Is Dentistry Riding the Economic Storm?

March 26, 2015

Challenges Ahead

The dental profession is acutely aware of the challenges within the industry as we have lived with them since the downturn in NHS profits in 2007/8. These challenges are set to continue with the uncertain economic times we are experiencing and the prospects of NHS contract reform. Prototype contracts are presently underway. Their development has been informed by engaging with the dental community. However, this consultation is not guaranteed to influence the end result or work in our favour financially or otherwise.

Thank goodness, then, that the National Association of Specialist Dental Accountants and Lawyers (NASDAL) have published a report showing that private dental practice profits have crept ahead of NHS net profits for the first time in almost a decade.

Across a sample of 600 practices in the UK, the average NHS practice makes a profit of £129,000 per principal compared with £131,000 for private practices.

Ian Simpson, Chartered Accountant and partner of Humphrey and Co, who put the figures together, said

“Fee income is up by £7,000 per principal in a typical NHS practice and by £23,000 in a typical private practice.”

Riding the Storm

Perhaps then, dental practices are riding the economical and political storm!? With NHS contracts and UDA activity relatively unchanging over the years, are Principal Dentists and their management teams seeing the light? Are they now recognizing the importance of robust business planning and strategic management in surviving these high seas? Are they implementing a business approach in order to ensure their systems are watertight? It would appear so. How else would we be seeing increased prosperity within an industry that has been swimming against the tide for so long?

Survival

For me, as a Practice Management Consultant, this is music to my ears. Survival is the struggle to remain in existence. It is the focus on self-preservation and warding of predators that may threaten your subsistence. It would seem that as a profession we are implementing systems in practice that defend what we cherish and have worked desperately hard to build. Strategic management is the way of the future. It is the single thing that will defend your practice, strengthen its resilience and lead you through troubled waters to safer ground. Long may it last!

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