7 Important Considerations for Dental Practice Cash Flow

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Dentists are integral to society for various reasons. Without them, people will have difficulty maintaining their oral health. For this reason, everyone is encouraged to visit the dentist when recommended. However, dental practices are still businesses, so dentists charge patients for their services or treatments, which is necessary to keep the practice operational.

However, a dental practice’s cash flow is not always consistent. There may be times when the practice has more money coming in than it does going out and vice versa. This is why dentists often offer financing options to their patients. Of course, this won’t be possible if daily expenses aren’t considered, which is why dentists must be mindful of their spending.is why dentists need to be aware of their spending.

For this reason, a dental practice must consider certain factors to determine its cash flow. These include:

#1 – Employee Payroll

First and foremost, a dental practice’s cash flow will be determined by employee payroll. Employees must be paid regularly, which can strain a practice’s finances if not managed properly. To ensure that employee payroll doesn’t negatively impact cash flow, dentists must be mindful of how much they spend on salaries and benefits. They also need to ensure they’re not overstaffed, leading to unnecessary expenses.

#2 – Dental Equipment and Supplies

Another factor impacting a dental practice’s cash flow is the cost of dental equipment and supplies. Dental practices need to replenish their supplies, which can be expensive when done constantly. They also need to maintain and repair their equipment, which can be costly. To keep expenses down, dentists should purchase only the necessary supplies and carefully maintain their equipment.

#3 – Office Supplies

Office supplies aren’t like dental supplies because they’re not directly related to patient care. However, they are necessary for the day-to-day operation of dental practice. Office supplies include paper, pens, and toner for the office printer. Although office supplies aren’t as expensive as dental supplies, they can still add up over time. To keep office supply expenses down, dentists should only purchase the supplies they need and buy them in bulk when possible.

#4 – Marketing and Advertising

Dental practices need to market themselves to attract patients. Marketing and advertising expenses include print ads, online ads, and TV commercials. Marketing and advertising can be expensive, but a growing dental practice is necessary. To keep marketing and advertising expenses down, dentists should carefully plan their marketing campaigns and track their results.

For example, if a practice spends $500 on a newspaper ad and only gets two new patients, it’s not a very effective use of marketing dollars. On the other hand, if the practice spends $500 on a targeted online ad campaign and gets 20 new patients, it’s a much more effective use of marketing dollars.

#5 – Facility-Related Costs

Dental practices need a place to see patients. The cost of the facility can be high, especially if the practice is located in a high-rent area. The facility’s price includes the cost of the building, the land, and any improvements or renovations.

The cost of the facility can also include the cost of furniture and equipment. Dentists should carefully consider the cost of their facility when choosing a location. A dental practice located in a high-rent area may have higher overhead costs, but it may also have a higher volume of patients.

#6 – Business-Related Costs

Dental practices need to be insured and licensed. Insurance and licensing costs can be significant, especially for new dental practices. Of course, business-related prices could also include the cost of marketing and advertising, which can also be high.

#7 – Lab Partnerships

If a dental practice offers dental implants, they may need to partner with a dental lab that can provide the necessary services. The cost of a dental implant procedure can be significantly lower if the dental practice has a partnership with a local lab.


Cash flow for a dental practice is essential to the business’s success. There are various ways to improve cash flow, and each dental practice must find the best solution for its needs. All that matters is that the practice can bring in enough money to cover expenses and have some left for profit.

Ash Dental CPA provides top-quality dental accounting services. We understand dental practices have specific needs, so we’re here to ensure your financial records are organized. Reach out today via (508) 458-6789 or [email protected] and allow us to help you!