The Next Recession (E.250)

In this solo episode, Dr. Bruce Baird speaks directly to dentists who’ve weathered 2008, survived COVID, and are eyeing the horizon with justified caution. But instead of fear, Bruce calls for action.

This episode reframes how we prepare for recessions not by retreating, but by building something stronger: an investment-grade practice. That means high profitability, low stress, and systems so dialed-in that even chaos can’t shake you.

You’ll learn how to:

• Redefine affordability without slashing prices
• Stop blaming the economy and start optimizing operations
• Use financing tools to create predictable income, even in downturns
• Lead your team with clarity before a crisis forces your hand

“People still need dentistry. It’s our job to make sure they can say yes to it.”

Reflection Questions for the Listener

• Is my practice profitable by design or just by demand?
• Have I built predictable revenue that can survive a slowdown?
• What conversations am I avoiding that could make or break my culture?
  

TRANSCRIPT

[00:00:00] Dr. Bruce Baird: Hi, my name’s Dr. Bruce Baird with the Productive Dentist Podcast. Had a couple more questions this week. Um, this was a good one. Uh, very interesting. It says, “I escaped the 2008 recession, made it through COVID. I’m concerned about the next recession, inflation, et cetera. What can I do?” Well, what I would say is you already have some pretty good experience, uh, since you were able to, you know, get out of the 2008 recession, you survived that. I know a lot of my buddies lost 30, 40, 50% of their life savings and if you were able to get through that and rebuild your, your, uh, retirement plan and rebuild your funds, and you got through COVID where they shut you down and you were still able to survive as a practice, then I think you already have the tools to be able to take the next step when we do inevitably have a recession or inflation. We had inflation over the last year, year and a half. It went up, uh, prices went up, uh, supply costs went up uhm, and, and you know, what I look at is so, so your supply costs go up 10%, you know. 10%, uh, your total supplies are actually 6% of your business. So that 6% goes up, you know, to 7%. You know, that’s actually a 15% increase. Well, how, how do you change that and I, I always look at this stuff, um, how, how do I not be affected by the outside world? And that is by building what we call an Investment Grade Practice. I, that means, and and I honestly believe you probably have one, uh, you know, asking that question. Um, so I’m not gonna say, don’t worry. I would say be prepared and by being prepared, what I mean is building an investment grade practice. That’s part of the coaching that we do at Productive Dentist Academy is to get you to the point to where Profitability’s High. Stress levels are low. Um, systems are in place. You know, the employee handbooks are done, the core values are there.

[00:02:27] Dr. Bruce Baird: Your clinical philosophy is crystal clear. Um, your billing collection systems, your R cm, all of these things are hitting on all cylinders when things happen. Um, what I will tell you is, uh, I hear it way too often, “Oh, you know, with the presidential election, things are tough. It’s really rough out there. Um, Decembers are a rough month for us. July is always tough, you know, inflation is getting us,” you know, the bottom line is people still have teeth, they still have to have their teeth worked on. So what you want to do is build a machine. That runs as systematically as possible so that you’re, you’re at the highest level of productivity, you’re at the highest level of profitability in your business. So when those things happen, uh, in oh eight, you know, I noticed a difference. I noticed that my patients that I was doing veneers on, and some of the implant cases, you know, they just were holding onto their money. They, they weren’t coming in. Um. That’s when I started Compassionate Finance, that’s when we started, built the software, did, did the deal so that I could make it more affordable for, for patients. So in times like that, yeah. What can you do? Yeah. You, you might open up some of your financial options so people can make it more affordable for them, uh, because there’s a difference between price and affordability. Um, most people can afford your dentistry, you just don’t have the options for ’em. Uh, third party financing is gonna accept maybe 40% of the people during tough times but what about the 60%? Well, that’s where products like compassionate finance, accept care, those kind of things can help you, uh, get through the recession. What help a lot of our docs get through COVID, they were still getting 20,000 a month, 25,000 a month on work they did two years ago, three years ago, using compassionate finance. So those are the things that, thinking ahead, you know, the, these are things that you can do. You can begin in, in what I call recession proofing your practice by offering financing options. Um, but having an Investment Grade Business where your team is well trained. And when’s the time to do this now before we have the recession, before we have hyperinflation, before we have stagnation, before we have any of those things.

[00:05:10] Dr. Bruce Baird: But remember, none of that matters to me because people still need dentistry. We still need to find ways for them to get it done and that most often, even people with money. Find ways that they wanna hang onto their cash. ’cause things are tough and they don’t wanna spend it. That’s where e they’ll even do financing options even though they have cash and when I’m, when I’m thinking about, you know, tough times, tough times. I mean, there were people, there were more millionaires made during the Great Depression, uh, than ever. It was time where people began to look at what, you know, businesses, they began to look at how they run their businesses. They began to tweak their overhead. They began to look at how, uh, what are the things that I can do to investment grade my business So that if somebody else looked at that says, “Oh, that’s gonna be a great business to purchase, that’s gonna be a great business to buy, um and, and if you, if you’re in that situation where we get to, which we will, we will, there’ll be another recession, um, just expect it but remember, I, you’ve got teams, you got everybody, uh, the, the same, oh gosh, you know, they all have the same clinical philosophy with you. All the core values are there and these folks, um, you’re gonna continue to work your business. It’s kinda like what I said before about uh, um, you know, I didn’t ever worry about associates going down the street because if they were taking my patients well, then I wanna do whatever they’re doing. You know, that’s when you begin to. I don’t know. I always love taking great care of my patients, but that’s where you take even greater care of your patients. That’s where you really sharpen your verbal skills. That’s where you really sharpen your relationship skills, um, and your communication skills. Crucial conversations, great book, I, I recommend you read it, but crucial conversations are things that I believe as a dentist or as a human being, we need to be able to have. Crucial conversations with people, um, whether it’s that employee that is causing stress for everybody else in the office, uh, you need to have that crucial conversation, but most of us don’t want to have that crucial conversation.

[00:07:45] Dr. Bruce Baird: “Oh, I’ll just let her, I’ll do it later. You know, this person’s not being productive. This person’s not doing that, though,” that’s where you trim the fat. If, if anything is not running at the highest level. Um, with that employee who is just not taking care of patients the way you want, that’s time for that crucial conversation where you go, “Mary, I said, you know, I’m, I’m really concerned, you know, I’ve noticed this, this, and this, and, um, is everything okay?” That’s the way I would approach it. “Yeah. Yeah. Everything’s good. I don’t know what’s going on.” “Oh, okay. Well if you don’t know what’s going on, let me help you. I’m gonna give you as much guidance in this realm as I possibly can, and then at some point we’re gonna have to, we’re gonna have to start hitting on all cylinders, or I’m, I’m gonna have to, you know, ask you to find a happy place, you know, somewhere where you’d be happy. ’cause you just don’t seem happy here.” Um, you, the person who’s not doing the re care, who’s not, you know, that’s always on their phone at the front desk. These are the things you call, um, I hate to say it this way, but, um, if somebody was to pass in your office, would you replace ’em? That’s a tough question, you know, but it’s when you have to ask, would you replace ’em if you wouldn’t replace ’em? Then you don’t need them. If you wouldn’t replace ’em, it’s time to invite them to a new opportunity somewhere else that doesn’t affect you and your team, but recessions. Yeah, things change around there but the one thing I want you to remember more than anything else, as people still have teeth and they still need to get dental work done, that’s where the difference between price and affordability really come into play. Finding convenient monthly payments for people to make payments. I personally would use compassionate finance. I started the company, I don’t, I don’t own it anymore. We sold it but, uh, I would use something like that. I would use third party financing with whatever I could. That’s great but 60% of your patients during a recession are not even gonna be approved for third party financing. So you’re gonna have to come up with some new ideas and some new thoughts. That’s where you can go to, to AcceptCare.

[00:10:09] Dr. Bruce Baird: Look at accept care. With AcceptCare, we actually have five banks, six banks that bid. Uh, on a case, and if you know they approve them, great. If they don’t, it’s automatically switches over to Compassionate Finance, which allows patients to make monthly payments to a third party that isn’t you, it looks like, doesn’t look like you, but it is you, you know? So the payments come in on a, on a monthly basis. I, I never carried somebody paid for 30 months or 60 months because interest is, is our friend during that, during that recession time. So anyway, uh, that is, uh, that’s just another, you know, another way of looking at a recession, another way of looking at inflation, I, uh, what I can tell you, doc, is you made it through the first two, and I’m pretty sure you’re gonna make it through the next one. I wouldn’t spend any heart, muscle or stomach lining worrying about it. What I would do is prepare for it and preparing might be a couple years in advance by offering some financing to patients so that they’re paying you over a period of time. So even if, uh, the revenue went down, you’re actually bringing in other revenue. So those are just thoughts, those are things that, that I did and, uh, that worked very well for a ton of our docs, uh, over a billion dollars in notes were done during that time. So anyway, I look forward to our next time together. Call Productive Dentist. you can go to productivedentist.com, get signed up for one of our courses. Uh, clinical calibration is the new course that we’re offering right now. It’s between 695 and 9 95 a month. That’s for training everybody in your team, uh, on a monthly basis. So, um, get signed up. I look forward to our next time.