The foundation to growing your practice is a solid growth plan, but what is the backbone of the growth plan? There’s a lot more to it than just chance. If you’re ready to start looking at what makes a successful growth plan, then grab your calculator, because it’s time to start crunching the numbers.
What would you consider to be the most important part of your practice growth plan? You might think it’s direct advertising or great offers to draw in new patients, but before you can even start thinking in that direction, you’ve got to go back to the basics. If you take a look at these eight items to measure, you’re off to a good start. But, first things first…you need to understand what you’re measuring.
The First Step: Establish Your Measurement System
You track all sorts of numbers – new patients, number of total patients, etc., but if you’re not making those numbers work for you, then you’re missing a critical part of your growth plan. Before you can even start building your plan, you have to get your measurement system in place.
Just think, less than one-third of the practices out there accurately track their source of new patients, and even less than that track the marketing costs tied to getting those new patients! If you don’t know where your new patients are coming from or how much it’s costing you to get those new patients, then why bother tracking at all?
Bottom line: if you’re not measuring these metrics, then don’t invest in more marketing, because you don’t know what’s working or not. Think of it as throwing spaghetti at the wall – if you’re tossing everything at your marketing plan but not looking to see what’s working, just think of how much money you’re throwing down the drain each year.
The Five Things to Measure
There may be eight metrics that lay the foundation for successful practice growth, but we can break it down into five items to measure and three things to calculate. Let’s look at what you need to start measuring, so you can make the most of your marketing budget:
Measuring this one is easy — simply count the number of new patients input into your practice management system.
Sources of New Patients
If you remember from our “How to Generate More New Patients for Your Dental Practice” blog post a couple of years ago, we broke down all the ways you can get new patients:
- A Custom Dental Website
- Patient Referrals
- Internet Search
- Dental Insurance
- Paid Marketing
- Community Outreach
You can track these numbers daily. It’s time to think about ways you can find out this information, as this will be a piece of how you invest your money into your practice going forward. This will require a little work on your end, but it’ll be worth it.
Take your marketing expenses and start lumping them into these same categories of new patient sources – then, you’ve got an easy way to determine the cost and new patient number for each category by month!
This is an easy one! You have the numbers of how many patients came into your practice throughout the month.
This is another figure you should easily have at your disposal – this is your total practice revenue.
Of the five items mentioned, you already have three of these (New Patients, Total Patients, and Production), so all you have to do is roll up your sleeves and work on the other two: Sources of New Patients and Marketing Expenses.
Don’t have those figures? Don’t worry – you’re not alone. Three out of 10 dentists don’t have those numbers on hand, but you have an opportunity to break that cycle.
The Three Items to Calculate
Next, take those five items you measured and actually do something with that information.
Grab your calculators, because now it’s time to look at the three things to calculate. Do this and you can create a growth plan that works for your practice!
Production Per Patient
Take your production number and divide it by the number of patients seen to get your production per patient. Just remember – this is your baseline.
Production Per New Patient
Now, wash, rinse, and almost repeat what you did in the first item – this time, divide your production number for new patient services by the number of your new patients seen. This tells you how much revenue you’re generating from new patients.
Cost Per New Patient
When you look at your sources of new patients and the marketing expenses to get those new patients, you can start calculating how much you’re spending to get those new patients in the door. Once you have your numbers, this allows you to consider spending your money in one area over another because you get a better value that way.
How Do You Get This Information?
This is an easy fix. Designate a New Patient Champion in your practice; they’ll present new patients in your morning huddle, so everyone knows who’s new on the scene. Then, as you engage with these patients, ask questions about how they heard of the practice. Report your findings to your New Patient Champion so they can track it in the system, and you’re well on your way to building your metrics!
Once you start going through these metrics and determining where your money’s going, now you can start building your marketing plan! But, if you’re not sure where to begin or need help with calculating your figures, give the team at TNT Dental a call today, and we’ll help you create the growth plan you need to take it to the next level.
About The Author
Tim Healy is one of the founders of TNT Dental, the #1 creator of custom websites and marketing strategies for dentists. Recognized as a leading expert in helping dental practices attract new patients, Tim has a true passion for teaching dentists the important “business stuff” they do not teach you in dental school. If there is anything Tim can do to help you, please do not hesitate to contact him directly at the office, (877) 868-4932, on his cell, (214) 680-1270, or via email at email@example.com. Of course, you can always visit www.TNTDental.com to learn more.