There’s no doubt that we’re all experiencing the effects of the rising costs of energy, food, materials and everything else. Practice Plan area manager, Gary Nelson, suggests some things practices can look at to ensure they’re making the best use of their money over the next few months.
Looking on the bright side, independent dentistry has seen a period of solid growth since practices were allowed to reopen after the Covid lockdowns and restrictions. However, we do have to face the fact that the immediate future is likely to prove challenging to most businesses, dental ones included.
Rather than just panicking, although it is very tempting to sit head in hands and lament our fate, I like to focus on what we can do. There are very few situations where there aren’t some steps that can be taken to improve matters, even if the gains they yield are marginal.
Improving matters
It was by achieving marginal gains in multiple areas of the team and its equipment, something he called ‘aggregating marginal gains’, that Dave Brailsford took British Cycling from a state of mediocrity to the team that dominated track and road cycling events at the Beijing Olympics in 2008. In this case, literally every little helped.
By taking a little time to review how you do things, you may well find ways of improving matters for yourself and your practice. They may only be small improvements but if you find enough of them, together they could make a noticeable difference. Devoting some time now to focus on things, could pay dividends.
The first step is to ‘Control the Controllables’. These are things that you can influence and are just sensible things to consider.
Some may be achievable unaided, whereas others may need the expertise of a financial adviser, such as Wesleyan’s specialist financial advisers. Their dedicated dental team works with dentists to ensure they have all the information they need to make informed decisions about their finances.
Here are some suggestions of areas you may want to consider:
Look at your personal expenditure in relation to your profits and drawings on the business
There’s no getting away from the fact that this is going to be a tough winter. It might be a good idea to look at your personal spending. See if any adjustments and savings can be made. Perhaps cutting down on non-essential purchases.
We all have our fingers crossed that this crisis will be short lived. There is an economic school of thought that says inflation may fall quite quickly, so hopefully, this too shall pass.
Ensure you have the right business structure in place
It may be beneficial to change or extend your accounting period and year end. This is something where it would help to have a conversation with your accountants and tax advisers.
Make sure you are attracting the right type of new patients for your business
The right type of patient is someone who needs or wants the treatments you prefer and enjoy providing. Referral cards and asking for referrals have little cost associated with them but they can bring great returns in the shape of new patients. Sadly, this is something many fail to take advantage of. If you don’t ask, you don’t get.
Make sure you are planning for your pension effectively
Pensions are complicated, especially if you have an NHS pension or run a mixed practice. Time spent making sure you have the correct provision for when you retire will give you peace of mind now. It could also prevent some nasty surprises later on.
If you are a limited company, check out the benefits of directors’ pension provision. Also make sure you’re making use of your annual ISA allowance.
Discuss tax planning with your specialist tax advisers
Perhaps look at HMRC structured payment plans. This could allow you to retain cash in the business. However, it’s important you seek the right advice.
Talk to a specialist financial adviser
This could be relevant life planning and policies for your business. For example, income protection, key person cover and so on.
Explore the idea of offering benefits in kind to your team
Your team will be struggling financially at the moment. We’re all aware of the difficulties of recruiting and retaining good staff. It may a good idea to look at offering benefits other than cash as a way of rewarding your team and encouraging them to stay.
Speak to your advisers about benefits in kind such as a private healthcare scheme and explore other similar options. It can be a great addition to an employment package and could help show your team how much they’re valued.
Capital allowance
The Super Deduction ends in March 2023. So now would be a great time to make sure you take advantage of it before it ends. Talk to your tax advisers and see how you can benefit from it.
Clinician profitability
The pressures placed on teams over the past couple of years have been immense and lots of good habits, such as diary zoning, have fallen by the wayside during the rush.
Perhaps now would be a good time to get together as a team to discuss ways of increasing the weekly profitability. Reintroduce some of the things that worked previously but have been neglected over recent times.
Clinician mentoring
If you have an associate they may benefit from some financial and/or clinical mentoring. In the past, I have seen some big practice and business wins in this area. You know the old saying: ‘earnings can be traced to learnings.’
A few things for you to consider there. If you’d like to read similar content, you can find more information and helpful suggestions by visiting Practice Plan’s You Hub. It’s a comprehensive resource centre designed to help with the key areas affecting you the most right now: wellbeing, cost of living, business finances, and recruitment and retention.
I’ll leave you with a quote from Deepak Chopra that you may find useful: ‘In the midst of movement and chaos, keep stillness inside of you.’ I think what he’s saying is ‘don’t panic!’
