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Dental Practice Revenue & Profitability Calculator

Published on December 17, 2024 By Brett Lindenberg

Dental Practice Revenue & Profitability Calculator

Calculate profitability and revenue projections for your dental practice with our comprehensive financial planning tool.

Basic Information

Employee Wages

Overhead Costs

How to use this calculator

This dental practice calculator helps you understand the financial side of running a dental practice. I built this tool using industry research and national averages to provide realistic starting points for many of the default calculations and cited my sources below.

Start by entering the basics into this tool:

Staff and Wages

The calculator's default staffing setup reflects current national salary averages:

Monthly Expenses

The calculator includes research-backed expense defaults:

  • Rent or mortgage payments, utilities, dental supplies
  • Marketing costs (default: $3,500/month, based on FirstDentist's recommendations)
  • Loan payments
outside a dentist office
Outside the dentist office I go to.

What You'll Learn

The calculator will give you the following outputs that can be printed or saved in a CSV file:

  • Monthly and yearly revenue projections (aligned with Statista's reporting of approximately 3,800 patient visits per dentist annually)
  • Complete cost analysis
  • Projected profits
  • Investment recovery timeline
  • Visual expense breakdowns
  • Three scenarios: expected, best case, and conservative estimates

Understanding the calculations

Revenue Calculations:

          
Monthly Patients = (Patients per Chair × Days per Week × 4 weeks) × Number of Chairs
Monthly Revenue = Monthly Patients × Revenue per Patient
Annual Revenue = Monthly Revenue × 12 months
        

Overhead Calculations:

          
Total Monthly Salaries = Sum of all employee monthly salaries
Total Monthly Overhead = Total Monthly Salaries + Sum of all overhead costs
Annual Overhead = Monthly Overhead × 12 months
        

Profit Calculations:

          
Monthly Net Income = Monthly Revenue - Monthly Overhead
Annual Net Income = Monthly Net Income × 12
Profit Margin = (Monthly Net Income ÷ Monthly Revenue) × 100
        

Examining Dental Practice Revenue

While this dental practice calculator helps crunch the numbers, Dr. Chris Salerno, of The Curious Dentist and the Chief Dental Officer at Tend, emphasizes that when it comes to practice profitability: the timing of revenue can matter as much as the amount when it comes to paying your bills on time.

Here are a few nuances the calculator won't tell you about operating a dentist office: insurance reimbursements can take 30-90 days to hit your bank account, while cash patients pay on the spot. This timing differential can make or break a new practice's cash flow even when the raw numbers look solid on paper.

Here are a few nuances to keep in mind based on the Mastering Dental Economics presentation with Chris:

  1. Don't just look at top line revenue. "The famous statistic is that less than 1% of dental practices in the U.S. default on their loan... However, the other side of that is just because a practice isn't failing doesn't mean it's successful," Salerno notes.
  2. Find the Profit Sweet Spot: Salerno breaks down the target overhead ranges by specialty: "Research shows the average overhead for a practice in the U.S. can be as high as 70 or 75 percent... many consultants would say that a good target for general dentists could be closer to maybe sixty percent overhead taking home 40 percent."
  3. Staff Costs: "From a business standpoint, it's the largest part of your overhead is how is your team members and you compensate them that is the number one line item," Salerno states.

The Bottom Line: While the calculator provides a starting framework for financial planning, Salerno's insights remind us that successful dental practices need to balance the raw numbers with real-world timing of cash flows. A practice showing $100,000 monthly revenue might only see $70,000 of that in the first month with insurance reimbursements trickling in over the following months.

Related tools:

Market Demand Calculator for New Business Ideas : Go deeper into projecting market demand for your dental practice with this tool.

Brett Lindenberg

Brett Lindenberg

Brett Lindenberg is the co-founder of BackofNapkin.co. Brett has interviewed hundreds of entrepreneurs, gathering their stories and extracting the insights behind successful startups big and small. His passion lies in making startup calculations accessible so every dreamer has the numbers they need to take the leap. At home, Brett enjoys life’s best calculations: quality time with his wife and two daughters.

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