Wrestle with your Octopus

The toughest number in present day dentistry?

OCPUSPD

Operating Cost Per Utilised Surgery Per Day

(I have a client who calls this her "Octopus" - whatever works!)

1. Take a look at your profit & loss statement for the last quarter;

2. From total income......

3. Deduct variable expenses (cost of sales, cost of good sold, COGs)

   1. Lab costs;

   2. Material costs;

   3. Self-employed clinician's pay

4. From your Overheads, deduct any Owner's drawings

   1. Director's salaries;

   2. Director's pension;

5. What should be left is all day to day operating costs

   1. Including staff wages;

   2. Including debt repayments.

That's your Operating Costs.

Now divide by the number of clinical days DELIVERED in the period (empty chairs don't count, even if just one session is missed, deduct that session).

Those are your utilised surgery days.

So operating costs divided by surgery days delivered?

That's your Octopus.

Pre-Truss - benchmark would have been £350-400.

Post-Reeves - benchmark is now £650-£750.

And that's just benchmark - I'm seeing plenty much higher.

A HIGH OCPUSPD IS KILLING YOUR PROFIT AND CASH FLOW.

So the challenge in this economic cycle is to keep your Octopus as low as possible.

How?

• Option 1 (the mainly pointless option) - try and reduce your operating costs - good luck with that;

• Option 2 (the smart option) - increase the following:

  • Number of chairs 

    • (expansion plan - yes - even this year - if you build it, they will come);

  • Number of hours chairs are occupied 

    • (yes - 8 until 8, 5 days a week, 8 until 4 on Saturdays and Sundays - if you open it - they will show up);

  • Average daily production of fee-earners 

    • (yes - if you train, consult, coach, mentor and shadow - they will produce);

  • Prices 

    • (yes - if you put your prices up - enough patients will pay).

It's time to wrestle with your Octopus - ignore at your peril.

If you are stuck, I can help - I'm a fully-qualified Octopus wrestler - coachbarrow@me.com