Starting a Practice: How to Write an Effective Dental Business Plan

Every business needs a dedicated business plan. Dental practices that are focused and prepared with a documented plan of action reach key milestones quicker, and can steer their business more effectively as it grows. Plus, without a dental practice business plan in place, you’ll find it hard to get funding.

Creating a thorough dentistry business plan isn’t as daunting as it may seem. Learn about all of the key considerations, best practices, and how to create your own dental business plan in our helpful guide.

Starting a Dental Practice Business Plan: Considerations

Writing a business plan for a dental practice is no different to compiling one for any other organization. However, the list of considerations varies depending on whether you are a new or existing practice.

Dental Business Plans for New Practices

Before you put pen to paper, work through the following questions to help you prepare:

• What will your new dental practice look like?
• Where is it located?
• What is your target market?
• What prices will you charge?
• How many competitors will you have?
• What are your competitors doing that you could do better?
• What is your growth strategy?
• Do you have a marketing plan prepared?

Dental Business Plans for Existing Practices

Updating a business plan for dental offices that are already up and running will require some additional details:

• Current financial position
• A list of debts owed, with updated lender details and payment terms
• An analysis of operational costs and your break-even point
• A financial comparison of your practice versus a competitor

Once you have all of this information, you can start compiling your dental business plan.

Dental Business Plan Template

Creating a dental office business plan may seem daunting, but it’s not as complicated as you might think. The beauty of a good dentistry business plan is that it’s a living document that can evolve as your practice grows and develops. It’s normal that some areas of your business grow faster than others. So as you progress you can even create separate dental business plan samples for each specialty split into general dentistry, orthodontics, periodontics, etc. Here is a breakdown of the sections you’ll need to cover in any thorough dental business plan.

Executive Summary

Although this is the first section of your dental office business plan, it should be the last part you write because it summarizes all of the other sections. It should cover no more than two pages and be written professionally in a way that is compelling to potential investors. Be sure to include a mission statement explaining the company’s purpose, why it exists, and the overall goal of operations.

Company Summary

State the location of the company, days and hours of operation, what services are offered, a breakdown of company ownership, and details about the following expenses and assets:

• Start-up expenses – Legal fees, stationery, deposit payments, office renovation costs, insurance, etc.
• Fixed assets – Dentistry equipment, furniture, computers, display cabinets, etc.
• Operating costs – Payroll, rent, utilities, equipment maintenance, practice management software, dental supplies, marketing costs, etc.
• Liabilities and capital – Current cash balance, borrowing agreements, outstanding bills, the balance on loans taken, etc.

Services

A detailed breakdown of every service offered and the costs for each. For example, a dentistry business plan for an orthodontist may list information and prices for braces, palatal expanders, and retainers. In contrast, a cosmetic practice may provide details about teeth whitening, gap removal, and veneers.

Market Analysis

A breakdown of your consumer market is a vital component of any business plan. Dental practices typically segment customers into three categories — children, adults, and seniors. Record how your current market split matches your intended target market, including details on income, lifestyle, and any other relevant factors. This will help improve your marketing plan.

Competitor Analysis

Collect as much data about your competition as you can, including how they manage their online presence, what digital platforms they are active on, their website SEO rankings, and any other relevant information that will help you develop a plan to beat them.

Strategy

This section maps out exactly how you intend to achieve your goals. To do that, you’ll need to consider and stipulate your:

• Unique selling points (USPs) – The tactics you will use to gain a competitive edge, like customer service, quality, affordability, etc.
• Marketing strategy – What dental social media marketing channels and techniques you will use to attract and retain patients.
• Sales strategy – How you’ll sell, upsell, and cross-sell your products and services, and what dental insurance policies you’ll accept.
• Milestone targets – Specific targets you wish to achieve within a designated time frame.

Management

Every dental business plan template should explain how the practice will be managed. Include a complete list of personnel, their qualifications, and responsibilities. In addition to full-time employees, you can also list business associates like insurance agents, real estate advisors, and attorneys. Always add a personnel plan for staff that are still required if your team has current vacancies.

Financial Plan

This is one of the most important sections of your business plan and should be presented in great detail. You should include:

• Historical financial analysis
• A projected income forecast for the following 12-24 months.
• A cash flow forecast
• Your personal financial statement
• The total funding required for the next 12-24 months.
• Offered collateral
• Details on how funds will be allocated

You’ll also need to include supporting financial documents, which should be a maximum of 90 days old to comply with current lending guidelines:

• Financial statements
• Copies of credit reports
• Individual income tax returns
• Business income tax returns.
• A copy of the aging schedule

Conclusion

We hope this business plan dental practice sample will help you develop a detailed and actionable plan for your clinic. As your patient base grows, you’ll need to partner with an efficient practice management system. Cloud 9 Software specializes in innovative orthodontic practice management software that helps businesses optimize for success by improving staff productivity, user efficiency, and workflow processes.

Get in touch today or book a demo to learn how our cloud-based solutions can help your business grow.