Creating effective business plans for your dental practice is essential for success! The plan should include detailed information on how to turn your goals into a reality, and should include market analysis, marketing, cash flow charts, competition analysis, and other such things necessary to achieve both short- and long-term goals. A business plan is an invaluable tool to assist your practice in forging a path toward long-term growth and success. You can follow the same general guidelines to create a business plan as other small businesses.
In order to begin a step-by-step guideline for you to follow toward success, have you considered describing in detail what you envision when you think of your dental practice? Do you have a specific marketing plan in mind? Who does your market consist of, and are they making the right or wrong choices for their dental health? How will you determine prices of services? What type of payment system are you considering for your patients? Do you have a strategy for the growth of your practice?
The first section of your business plan should include the executive summary. It is a short section that provides a summary of your business plans that would allow a reader to quickly learn the key points of the business and its main purpose, consisting of no more than two pages. The summary will be important when you begin to approach lenders for the dental practice. It should be both persuasive and compelling to entice potential lenders to fund your new business. It must express clearly the vision for your dental practice and how you intend to make it a success. Typically, it will be the final piece written for your business plan, as it will consist of a synopsis of all the areas of your plan, and will have to be put in order before placing it in writing.
Products and Services
There should also be a section setting out the products and services your dental practice will provide. If you intend to purchase a dental practice that is already established, make sure and list in detail the changes you intend to integrate as the new owner of the practice.
How will your dental practice be managed? Include this section in your business plan too. Will it be structured as a partnership, corporation, or limited liability corporation? A list of personnel, along with their responsibilities, should be included. List professional advisors such as the following:
- financial partners
- insurance agents
- real estate agents
- business associates
This will serve as proof to lenders that you have a plan for the functioning of the office and your support team.
Competitor Analysis and Marketing Plan
This section of your business plan should include any relative data about your competition in the nearby area. Moreover, include your competitors’ attempts at marketing and detail your own marketing plan. Provide an overview of your intended market and type of patients you intend to target. List such details as your prospective patients’ income level, age, and lifestyle. State precisely how you are going to make your dental practice stand out from the others in the community and attract and keep customers. Set out and thoroughly explain any approaches you intend to take in your dental practice. This section should include website design information.
This is the most important section of your business plans. A sound financial plan will be crucial to the approval of loan proposals by potential lenders. You should take care to plan this carefully and record it in great detail. Include any and all relevant financial information. Consider including items such as 12-24 month projected income, cash flow chart, personal financial statement, startup fund allocation, collateral, etc.
Include all supporting documentation a potential lender would need to review in order to extend credit to your dental practice. You may want to include present business financial statements if available, recent credit reports, aging account schedule if there is one, up to three years of financial statements, and prospective forecasts, cash flows, etc. Financial documents must be 90 or less days old. Only then will lenders consider it as current.
This section will detail all the day-to-day operations of your practice. It will be the last and longest section of the business plan. Provide all information that will allow lenders to see how your practice will function. Include such things as office hours, days of operation, equipment and supplies, suppliers list, equipment maintenance schedules, patient flow, and dental insurances you will use.
Dental practices which are already up and operating may need to update their business plans as well if they plan on expansion. Here are some of the covered sections:
- updates to the dental practice’s financial position
- current accounts payables
- current lenders
- competitor analysis
- cost analysis
The team at PPO Negotiation Solutions are trusted partners to hundreds of dental practices. With 30 years of experience, they have an impeccable reputation. Are you a startup practice, fee-for-service practice, established practice, looking to add an associate, or looking to purchase a practice? Contact them today to learn more about their process and get a complementary assessment and/or schedule a consultation!