Coronavirus Economic Fears – 4 Proactive Steps to Flourish in Uncertain Times
By Amy Morgan on March 30, 2020 | comments
I was recently flipping through dentistry journals, I saw the first advertisement using the “R” word: recession. It was being used to scare dentists into “buying now.”
This immediately signaled to me that dentists who have been voraciously reading and watching every news story focused on the prospect of an economic downturn due to the coronavirus crisis are prime candidates to start to panic and blame the economy for all that is wrong with their practice.
It is easy for a dentist, as a small business owner, to get wrapped up in the drama of the news headlines and mistakenly blame their practice problems on the economy.
In my 26 years as a dental consultant, I have certainly had an opportunity to hear about the ills that an economic downturn may create. I have learned that there are some basic truths that prove beyond a shadow of doubt that dentists who actively engage in their business can survive and, dare I say, prosper, during just about any economic twist and turn.
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The first and most important of these truths is that dentistry is relatively recession, depression and any other type of financial disaster proof. Why? Functional and cosmetic dentistry are always in demand. There will always be patients who desire ideal oral health and are willing to pay for great care. Dentistry, in contrast to medicine, is defined as high-frequency/low-cost. If we compare quadrant dentistry to how much an emergency room charges for a couple of Tylenols and an X-ray, the facts reveal themselves.
Most importantly, even if we currently are in an economic downturn, we’re dealing with the baby boomer peak population. The boomers (including me) are at their highest level of need when it comes to restoring function and maintaining esthetic excellence as a tool to hang on to youth. The bottom line is, there are patients out there who will want and pay for your services. It’s your job to find those patients, discover what they need and want, and then present dental solutions in a way that they can commit to and value.
Another important point is that very often it is the dentist’s decisions – made in panic – that creates scarcity, chaos and failure, and not the situation itself. For example, the advertisement in the dental journal that stressed the “R” word was promoting an item that a stressed dentist in a panic might misperceive as a silver bullet for a bad month.
I am not judging the value of the advertising campaign itself. I am judging the dentist’s decision to purchase based on fear and lack of a plan. Without a consistent brand identity, a strategy with planned results and, of course, a proactive focus on a return on investment – the chances of a panic campaign being successful are slim to none. As a cash flow crisis consultant, I can honestly say every dentist I worked with who was being crushed by massive past-due payables and large credit balances started with a bad month and a subsequent bad decision or two.
So, when there is the fear of scarcity going on, what’s a dentist to do? There are four distinct, proactive actions that you can take to not only protect your practice from economic instability but also ensure success. I am 100% certain that by embracing and following these steps, no one ever has to lose. Where do you start?
Know your numbers (statistics) intimately
That’s a pretty general statement, so to make it more specific – which numbers are most important to be aware of during economic slowdowns?
Since scarcity very often trip-switches a dentist’s desire to see an immediate increased new patient flow, it is vital to know your:
- Regular active patient base (any patient seen for anything in the last eighteen months, counted once)
- Your new patient numbers
- Your treatment presentation numbers, as well as the traditional production, collection and expense numbers
The statistics are essential so that you as a business owner can make informed decisions based upon sound strategies, not judgment. For example, if you feel that you need 30 new patients a month and are willing to spend $60,000-$100,000 a year to get them, how would you know when you have returned your investment?
Are those 30 patients presenting the kind of dental needs that fit your practice’s vision and values? Are they committing to treatment, following through on financial arrangements and referring others? If a dentist doesn’t know the answers to these questions, he/she could have hundreds of new patients and wind up producing less and realizing no true ROI.
Know your patients
We have all heard that old saying, “Don’t assume anything ...” There’s nothing worse than a dentist diagnosing a patient through their pocketbook. The only way a practitioner can find out what motivates and concerns patients is to ask questions, exhibit empathy and create a treatment plan that accommodates their needs. Sometimes it’s important to acknowledge a regional issue.
Many of our dentists who have experienced regional economic downward trends have sent out what we call “state-of-the-nation letters” as a proactive marketing tool. These letters assure patients that even in uncertain times, their dental office will always deliver the very best clinical care and address the economic obstacles by offering flexible financial arrangements. Your relationship with your patients is the strongest good will you possess. Patients who trust you will always rise above financial concerns to seek optimal oral health.
Adapt your systems
In an unstable economy, a patient could say “maybe” to discretionary dental care but will still say “yes” to functional or basic oral health necessities.
Instead of targeting 12 full-mouth reconstructions per year a practice may need to do 24 cases of $3,000-$5,000 instead. A flexible dentist may need to change their marketing, new patient screening and new patient process or treatment presentation for patients of record to address the concerns of the day. Financial arrangement systems may need to become more flexible and insurance processes may need to become more efficient. All should be addressed proactively versus reactively when you are knee-deep in the hoopla of goals not being met.
Stay the course
The good news for dentists is that while a restaurant or retail store can truly fail when the economy shifts, when you do the right thing for the right patients you will flourish and prosper.
A bad month does not mean a bad year. Three patients that say “no” does not mean that the fourth patient won’t say “yes.” Your goals and your strategies, if they have worked in the past, can work again.
So, don’t hit the panic button. Reengage with your business proactively, respond to outside influences and you can be successful and never fear the “R” word again.
Amy Morgan is Vice President of Consulting Strategy, a member of Spear Resident Faculty and former CEO of Pride Institute.