring revenue, higher patient value, lower overhead, and profits you can actually feel in your bank account.
Want to win the overhead game?
Membership programs are your cheat code. BoomCloud™ is your secret weapon.
NEXT STEPS & RESOURCES
AUTHOR
Written by a world-class copywriter who loves numbers, profits, and helping dentists escape the tyranny of high overhead.
