There is much to do in preparation for the return of dentistry. For many practice principals, getting back to work safely means reorganising the practice environment, introducing new protocols and updating patient communications. From a business perspective, this also means getting finances in order and optimising economies wherever possible.
Utilise government support
The Job Retention Scheme has been extended until the end of October. On the whole this is good news for all UK businesses, as it should facilitate the gradual return of staff without leaving employees without any income.
Also benefiting an array of businesses, the Bounce Back Loan Scheme (BBLS) offers a new lifeline for any practices that didn’t get a Coronavirus Business Interruption Loan (CBIL). The BBLS offers up to £50k, interest-free for a year with no repayments, giving dental practices and associates a cushion. If you don’t end up needing the money, just repay it in 12 months’ time. However, if the extra financial support is necessary, you can repay the loan beyond the first year at a set interest rate of 2.5 per cent per annum for up to six years, with no penalties should you repay it in full at any time. This is available for each trading entity (if you have multiple practices, you can claim the loan for each one). Practices working as sole traders for NHS and limited companies for private work can also claim up to 25 per cent of annual turnover, by way of a loan up to a maximum of £50k.
There is also an opportunity to use the BBLS to repay smaller debts like credit cards, car loans or personal loans. The comparably lower 2.5 per cent interest rate for the next six years and the fact that interest is tax-deductible, could create a more effective financial situation than any schemes you currently have in place. It’s crucial to calculate the impact of either option carefully before deciding between business or personal debt. Creating a cashflow forecast for your business and for yourself is a good place to start.
When looking to remove inefficiencies in your outgoings, it’s necessary to consider staff pay. If any of your associates treat patients through payment plan programmes, did you pay them while the practice was closed? These patients pay for dental treatment over 12 months, so it’s possible that you paid associates for a few months’ work that they haven’t done. To protect the business finances going forward, you could ask your associates to sign a document that confirms they will pay back a proportion of these monies should they decide to leave their post within the next 12 months or before all their payment plan patients have been seen.
You may also need to review general remuneration for some of your self-employed team members. It’s vital that this isn’t about renegotiating associate or dental hygienist contracts. Instead, it should share the recent downtime and resulting costs to the practice among all those who would benefit from its profits. This will once again protect the business in the upcoming months, in turn protecting the jobs of these and other members of staff.
To further encourage efficiency and improve revenue, some practices might consider scattered appointment times for dentists and dental hygienists to share the workload. This could optimise the diary and allow maximum number of patients to be seen safely.
Another avenue is to consider virtual appointments where appropriate, such as for orthodontic consultations or sessions with the treatment coordinator. There has been a boom in technology and software of late that facilitates virtual consultations and remote treatment monitoring. Embracing some of these solutions could help to reduce practice costs while offering added value for patients. This approach also provides a way for patients who might be anxious about visiting the practice to enquire about treatment and start forming a relationship with a member of staff from the comfort of their own home.
Stay positive and pragmatic
With a lot of conflicting information and advice circulating, it’s important that you assess your own situation and take a rational approach for your practice. Use your cashflow from financing activities (CFF) to make good business decisions. It is also crucial to stay positive – if you expect a bad outcome you find the road to recovery far more difficult.
The dental market as a whole appears stable – perhaps moving slightly slower than normal, but still moving. People will always need dental care, so dental practices will recover from this. As far as I can see, there is still an appetite for practices, with only one group pausing acquisitions. It will be interesting to see whether a preference for NHS practices over private returns after a change-around earlier in the year. For now, positivity and pragmatic planning are key.