THINKING BUSINESS
a blog by Chris Barrow

7 steps to financial confidence

Back in the 80’s…. Financial management in dental practice often consisted of a phone call to the bank on a Friday afternoon to check the balance. Accounts arrived once a year, months after the year end, with a narrative from your accountant to prepare you for a forthcoming tax bill. The Dental Payments Board sent a nice regular cheque as long as the right forms were filled in. Somebody had to sit and complete ledgers of money in and money out – meticulous handwritten notes and columns. Receipts and invoices accumulated in supermarket shopping bags, ring-binders and box files. Nowadays, dentistry has become a more complex business and it is essential for your own peace of mind that you are fully cognoscente of exactly what is going on. Computers and applications have taken over from paper and calculators. Here’s a list of the information that I INSIST my clients are able to access on a monthly basis:

  1. full management accounts (profit and loss statement) within 10 days of every month end

  2. a 12-month cash flow forecast

  3. budget figures replaced by actuals every month (and variance measured)

  4. Key Performance Indicators (KPI’s) measured and monitored against industry benchmarks

  5. Average Daily Production measured for all fee-earners

  6. Source of new patient enquiries monitored and offset against costs of each marketing activity to measure Return on Investment (ROI)

  7. New patient conversion %’s – enquiry to assessment, assessment to consult, consult to treatment, average value of treatment

Without these 7 steps, you are either flying blind or looking through a very opaque lens at what your business is doing. Our job at 7connections is to ensure that these 7 steps are implemented and followed by our clients – and then to coach them on how to respond to what the data tells them. If you want to double your profits in the next three years, you will need this information at your fingertips.

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