I bet when you went to dental school, you didn’t learn about creating a business plan. And yet it’s critical for you to have one for securing the financing you need. Without a plan, after all, how will lenders know what you’re doing with their money?
While a business plan is essential to starting your business, try approaching it from a slightly different angle: as an anchor to keep you grounded. Why? Because startups get messy and without the right planning, they can quickly grow beyond your budget.
Including the basics
Business plans don’t have to be complicated documents hundreds of pages long. At a minimum, your business plan should include:
- Your mission statement
- Demographics of your ideal patients
- Specifics about the services you’ll offer
- A thorough market analysis, including competitive research
- Information about your employees
- Your marketing sales and goals
- Your financials, including your startup costs and operating expenses
Start with your mission statement.
Tell the story of your practice. Your mission statement gives you the opportunity to articulate the purpose and goals of your practice and show the community its value. A mission statement also helps to set expectations for patients and unify your team.
Provide the demographics of your ideal patients.
First, let’s define what I mean by “ideal patients.” When I talk about ideal patients, I’m referring to the most profitable patients for your new practice — and your ideal patients may differ tremendously from another practice’s patients, including one of your competitors. By analyzing their demographics, you’ll be able to identify which patients will visit you most frequently and spend the most. Identifying and understanding your ideal patient empowers you to customize your marketing efforts and maximize your marketing budget.
Offer specifics about the services you’ll offer.
The type of services you provide depends on several factors — what the competition offers, what you’re trained in, and what you see that patients in your area might need, and which might currently be lacking. You’ve likely already decided what services your practice will provide. Include an explanation of those services in your plan.
Conduct a competitive analysis.
Your bank, partners and/or investors will want to see data on your competition. This evaluation gives you a solid picture of the area where you’re opening your office, too, and that’s important. You don’t want to overlap all of your services with the office down the street, for example.
Discuss your staff.
In this section, enumerate how many dental hygienists, dental assistants, and any other administrative staff you’re planning to hire. If your practice will include associate dentists — whether initially or in the future — include them, too. Identifying your full staff will help create a picture of your practice’s size and function.
Add your marketing and sales goals.
When you’re conducting your market analysis, check out the competition’s marketing strategies. What’s their online presence like? How high do they rank on search engine results pages (SERPs)? You’ll want to create a detailed marketing strategy for your own practice, including website design and a wireframe or content map, and SEO. If you’re using a different approach than your competitors, explain why.
Want to really get a leg up on the competition? Take a patient-first approach by applying what you’ve learned in identifying the demographic you’re targeting to address potential patients’ needs in each stage of the marketing funnel. You’ll have more success turning prospects into patients if you customize your marketing to them! Think about the value proposition you offer, and use that proposition to differentiate yourself from other practices. You’ll also want to sit down with your financial planner to calculate how much gross income your practice will need to generate to meet all your financial obligations and turn a profit.
Include your financials — startup costs and projected operating expenses.
These numbers connect to your marketing and sales goals. But where do you start? If it feels overwhelming, you can divide this section into two categories. Startup costs include equipment, insurance, taxes, payroll, licensing fees, retrofitting an existing building (if you’re renting or purchasing an existing structure), or a new build if you’re starting from scratch. Operating costs include ongoing payroll, employee training and professional development, marketing, rent or mortgage, front- and back-of-house supplies, insurance, maintenance and repairs, and utilities.
The good thing is it won’t cost you millions of dollars to open your dental practice, although your budget can range anywhere from $250K to $500K and more. But many factors go into that cost. You want to balance cost savings with growth strategies that work. Why? Because by aligning cost and strategy with vision, you’re more likely to succeed.
I can help with that, because my goal is to leverage my 20+ years of experience in the dental industry to help you define your goals, balance your cost, vision and finances, and open a successful dental practice that will enhance the community and grow over time. Learn how.