Overhead Expenses for Dental Practices

According to the American Dental Association, dental office overhead expenses can cost as much as 90 percent of gross billings. Overhead expenses are indirect costs that are necessary to keep your business going and can include fixed costs and costs that are variable. They can quickly add up, too. So, it’s important to pay attention to plan ahead and identify overhead expenses for dental practices so you can budget for them. Here are some common ones you should know and how you can budget for these expenses:

Your patients and your office will require support for managing patients’ billing, helping you with marketing, providing customer service and other services that indirectly impact the dental services you provide. So, it’s critical to account for the cost of your supporting staff’s wages. Consider how many clients your business sees on a monthly basis and your projected growth for the year to determine how many staff members are needed. By doing this, you can create better staff schedules and improve your budgeting efforts for saving on overhead expenses.

Overhead equipment expenses can include anything from the overhead lights to your computers or new dental care technology. While these expenses are typically fixed costs, they can wear down over time and may need to be replaced. You can budget for these expenses by setting up a replenishment or replacement schedule. For instance, you can schedule to change out all computers every two years to make sure the staff is using the latest hardware without going over budget.

You and your team have to stay current on the latest technology and dental practices to provide the best services for your patients and to stay in compliance with state and local regulations or organizational standards. Thus, it’s important to consider training expenses as part of your overhead costs. You can budget for training expenses by researching the skills and practices your team needs to know and allocating for trainings that cater to those needs.

You’ll need to invest in marketing to attract new customers. You can budget for this expense by identifying your marketing goals, establishing a set budget amount and allocating for this as a monthly fixed expense. You can also participate in networks or discount dental savings plans, such as DentalSave, to attract more customers while staying within your marketing budget to help your business grow.

Running a successful dental practice calls for knowing typical overhead expenses. By being aware of these expenses, you can budget for them effectively.