If you look at your hygiene department, the first thing you need to look at is the data or the answers that are in the data. It is always in the metrics you track.
What I mean by your hygiene department is to dive in and look at two things in your hygiene department.
The first thing you need to look at is…
What is your percentage of the overall production for your practice?
If you are looking at your practice, let’s say it’s a $2 million practice for last year. In 2019 you produced $2 million of production. If you look at that, let’s say your hygiene was $350,000, take that $350,000 divided by the $2 million…roughly 17.5% of your total production was hygiene.
If that’s the case, the industry standards, “where you need to get your practice to” is 25%; 75% of the production comes from the doctors. 25% needs to come from the hygienist.
If you do the math, for example, $350,000 is 17.5%, and you need to get that to 25% of $2 million, which is $500,000, that $150,000 spread is where the hygiene department is not producing enough.
Once you get it up there, it goes straight to the bottom line.
The second thing you need to look at is…
What is your production per hygienist?
Let’s say in that $2 million practice, you have three hygienists. If they are producing $350,000 a year, take that divided by the three hygienists. That is roughly $116,000 of production per hygienist.
Once you look at that, look at what you are paying your hygienist. Let’s say you are paying them $60,000 a year. If you are paying them $60,000 a year, times three, that is $180,000 of staff costs with your hygiene department.
If you take that $180,000 of staff costs and it is producing $350,000, that’s almost 50%. $180,000 is 50% of 360,000, so 50% of the production of your hygiene department is going to staff, directly to the hygienist for what they’re producing.
That is exceptionally high. 50% of the production can’t go to the hygiene department. 33% is where you need to get to. 33% of your hygiene production needs to go to the hygienist.
So, let’s go back to that example. Three hygienists are producing $350,000. If you’re paying them $60,000 a year, they should be generating roughly $180,000 a year, each.
60 x 3 = $180,000 a year of production per hygienist. That is where you need to get to.
That is if you have three. Now maybe you could do the same production with only two, so you have to make that decision. Do you let a hygienist go? Or perhaps you go back and say…
“Hey team, we have to ramp up our production. We have three hygienists. We should be producing over $500,000 a year.”
You’ve got to track those two things.
Typically, the reason for high overhead is the hygiene department. It’s too low and not producing enough of the overall production.
Number two, too much of what the hygiene department is producing is going directly to the hygienist and less to your pockets.
If you’re having problems with profitability, dive into the hygiene department. If you have any questions about it, come see me.
You have to get up to industry standards. Once you get up to industry standards, profitability increases directly.
It goes directly to your take-home pay, and that’s what we are here to help guide you on.
