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The Profitability Tipping Point

Escaping Gravity

Fred Joyal, founder and former CEO of Futuredontics, the parent company of 1-800-DENTIST, uses a metaphor from NASA to explain what happens when a dental practice “escapes gravity” and reaches the tipping point of profitability.

“When they launch a rocket into space, they use something like 50% of the fuel to go the first hundred miles. And then once they escape gravity, they use significantly less fuel. They will use less fuel to go all the way to the moon than they used to get out of the first hundred miles of earth gravity. This is a metaphor for the dental practice,” says Joyal.

A dental practice is a business model where there are large fixed costs and a small amount of variable costs. “Once you crack that nut, the margin is not huge on everything else you do. The problem is that a lot of dentists are always hovering at that. They don't experience escaping gravity.”

After the Break-Even Point

In any given month, what is the point where the next $10,000 you make nets you 70-80%? That's an amazing statistic. But most dentists are hovering around their break-even point says Joyal.

“I have had this conversation in the marketing context with many dentists about why they should spend $5,000 on a campaign.” They argue it will only bring in $20,000 in revenue and the overhead will cost them more than 75%. It makes no sense to them, says Joyal. What they miss is that they are at their break-even point and about to escape gravity, so the profitability margin on that $20,000 will be much higher.

When you are at that point, you have more money for marketing. You have the opportunity to offer a discount to a patient. You have the opportunity to do charity dentistry one day a month. All of those things contribute to propelling the practice upward. And you can do more marketing and take more patients at the high profit margin.

“Now, maybe you can bring in a treatment coordinator,” says Joyal. “She's going to help you convert the bigger cases and convince the person to finance $20,000 to $30,000 of dentistry. That's an 80% margin,” says Joyal.

Like  a Downhill Snowball

Joyal has witnessed the growth of profitability from increased marketing in the practices where he consults. The downhill snowball effect of escaping gravity takes practices to higher levels.  “Importantly, it gives you an opportunity to incentivize your team because the money is there to do it,” says Joyal. “You can use something like Patient Prism to convert more patients, to take those new patients and attract them and convince them to do more dentistry… You can also invest in technology that makes you more efficient, delivers better dentistry faster, and you're staying ahead of the curve. It just snowballs.” 

Joyal shares advice, tips and trends in his books. He is the author of “Everything is Marketing: The Ultimate Strategy for Dental Practice Growth” and "Becoming Remarkable: Creating a Dental Practice Everyone Talks About." 

About this Industry Leader:

Fred Joyal - Profile Pic

Fred Joyal

Author & Dental Marketing Expert, Co-founder 1-800-Dentist

Fred Joyal is the founder of Futuredontics®, the parent company of 1-800-DENTIST, and author of "Everything is Marketing: The Ultimate Strategy for Dental Practice Growth" and "Becoming Remarkable: Creating a Dental Practice Everyone Talks About." As the industry's foremost expert on dental consumer marketing, Fred has lectured at dental tradeshows nationwide and is a regular contributor to various print and online publications. He has also been awarded the Conrad Hilton Distinguished Entrepreneur Award by Loyola Marymount University, as well as an honorary Doctorate of Arts from the University of Rhode Island, and he sits on the board of directors for The Children's Dental Center of Greater Los Angeles. In addition, Fred writes a weekly dental marketing blog at GoAskFred.com, where he posts weekly with new ideas and changes and in marketing, social media and the dental world.

Drawing upon his 30 years of experience in dental consumer marketing, Fred Joyal shares the kind of relatable real-world examples, techniques and business strategies dental practices need to thrive in a competitive and increasingly challenging field. His popular lectures focus on achieving deeper patient relationships and maximizing production from new and existing patients.

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