The oversupply of dentists: Why good clinical dentistry is no longer enough!

Dr Phillip Palmer, March 2014 - There is an old adage that nearly all dentists were told soon after graduating, and many dentists still believe: “If you just focus on doing good clinical dentistry then business success will naturally follow.”

If this statement was ever true in the past, it certainly isn’t anymore. And if it was true in the past, it was only true because of favourable market conditions. It was true because there was a shortage of the commodity you had... a dental degree.

To illustrate this point let’s use the current situation with most medical specialists today as a comparison. For the most part, they are all busy; all have long waiting lists and are worked off their feet. Once they have their qualification and status they are well paid and their businesses do well.

• Are their businesses successful because of their clinical skills? The public usually see them as equal in their clinical skills and most doctors would not have the ability to judge and compare the clinical skill of the specialist they refer to.
• Are their businesses successful because of their marketing or communication skills? In many cases they do no advertising and most patients believe that they have poor communication skills, poor reception areas, poor practice systems, and poor customer service.

It is fair to say that many medical specialists are successful in their business due to a shortage of medical specialists in the marketplace, rather than due to the excellence of their service.

Similarly, years ago, it was hard to do too badly as a dentist in this country. As a profession, we were spoilt! There was an undersupply of dentists, the set up costs of practice were relatively low, and there was an increasing need for the work we do (through patient desire for cosmetic work, increasing awareness of the oral systemic connection, increasing awareness of orthodontics, patients keeping their teeth longer through periodontics, implants, etc.) Interestingly, patients have never had any idea whether you are a good dentist clinically or not. Usually, from their perspective all dentists are the same, and all have similar skills. That you are good at dentistry is a given as far as the public is concerned.

The easy times are well and truly behind us and it is well-recognised that there is now a growing oversupply of dentists in this country. The increased dentist to patient ratio will mean that more than ever good dentistry just isn’t enough.

Many people in the industry talk about a looming rise unemployment due to the oversupply of dentists. The truth is that any rise in dentist unemployment will understate the true scope and scale of the problem. It makes dentists that own a practice feel bulletproof in the face of what is to come. The true measure of the oversupply of dentists will be measured in underemployment. That is, not just unemployment but how many dentists with jobs won’t be getting enough hours of work or have the hours of work but will be sitting idle due to lack of patients. The drastic increase in the dentist to population ratio will affect almost every dental practice in the country as more than ever it will force dentists to compete for work and look for ways to stand out from the crowd.

How will dentists compete? How will they choose to stand out from the crowd?

Price: Most pundits believe that an oversupply of any product or service will lead to downward pressure on price. For many dentists this means decreased fees being advertised for most forms of dentistry. If you are doubtful look around. Most full fee dentists are surrounded by cheap, or free (to the patient, ie paid by health insurance) dentistry. This will almost certainly become more pronounced in the years to come.

For those dentists that don’t want to compete on price they will compete via:

1. Clinical treatment range: Dentists should always be learning more clinical skills so that they can offer more treatment options to their patients. But while that may increase the quality of their work and range of work offered, it isn’t what’s going to help them keep or grow their patient base.
2. Value and customer service: If you aren’t going to compete on price then you need to compete on value. Value can be shown in quality of work, or on service or in relationship building. Service is an unusual commodity. Nearly all dentists think they give good service. Most patients think they receive very ordinary service. There is obviously a blind spot here that needs to be illuminated for practices to thrive. Good customer service is something that is only known by comparison with other practices (via comparative surveys) and measurement of attrition rates.
3. Marketing: Marketing is an area where we have been really spoilt as a profession until now. Up until 20-25 years ago you were effectively not allowed to market yourself as a dentist in Australia. You could make an announcement when you opened and that was it. Your signage had to be of a certain size and font. You couldn’t even put your entry in the phone directory in bold font (I was once made to stand before the dental board for trying this and told I would be deregistered if I did it again). Today Dentists in Australia are now free to embrace and explore nearly every form of advertising and marketing available (The only restriction one regularly hears about today is that you can’t use testimonials).Marketing has become a crucial part of doing business as a dentist in Australia and will only become more vital as the oversupply of dentists increases.
4. Good business skills: To be successful financially in any industry, any business must keep overheads within normal ranges. It is not difficult to get the expenses percentages of different categories to normal ranges, but one can never relax. A few years of increases in staff pay, increases in rent, and supplies, and not raising fees will suddenly result in decreasing take home pay of the principal dentist.

Competition, whether in sport or in business, makes us strive for excellence.
Conversely a lack of competition will often lead to the opposite effect – complacency.
There has never been a time less suited to complacency in running a dental practice than now. It is time to strive for excellence in our businesses... if only to survive the coming storm.