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Formula of profit at dental business
Let’s talk about increasing profits in dental business. Most likely, you exert some effort, but in most cases this approach is unsystematic.
Other words, you do something but there is no good structured process, there is no understanding what action entails this or that result. You do things chaotically and try to do everything at once. Fortunately, there is a fundamental formula of profit, which puts everything in its place.
So here's the formula: Profit = L · Cv · S · F · x%
L - the number of potential customers;
Cv - conversion;
S - the average bill;
F - Frequency of visits;
x% - Your premium.
The formula shows that your profit depends on 5 factors
1. The number of potential customers. These are the people who have not yet benefited from your services, but you know nothing of. They either call you or come on a site of your company, or just passed by and looked into dentistry. They have already shown interest in your services, in principle, can choose your clinic.
2. Conversion. It is a measure of the percentage of potential customers become customers real. For example, if you call 100 and have come into your dental only 20 patients, then your conversion is 20%.
3. The average bill. One patient spent of $ 400, another paid $ 800. Summing up all the proceeds of the day, and dividing it by the number of patients, you know how much the average patient spends per visit.
4. The frequency of visits. This ratio shows how many times over a distinguished period of time comes to you one the same person. If we take the year, it appears that the same customer comes to you twice. Perhaps more likely, may be at least but it is calculated as the average value.
5. The last fifth factor is your premium. It is a measure of how much money goes to you personally as the owner of dentistry.
This formula really works. If you calculate each of the coefficients for a certain period of time, such as a year, and then multiply them together, the result you get your income is the money that you actually have at your disposal.
What are the benefits and practicality of this formula?
You will learn in our next article: How to increase profits in dentistry
In the next article: Dental Marketing: How to increase profits in dentistry