I have the privilege of providing business coaching for dentists from all over the country. Over time, I’ve been able to identify some common misconceptions about running a dentistry practice that may seem intuitive, but in fact lead to counterproductive practices.
When you’re running a busy practice, time is your most valuable asset. But many dentists feel that in order to sustain and grow their business, they need to spend their time continually producing more and more dentistry while neglecting business management. Sometimes, dentists become so overwhelmed by the numbers that they simply abdicate the financial responsibilities to someone else. It may seem counterintuitive, but taking time to understand the core elements of your business is essential to sustainable growth.
Think about it. If you don’t have a grasp of what’s happening financially at the most basic levels of your practice, you won’t be able to make critical decisions that affect your...
One of the most important tips for business owners is to avoid temptation accounts. Now what exactly do we mean by that? Well, in this case, I'm talking about the temptation to borrow money from one account to fund another, or robbing Peter to pay Paul, as they say. While this may seem like a perfectly reasonable action, in reality, it means stealing for yourself to pay a bill or make a purchase for your business.
So what can we do to avoid this?
When an account is used for more than one purpose, it becomes too easy to pull additional funds from one purpose to cover for the other. To avoid this, the profit first model utilizes multiple bank accounts, each to hold money for one specific purpose. Another way to reduce the temptation to steal from the profit or tax account is to have different accounts set up at various banks across town so that it is harder to transfer money from Point A to Point B.
This temptation most often occurs when the operating expense account runs low...