COVID-19 has changed dentistry faster than any crisis in the past, and we still don’t know how everything will play out. But the fact is that any dental practice can face any crisis at any time. Fire, flood, lawsuit, key employee resignation, a bad month, a bad quarter, an expensive purchase that turns out to be really bad, and more have plagued dental practices since their beginnings.
Owning a business carries risk. There are dentists who opened their doors right before the 2008-2009 great recession or before the onslaught of COVID-19. There are dentists with mature practices that were wiped out by a hurricane or tornado. The list of examples goes on.
But the truth is that most dental practices have never faced a true crisis. Therefore, most dentists have never prepared for one. Even if you had done a SWOT analysis (strengths, weaknesses, opportunities, and threats), it is very unlikely that you would have identified a worldwide pandemic in the “threats” category.
But here we are.
Learn the lesson
We know that dentistry is not full of guarantees. We learned that lesson back in the 2008-2009 recession, when 75% of dental practices had production declines for a period of almost four years. Then the good times returned. There was a great economy, money flowed in, and things looked great until . . . the next crisis.
COVID-19 is a lesson for us. It is going to take time for practices to bounce back. Every practice is currently facing a business turnaround. Most will recover and eventually return to the next normal. If a definitive treatment or a vaccine is created, then practices will reemerge with strength and will gradually build back to high levels. There are always some winners when this happens, and they are usually the ones that have prepared and acted early.
Back to basics
There are certain basics that have always helped small businesses—where most dental practices fall—become successful. Hard work ethic, excellent customer service, monitoring and controlling expenses, and being fiscally responsible are good examples of those basics. But ahead of any of these is cash, because we all know that cash is king.
Practices with cash can build a fortress around themselves. Dentists do not need six-foot granite walls or cannons that stick out of turrets. What they need is cash, which is the fortress for most small businesses. Dental practices are not Fortune 500 companies. They do not have massive lines of credit or banks racing to give them millions of dollars in loans. They do not have the opportunity to go public and raise money by selling shares or buying those shares back. They are dental practices that are bound by the basic laws of small business economics.
Prepare for the next crisis
Dental practice teams are now back at work. At a time like this it is all-hands-on deck to recover from this crisis. It will be a while until the basic economy figures out how to recover from the pandemic.
But dentists should be learning the lessons now. Recent crises such as dams breaking in Michigan, hurricanes hitting the Gulf Coast, and large protests taking place in 40 cities make it clear that crises are part of our lives and they don’t wait for permission to strike. Practices need to do everything possible to create the best systems, have the best teams, and remain fiscally sound, and this includes cash reserves. This is the only way that practices can prepare for the next unknown crisis. Here’s hoping it does not strike anytime soon.
ROGER P. LEVIN, DDS, is the CEO and founder of Levin Group, a leading practice management consulting firm that has worked with over 30,000 practices to increase production. A recognized expert on dental practice management and marketing, he has written 67 books and more than 4,000 articles and regularly presents seminars in the US and around the world. To contact Dr. Levin or to join the 40,000 dental professionals who receive his Practice Production Tip of the Day, visit levingroup.com or email [email protected].
