When it comes to starting-up and running a dental practice, it is never easy for dentists. As a dentist, you’re trained in managing and providing solutions to oral issues, not business management. For this reason, starting your practice is much like entering uncharted waters – filled with potential risks. One crucial business detail several dental practitioners find themselves struggling with is finance management.
For proper management of your practice’s accounts, you have to know how to streamline your business cash flow. If you don’t know how to do that, you can hire a dental associate accountant in Kansas City to handle your finances. But it’s still advisable to have the basic knowledge of structuring your cash flow. Here are some tips to guide you.
Organize Your Income Structure
At the start of your practice, you probably selected a corporate structure. Whether you’re running a sole proprietorship, a partnership, or an associate practice, always organize your income and expenses structure. Your income structure informs you about the profits coming into practice and your cash flow. Having a grip on the structure helps you structure your cash flow.
Manage Your Debts Properly
The equipment used in dental offices is usually expensive. Unless you have a good stash of money somewhere, you probably got some external financing for your practice. Although dentists don’t like debts, sometimes it’s necessary.
However, you have to be careful not to get into too much debt. Too much debt can affect your cash flow negatively and even run down your business.
Know Your Tax Payments
Your taxes are an essential part of your cash flow structure and your business in general. When taxes are handled correctly, you can save lots of money and improve your cash flow. However, if mistakes are made, you can end up paying a lot more than you should or get in trouble with the IRS. Consulting with an accountant is a trusted way to learn how to know your tax payments. And as a dental practitioner, who you really need is a dental associate consultant in Kansas City.
Control Your Overhead Costs
Don’t let overhead costs overwhelm you. A recipe for failure is letting your overhead level get as high as 90 – 95%. For balanced cash flow and profitable business, your overhead shouldn’t go above 55%. With an experienced dental associate accountant in Kansas City, you can keep your overhead level in the best place possible for your practice.
To put things in perspective, look at it this way: for every 1% overhead reduction in your $500,000 practice, you save about $5,000. Sounds nice, doesn’t it?
Save Costs. Hire a Professional
Consulting with a good accountant can get you and your dental business several significant benefits. An expert dental associate accountant provides detailed information about your business cash flow and tells you what to do to optimize the cash flow. The success or failure of your practice can depend on one small but crucial detail, your cash flow. With these simple ways listed above, organizing your finances and cash flow will be easy and straightforward.