Business Advisors on Business
Strategies to consider now and in the future
Our rapidly evolving business environment demands that laboratory owners recognize the changes taking place in the dental industry and respond by implementing strategies that ensure the relevance, success, and ability of their businesses to thrive in the face of these changes.
IDT asked our team of astute business strategists to provide insight and advice on the critical trends they believe are and will be impacting the laboratory industry, changes in the business environment they see forthcoming, and on strategies to help businesses prepare for the future.
Critical Business Trends to Watch in 2017 and 2018
"Advances in CAD/CAM technology impacting the removable side of the business is a trend to watch closely. As the ability to mill partial and ultimately full dentures becomes a reality, that will open the door for streamlined production, faster turn times, and cost reductions. The introduction of new materials such as PEEK and other polymers will also come into play, which will offer laboratories that may currently have limited removable options to expand their offerings and provide the opportunity to attract and retain new customers."
Adapting to a Changing Business Environment
"For laboratory owners who have traditionally prided themselves on being 'hands on,' it will be critical to spend more time managing the business. That includes ensuring a stable, well-trained workforce; understanding new technological developments; keeping a close eye on costs and margins; leveraging relationships with customers to maintain customer satisfaction; and maintaining a long-term strategic plan for the business."
"Perhaps the most important business trend to watch is the strategy of 'additive' versus 'subtractive' manufacturing. Both methods have their benefits and limitations, but they both provide a logical way to overcome technician availability issues and to increase production."
"The business environment is changing as the dental industry re-forms to a more corporate structure. Laboratories need to be considering their supply chain and how to reduce cost and inefficiencies. It will be critically important for the laboratory owners to keep up and solidify their relationships with existing clients."
"We already see the vast consolidation of the laboratory business and also of dental practices. Dental management organizations (DMOs) are investing money and talent to acquire, consolidate, and manage their newly acquired laboratories and clinics, able to standardize the process and negotiate very favorable terms on technology. Without a doubt, this will have a similar impact on dental laboratories as well."
"Among the simultaneous trends impacting this industry, the fast pace by which the market is successfully targeting the solo general dentist practitioner to acquire CAD/CAM impression and milling technology is one to pay close attention to."
"Looking to the year ahead, dental laboratories should invest in the latest marketing software technology to help streamline the sales process, reduce labor costs, and increase one-on-one communication. Improving the way we interact and connect with each prospect throughout the sales process is critical for getting results."
"Employee recruitment and retention challenges will continue to be a critical issue for businesses this year and beyond. The competition for talent will continue to grow. A new generation is entering the workforce, and businesses will have to continue to implement strategies to manage the needs and expectations of all these generations. Employees will expect more from their employers in providing resources for employee health and wellness."
Business Advice for the Future
"Know your customers' needs, know your employees' needs, and be flexible and willing to try different ways of doing things. Stay abreast of the laws and regulations that affect your business."
"Businesses of all kinds change constantly. Without change and modernization, you are left behind and can't compete with the aggressive and innovative competitors. Those laboratories that are moving ahead use expert financial, tax, and other business advisors to beat their competitors to the customer."
"From a human resources perspective, laboratory owners need to be mindful of the continuing changes to the healthcare landscape. While the Affordable Care Act is still in effect now, upcoming changes through legislation may impact your overall medical benefit costs. As you may be aware, the rising cost of healthcare continues to be a significant portion of the overall benefit expenses."
"Train your people. Senior technicians are leaving the workforce, and the subtle skills or 'tribal knowledge' are not being passed to the next generation on a formal basis due to lack of rigorous training programs."
"Laboratory owners need to be sure that the processes and people they have in place match where the industry is headed. Moving forward, IT and CNC operators/machinists are going to be key employees. Neither of these positions existed in the dental laboratory 10 years ago, but in the future will become the laboratory's most important employees. Additionally, employee retention will be even more important as there is clearly a shortage of dental technicians due to retirement and other factors."