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Understanding Overhead and What It Means to Your Practice

Course Number: 701


Overhead is one of those factors that ultimately determines the success and profitability of a dental practice. Most practice management literature focuses on increasing and maintaining practice production and annual growth in revenue. However, overhead is well understood by most dentists and dental teams as the expenses that take away from practice profitability. In other words, every dollar spent on expenses is one less dollar that contributes to profit. Of course, every business has overhead and expenses and cannot function without these. Still, there are essential questions that should be asked by every practice regarding what the overhead level should be, how to achieve that target level, what to do if overhead is higher than expected, and how to plan for and track overhead.