Commonly referred to as the foundation of any business, business plans can be a crucial element to the success of your dental practice. While business plans aren’t always required, they are most definitely recommended for a variety of reasons we’ll cover shortly.
A business plan is a written document that covers, in detail, what your business’ goals are and how you plan to accomplish them. It covers everything from marketing to financial projections and operational viewpoint.
While there are some who are able to finish dental school and jump into business ownership on their own dime, many rely on alternative financial means. If you’re seeking a small business grant, a loan from a financial institution, pitching your practice to investors or even enlisting a business partner -r a business plan is required. When making the investment into your dental practice, investors and lenders want to know that you’ve done your homework and your practice is a sound investment. A business plan is the best (and sometimes the only acceptable) way of presenting the information to them.
A well-written business plan is like a road map: You can’t travel without one. Well, you can travel without a map, but it will increase the likelihood that you’ll end up lost along the way - just like a business plan. If you’re self-funding and choose not to have a business plan, you may also end up lost along the way. Owning a dental practice is a huge commitment of time and money, so why wouldn’t you want to do everything possible to ensure the success of your business? Still not sure? Here are a few ways that having a well-written business plan in place can help your dental practice find success:
Again, if you’re seeking to secure funding or real estate through investors or lenders, they want to know that you have a financially sound plan and that their investment will be protected. After the 2008 financial crisis, many lenders have become even more stringent in their process and may flat out refuse to consider your request without a business plan.
Your business plan will cover your team and business structure which can ultimately be broken down into three main sections: What is the legal structure of your business (i.e. Limited Liability Company, Corporation, Sole Proprietor, etc.)? Who are your advisors (accountant, attorney, consultant, insurance broker, etc.)? And third, who are you planning to hire and what role they will be filling?
This portion of your business plan can help you figure out staffing needs and job descriptions making hiring and expectations more manageable for your dental practice, ultimately creating efficient operations.
Owning a business is often an endless exercise in critical thinking and decision making, and dental practices are no different. Your business plan will force you to determine critical aspects of your business and can help you determine what the right thing to do is in those critical scenarios.
An example of this will be the dental services section of your business plan. Many choose to state they will be providing dental services. This is an injustice to you thatyour can hurt your chances of getting creative with your marketing plans. Are you working with pediatrics? Opening a family practice? General dentistry? Or will your practice be more focused on cosmetic dentistry? Are there certain specialties you’re planning to stay away from? Nailing down what exactly you’ll be focusing on can help solve future conflicts. Remember that your business plan is a living document, meaning that you can always make revisions or updates to it.
It’s easy to get swept up in the excitement of being a new business owner. The world is your oyster. While it may be an unwelcome thought, occasionally there are flaws, gaps or only partial ideas. Ironing out a business plan can help to identify those weak points and help ensure that you’re positioning yourself for the best way forward. It will force you to ask yourself some hard questions and to find impactful answers.
Business ownership is both exciting and daunting. It also comes with its fair share of risk. However, a business plan can help to mitigate some of that risk through identifying expense and revenue projections, understanding your market and the competitive landscape, logistics, structure and more. It is a plan for the key areas that can make or break your dental practice.
Through crafting your business plan, you can identify what needs to be done to get your dental practice up and running. There’s no right or wrong way to write a business plan, so don’t worry about drafting it a certain way.Position your dental practice for success with a well-written business plan. It is a great tool that many aspiring entrepreneurs use when making the decision to become business owners, regardless of whether you’re building a new dental practice or buying an already established one. Not sure how to get started? Dental B-School can help you along your path to business ownership, including a lesson on business plans in our 'Intro to Entrepreneurship' Module. For additional free resources, register for our FREE resource library, or reach out to our team to schedule a strategy session.