Feeding the green shoots of recovery
The recession that started to bite within the dental market during 2010 has been something of a wake-up call for dentists, who have historically had no trouble attracting new patients and keeping those they already have.
What happened in the years between 2010 and 2013 however, resulted in a lowering of confidence levels across all sectors of society, where even those in work and with low mortgages reduced their outgoings in fear of what might be yet to come. This belt tightening resulted in a contraction of the whole market and, according to Mintel’s (2013) industrial report into dentistry, caused a 7% fall in revenue in the general private dental sector during 2013. Indeed, both NHS and mixed sectors have suffered from the Government’s austerity measures, which reduced public spending, with many patients extending the time between routine appointments and postponing non-urgent restorative care.
Latest statistics from NHS England (HSCIC, 2014) show that a total of 29.9 million patients (55.9% of the UK population) were seen in the 24-month period ending 31 December 2013, representing an increase of 8.3% when compared with the 2006 baseline, and an increase of 0.4% on the preceding quarter (ending September 2013). But, having been through three of the toughest years ever experienced by the market, are these latest figures an indication that the much-heralded 'green shoots' of recovery are well and truly embedded, or should the profession still be wary of anything that might kill off the early signs of life?
Evidence of these green shoots blossoming came from last month’s GDC (General Dental Council) patient survey, conducted by Ipsos MORI (GDC, 2014), which revealed that 96% of those who visit the dentist once a year are satisfied with the dental care or treatment they receive, and three out of four feel they are given enough information about treatment by their dentist. These positive results demonstrate that once back in the practice, patients are highly receptive to dentist recommendations.
Furthermore, the latest report from NASDAL (National Association of Specialist Dental Accountants & Lawyers) (2014) shows that for the first time in eight years there has been a narrowing in the gap between profit levels of practices in the NHS and the private sector. This indicates a significant recovery for private practices, which have successfully harnessed greater flexibility and control over fees and costs, to achieve the first increase in profits since 2008.
The Government’s key aims for NHS dentistry have long been the dual golden bullets of increased access and improved preventive care. It seems that the long-awaited and much piloted NHS contract will simultaneously address both these issues via the proposed oral health assessment. This assessment will create a treatment pathway for patients based on need, extending recall intervals for those 'dentally fit' patients, and thereby increasing capacity and access across the sector, whilst concentrating care on those most in need. This increase in capacity will inevitably result in a highly competitive market for patients, with NHS practices competing against each other and with colleagues in the private sector, to gain new patients and retain those they already have.
The challenge for principals and business owners is to understand the changing market conditions and to appreciate the likely impact on their own businesses. Being fully aware of the opportunities that might arise will allow principals to make positive decisions now, in order to take advantage of market changes and be highly competitive from the outset.
Facing the challenge
So what strategies can be adopted to make sure that your practice is in good shape to face the challenges ahead? One of the key environmental factors for a successful business is predictability, and over the last three years many practitioners have come to realise that uncertainty in the lives of their patients has had a knock-on effect, in some cases resulting in a devastating fall in practice revenues. Tools that can be employed to safeguard a practice against the peaks and troughs caused by such uncertainty are welcome assets to any practice.
Those practices with patients on dental plans did enjoy a certain level of immunity from the volatility caused by the recession. Anecdotal reports stated that plan patients, who had every motivation to attend the routine appointments for which they were already paying, had continued to attend regularly, thereby maintaining a good level of patient flow through the practice.
A payment plan also ensures a defined level of income each month and cash-flow predictability that allows for baseline revenue to be forecast with an element of certainty. The effect of this is to enhance your ability to plan, set achievable income targets and assess progress on a regular basis. Of course, as with anything concerned with practice finance, it is essential to work alongside a reputable company with a proven pedigree in the industry, and one that can be relied upon for personal support and guidance whenever it is needed.
Building patient loyalty
The ability to build a ‘brand’ is a central factor in the success of most businesses, we need only look at the high street for evidence of this. Most private dental practices spend significant resources on developing its own ‘brand’ and some have found that the credibility of this can be enhanced by developing an attractive practice branded dental plan that enables patients to budget for their dental care, while adding value to the practice’s brand.
Having the support of a dental plan provider that understands the market is vital if you are to be able to take full advantage of the more positive economic climate. Choose a company that has the ability to support you, not only during the launch phase, but also for the long term, providing marketing and patient recruitment support as and when required, along with tailored consultancy and team training to ensure the continued success of your plan.
Strategy for growth
Understanding that patients who visit a particular practice do so for a variety of reasons, not least because they like and trust their practitioner, is important. The power of such loyalty, that may well have been built up over many years, is not something that should be dismissed and patient take-up of dental plans is often enhanced because the plan is 'practice owned' and presented to them by the dentist or a practice manager whom they know and trust.
There is an undeniable link between the likelihood of patients returning for routine treatment and the trust placed in one’s dentist, and research carried out by Bray Leino on behalf of the British Dental Trade Association (2012) discovered that 88% of those polled had a 'very high' degree of trust in their dentist. The research found that this level of trust was directly related to patients’ willingness to follow advice, with more than three in four people (76.4%) deciding how often to attend for a routine check-up based on their dentist’s recommendation.
The introduction of a practice branded dental plan makes sense for all types of practice, both financially and in terms of the benefits such a move can bring to patients. The ability of a practice to control all elements of its service provision is vital in attracting and retaining patients, as well as building levels of satisfaction, that will ensure the green shoots of recovery are nurtured and tended. By preparing your business now, you will be well equipped to take full advantage of the recovery from the outset and benefit significantly from a more open market, resulting in substantial future growth.
British Dental Trade Association (2012) Perceptions of Dentistry and Motivation Research April 2012, [Online], Available here [Accessed: 17 April 2014]
General Dental Council (GDC), (2014) 2013 Annual Patient an Public Survey, General Dental Council: London
Health & Social Care Information Centre (HSCIC), (2014) NHS Dental Statistics for England: 2013-14, Secondly Quarterly Report, HSCIS: Leeds
Mintel. (2013) 'Dentistry (Industrial Report)', [Online], Available here [Accessed 17 April 2014]
NASDAL. (2014) NASDAL benchmarking stats show private practices in recovery, [Online], Available here [Accessed: 17 April 2014]