Why is successful cash flow such a mystery to so many dentists? Dr. Chris Salierno has been there, and he's figured out a few things he wants to share with his peers.
Where is the money? Cash flows into a practice and, most definitely, it flows right back out. Along the way, hopefully some of that money streams into your pocket. I use the word “hopefully” because directing the cash currents is no easy task.
In a few weeks I’ll be presenting “Taming the Overhead Beast” at the first DE Principles of Practice Management conference. The subject of overhead is part of the cash flow dilemma; overhead costs are the cash that flows out of your practice. But part of my lecture will look at the cash that is supposed to be flowing in. The basic methods of increasing the flow in are producing more dentistry, raising our fees on the dentistry we’re already doing, and improving the collections on the dentistry we’re already doing.
Here’s a ridiculously simple system to evaluate: asking for payment. I recently went for my annual eye exam at a charming boutique optometrist’s office. After a thorough check up, the receptionist wished me a pleasant day as I was leaving. “Can I leave a payment?” I asked. “Oh, we can just bill you if you prefer,” she replied. I had to convince this person to let me pay the office. Does your office allow patients to walk out without paying? A surprising number of practices don’t figure this out with patients ahead of time and just send a bill in the mail. Think of that system as a kink in the hose that is supposed to be flowing cash into your practice.
By examining the cash flow process in greater detail we can figure out how to direct more of it into our profit. How money moves through your business need not be a mystery.
Cheers,
Chris
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