Oct 25, 2019
Practice Under Water | Mystery Guest “Jim” Part I
At the Brink of Practice Extinction
Practice Under Water brings together dentist and dental practices into our interview space, with a twist! For our new Practice Under Water episodes, George and Matt will be diving (pun intended!) to the deep end of the swimming pool with mystery guests. They will ask them driving questions to find out how they are growing their business, mistakes they've made, and how our guests have made their comeback through trial and error. Practice Under Water is designed to enhance the dentist's lives by moving past difficulties to experience joy.
Today, Matt and I are going to plunge into our interview with a new mystery guest, who we call "Jim." He contacted us out of desperation with his new start-up practice quickly going downhill and bleeding out at the rate of around $10,000 per month, with maxed-out credit cards, no savings, and no working capital! His business is so slow, Jim has only had one crown in the first five months. Jim contacted Matt a couple years ago, Matt looked at his numbers, and his numbers looked great to start-up a new practice, based on the demographics of the area.
Digging in, we find out that Jim's biggest concern is his debt load. He took out personal credit card debt to get "fancy equipment" he wanted for his brand new practice. Jim didn't want to "spend too much time thinking about what is best and what I needed," which is evident in his practices. He admits to "just signing on the dotted line" when equipment reps would offer him a new tool to buy.
Matt finds out Jim's breakdown of outstanding debt: $260,000 of student loans, a start-up loan of $520,000, borrowed $50,000 to supplement his start-up loan, and $100,000 in personal credit card debt for a total of right below $1million in debt.
Matt also learns that Jim doesn't have a good idea of what his actual numbers are in his practice and hasn't front-loaded his numbers to find out what his budget is and what he can and can't spend money on right now - or even when he was starting his new practice. Jim hasn't kept any metrics to date and isn't sure how much he is bleeding out every month. His estimate of monthly costs to stay above water is around $20,000. With only averaging 20 new patients per month, Jim understands he needs to have more patients to, at a minimum, survive. He is currently working two days a week at an associateship to keep his business afloat. Although he does not like working there and would rather spend his time at his office, he isn't sure what he should do to make this goal happen.
Listen in to find out how Matt jumps into Jim's numbers, including his hours in his business and his calls to scheduling ratio. Find out how Matt's outside perspective can get Jim's business in shape and influence Jim to be more focused and intentional with his energy and how he is investing himself and his time in his practice.
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