How do you perform against your competition?
Benchmarking for dentists and doctors
is the process of collating data for a specific similar group of businesses with the aim to being able to find averages, high, lows and trends for useful metrics that can help in determining how well your business is doing compared to others.
If you think about it, it’s the best way to really assess your successes and failures; if someone else is doing it better then why can’t you and what aspect of your business do you need to focus on to achieve similar results.
On the other hand, in areas where your business is excelling in terms of industry standards then this understanding and knowledge can also be put to good use; maybe business expansion.
It’s the data, not the identity! (It’s anonymous)
A key point to note is that benchmarking is completely anonymous. It is the data that is important not the identity, which makes it highly attractive for business owners. This applies particularly to doctors and dentists who operate in a “micro-cosmos” where everyone knows everyone and most of whom don’t want their personal details shared with anyone but their spouse, business partner, trusted accountant and financial advisor.
Key financial metrics for benchmarking
Essentially, any financial data can be analysed and calculations made to determine trends. Typically though there are key statistics that are of high interest to dental practice owners and medical consultants:
- Total treatment income
- Treatment income from associate
- Gross Profit in £ + Gross Profit as a % of income
- Net Profit in £ + Net Profit as a % of income
- Staff costs as a % of income
- Premises costs as a % of income
- Total business costs
Comparing like with like: Collating data
Financial data can be mainly collected from financial statements and / or management accounts, as long as they are up-to-date and accurate.
Sometimes additional information is required to make the results more specific, for example, business location or number of partners.
Again, this can be kept anonymous but it saves comparing a 5-partner city dental practice in central London to a sole practitioner village dental practice in Somerset, for example. You want results that are as closely related to your current set up as possible.
Key practice and patient metrics for benchmarking (H1)
Apart from financial metrics, there are also many statistics relating to the management of your practice and your patients that can also be used for benchmarking, such as:
- Total number of patients
- Patient profile (age, gender)
- Average value of patient (£)
- Average lifetime of patient at practice
- Number of new patient enquiries
- Number of new patients
- Conversion % of new patients
- Source of new patients (i.e. referral, word of mouth)
- Return on investment (new patients as a % of marketing budget)
Your in-house practice management system
Data regarding patients and new patients is harder to obtain unless you are doing your bit.
Every dental and medical business owner should have a record of his or her patients in a database. The same applies to the new client process. This is unrelated to whether or not you are interested in Benchmarking; it’s for your own business strategy.
A good practice management system will be able to extract information about your patients and new patients via weekly, monthly or annual reporting. Averages can then be determined for such metrics as suggested above.
Figurit work with over a hundred medical and dental practices and have access to both real-time and industry data for your sector. If you are interested in discussing a bespoke benchmarking report for your dental or medical business, contact the team today:
020 7376 9333
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