In today’s competitive dental landscape, practice owners are seeking ways to improve financial performance. Whether aiming to boost cash flow for daily operations or prepare for a sale at maximum valuation, focusing on areas of "low-hanging fruit" can yield significant benefits. Thanks to advancements in artificial intelligence (AI), identifying and addressing these opportunities has never been easier.
Ryan Mingus.
Many clients have seen early success with AI-driven technologies. However, as with any industry, there are good and bad actors. To ensure success, conduct due diligence: vet vendors, read reviews, and seek references before committing to any solution.
Steps to get started
1. Assess current expenses. Gather data on significant expense categories to identify potential savings.
2. Choose the right AI tools. Research platforms specializing in healthcare expense management, and take advantage of free trials to evaluate their effectiveness.
3. Implement changes gradually. Prioritize areas with the highest return on investment and avoid disrupting operations.
4. Track and reassess. Use AI tools to monitor results and identify new opportunities for optimization.
How technology can increase EBITDA
Earnings before interest, taxes, depreciation, and amortization (EBITDA) is a key metric for measuring profitability and operational efficiency. Improving EBITDA enhances financial health and boosts practice value. Whether planning to sell or sustain growth, maximizing EBITDA is essential.
Where to find low-hanging fruit in your practice
AI-driven tools like Spendly and Liine can analyze your business and recommend optimizations. Here are key areas to target:
1. Merchant fees
- Solution: Audit credit card processing fees and benchmark against industry standards.
- Tools: Spendly, Stax
2. Payroll expenses
- Solution: Optimize staff scheduling to reduce overtime and improve productivity.
- Tools: Deputy, Gusto, BambooHR
3. Insurance and employee benefits
- Solution: Compare insurance plans and negotiate better rates.
- Tools: Zywave, SimplyInsured
4. Telecom and internet
- Solution: Review contracts to eliminate unnecessary services.
- Tools: SIB
5. Dental suppliers and purchasing
- Solution: Compare vendor prices and leverage bulk discounts.
- Tools: Method Procurement
6. New patient phone calls and web forms
- Solution: Monitor calls and web forms to improve booking rates.
- Tools: Liine, Patient Prism
Leveraging technology for long-term gains
AI tools provide ongoing savings by monitoring expenses, alerting you to contract renewals, and recommending alternative vendors or renegotiations. These optimizations not only improve cash flow but also signal to potential buyers that your practice operates efficiently, enhancing its valuation.
A win-win for your practice
Harnessing AI to address low-hanging fruit offers dual benefits. Day to day, it boosts cash flow and operational stability. For those considering a sale, it maximizes EBITDA and positions the practice as an attractive acquisition target. By embracing AI-driven tools, your practice can achieve peak financial performance while continuing to deliver exceptional care. Start exploring these opportunities today to unlock your practice's full potential.
Ryan Mingus is managing director of Tusk Partners and has more than 12 years of sales and leadership experience in the dental and healthcare industry, most recently as the business development director for strategy and optimization at Align Technology Inc. Mingus earned his bachelor's degree in economics and business from the Virginia Military Institute and his Master of Business Administration from the University of San Diego. He also held the rank of captain in the U.S. Army National Guard.
The comments and observations expressed herein do not necessarily reflect the opinions of DrBicuspid.com, nor should they be construed as an endorsement or admonishment of any particular idea, vendor, or organization.
