If you want to focus on taking care of your patients, you’ll need to track key performance indicators (KPIs) to keep your dental practice headed in the right direction. While there are many ways to measure the success of your dental practice so you can grow and diversify, these quantitative results will help you improve profitability and increase efficiency.
Patient demographics
Yes, it’s important to know what your average patient looks like, but how did they find you in the first place? Determining if they’re referrals or came from social media advertising or organic search engine optimization (or SEO) will help you allocate your marketing budget to the right source and medium. From there, you can calculate how much you’re spending to acquire each new patient and double check to ensure that cost is optimal.
You can also then calculate how much your patients are worth each year based on how many visits to your dental practice they make. Finding the average number of visits among all patients will help determine how you compare with the rest of the industry and unearth any underlying concerns at your dental practice. Use that data to track how much the average patient is spending and the repeat visit rate to see if your hourly rate needs to be adjusted.
Financial statistics
Working capital is determined by subtracting your practice's debts and liabilities from your assets to allow insight into what liquidity you have to grow your business and increase profitability. For equity, compare your practice's assets divided by your liabilities, as well as determine your practice's effectiveness to convert assets to profits. Likewise, the accounts receivable turnover ratio quantifies how much payment you're receiving within a certain period of time, and the accounts payable turnover measures the rate your practice pays off its debts. Lastly, you'll also want to calculate the ratio of full-time employees to part-time employees, freelancers and contractors.
Patient satisfaction
At the end of the day, it's important to know where you stand with your current patients. To get a pulse on this, you could send out a simple survey via email to rate how likely they are to recommend your dental practice or ask for a Google review. After all, patient care is the reason you got into dentistry in the first place, and your patients are your best salespeople!
Conclusion
It's easy to get wrapped up in the day-to-day responsibilities of running your dental practice, but unless you're taking stock of important KPIs, you're likely missing opportunities to take your dental practice to the next level. How are you tracking success at your dental practice?