Overview
Understanding the operating costs of your dental practice is essential for running a stable and sustainable business. While financial statements such as the profit and loss account offer a summary of overall performance, they rarely provide the depth of information needed to make day‑to‑day management decisions. By breaking your costs down further and analysing them in a structured way, you can build a much clearer picture of how efficiently your practice is operating and whether current pricing levels are sufficient to support the growth and sustainability of your business.
Detailed operating cost analysis forms the foundation for a wide range of strategic decisions. It will enable you to assess whether your current private and plan fees are appropriately set, identify pressures on profitability, and understand the true cost of delivering the care you provide in each surgery. It also helps to highlight inefficiencies, such as under‑utilised rooms, rising consumable costs, or non‑clinical overheads that have grown over time, giving you the information that you need to make informed changes to how your business operates.
This advice explains how you can analyse your practice’s operating costs and convert those figures into meaningful, practical, measures that reflect the real demands of running a dental practice. These include the cost of operating each surgery, the average cost per clinical hour, and the level of revenue required per clinical day to maintain financial stability. Understanding these indicators will give you the information and insights you need to be able to benchmark performance, plan your staffing levels, and schedule more effectively. This information will also help to support evidence‑based conversations with your associates when you are reviewing licence fees or discussing income expectations.
We have also produced an operating costs calculator, which guides you through this process. Using this will give you a practical framework that can help you to set appropriate fees and ensure that your practice remains commercially viable.
