Cash Flow Assessment

Cash flow is the lifeblood of your dental practice. You may think that your dental skills or friendly atmosphere should mean more than cash flow, but you wouldn’t be able to provide any of that to your patients if you’re out of business!

The Ways Cash Flow Can Impact Your Dental Practice

If you’re looking at the long term of your practice, you’ll notice how cash flow impacts your dental practice in many different ways. A few of these include:

• Technology & Equipment – These days, your patients are expecting the most advanced dental treatment. This includes updated equipment and technology, which, of course, can cost a small fortune! Whether you’re purchasing these items outright, or taking out a loan for them, your cash flow will have an impact on your ability to do so with prudence.
• Outlook – The future of your practice depends on the way you’re currently running day-to-day operations. The impact of cash flow (good or bad) will accumulate, which means it’s important to spend and save wisely.
• Staffing – We’re willing to bet that anytime you’ve decided to hire a new team member, the question of money arose. The number of employees you hire, their health benefits and vacation time, and the training they’ll require will all have a large impact on your cash flow.

At this point, it’s obvious that cash flow has a large impact on the way your practice runs its day-to-day operations. Let’s discuss what exactly cash flow consists of. To put it simply, cash flow is the amount of money that your practice makes, minus the amount of money your practice spends. It’s vital that you know this number, because if it’s too low (or if it’s in the negative) your practice may be in jeopardy.

Wheather you are a start-up dental practice or mature dental practice owner, it’s important that you make sure your cash flow is being properly assessed on a regular basis. A cash flow assessment by CTC National will determine the health of your finances as well as your ability to pay down debts (business and personal).

Additionally, if you’re looking to sell your practice anytime soon, a thorough cash flow assessment needs to be completed. Your potential profitability will be important to potential buyers and the results of the assessment can have an impact on your ability to sell your dental practice; especially if you’re planning to retire.

Make it a habit to regularly check your cash flow, and please contact CTC National to discuss a cash flow assessment. Our dental consultants are able to help with any concerns you may have.