The importance of practice cost savings in the current climate

Simon Reynolds shares six reasons why it’s an important time to look at cost savings in your practice and the benefits of doing so.Simon Reynolds shares six reasons why it’s an important time to look at cost savings in your practice and the benefits of doing so.

Inflation, the cost of living, energy prices and other supplies in most instances have all increased significantly in recent times.

It’s a challenging time for practices to manage the right mix of price increases, cash flow management and cost management. Especially alongside all the other challenges of running a practice.

In light of the current climate, it’s an important time to review costs and look to cut where possible. Let’s take a look at a few reasons why this is so important and the benefits cost savings can present.

Team retention

Finding the right mix of qualified talent and resource to deliver dentistry is tough at the moment.

There is a limited talent pool for reasons well reported in the past few months. These have resulted in most clinical roles being in a position of strength to seek higher pay.

Moreover, we have heard stories of nurses quitting the profession to seek less stressful jobs that pay more money. Therefore, this adds to the talent pool challenges further.

Whilst money isn’t everything, it talks. Particularly when the cost of living is on the up.

Cutting costs can help to release funds to be able to add a little more into the payroll pot. As a result, this can help with team retention across the board.

A looming recession?

There’s no guarantee and split opinion on whether we will face a recession in the coming months.

If we do, practices will face all the challenges a recession presents.

Strengthening your cost management position ahead of time will help your practice in navigating a recession, should we face one soon.

Exit planning

If you’re thinking about an exit in the near future, marginal cost savings that help your bottom-line will have a positive impact at exit.

A saving of £10,000 per year could mean an increase in value in the region of £40-70,000 based on multiples of four to seven on EBITDA.

Funding expansion

With more dentists leaving the NHS and converting to practice privately there is an increasing pool of patients struggling to access dental care.

Patients are crying out to access affordable private dentistry.

Cost savings could free up cash to expand your practice, creating more surgery time to care for such patients.

Keeping up with groups

The market is shifting more towards practices being owned by groups.

The market share of group-owned practices currently stands in the region of around 27% and this will only head in one direction for the foreseeable.

Groups are able to leverage economies of scale, negotiating better rates with suppliers because of their size. While independent practices can’t negotiate with the same power, they can still negotiate.

It’s just best practice

In any business it’s best practice to regularly review your operations, suppliers and products to ensure you are able to deliver on meeting your customer (patient) needs and meeting business objectives whilst managing costs as effectively as possible.

If you can work with an alternative supplier or product without compromising service, why pay more?

There are a wide variety of ways a practice can cut costs:

  1. Negotiating with current suppliers/providers. This can be beneficial but often reduction in prices are either time bound, come with the loss of elements of the service you’re used to, or require large volume orders
  2. Transitioning to new suppliers/providers. If you can find everything you want in a new supplier, and their costs are lower as standard, this should always be the preferred option as you won’t encounter the issues you’re likely to face when negotiating
  3. Consider joining a buying group. Independent practices will never, on their own, have the buying power or ability to negotiate like a larger group. Joining a buying group made up of likeminded independent practices can mean you can reduce the costs of supplies quickly and easily, avoiding difficult conversations
  4. Invest in your team. Staff turnover costs money – a lot more than you might realise and it is always more cost effective to invest money into your existing team to ensure their salaries remain competitive and, more importantly, that they feel the culture of the practice is allowing them to develop their own career – get that right and people won’t want to leave
  5. Understand the dangers of false economy. If your digital X-ray developer breaks down, or your chair is in need of replacement, never just go for the cheapest option. Consider the longevity of that supplier and their credibility in the market; the ease of repairing the new product, how easily can parts be accessed etc. Investing in good quality equipment saves a practice significant money over time
  6. Go green! Not ordering paper, printer ink and envelopes not only saves the practice money but makes the practice more efficient. Sending emails rather than postal letters cuts down on costs and helps address the climate crisis at the same time.

Hassle free switch

Naturally as a payment plan provider with a cost-saving proposition, I’m going to highlight that switching plan provider could give your practice a healthy savings figure year on year.

Last year, practices that switched to work with Patient Plan Direct from another major plan provider saved on average £12,270 per annum.

Switching is now hassle free thanks to the new Simple Switch process – bulk transferring your plan patients with zero hassle.

No action is required by your team or your patients, it’s a quick, simple, and highly effective way to save your practice thousands. Food for thought.


For almost 15 years Patient Plan Direct has helped dental practices run successful practice-branded membership plans at two/three times less cost than other major provider in the market.

For more info visit patientplandirect.com or call 0344 848 6888.

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