The DSO Talent War & The Profitability Gap

Announcer:
Hello everyone. Welcome to the Millionaire Dentist Podcast, brought to you by Four Quadrants Advisory. On this podcast, we break down the world of dentistry finances and business practices to help you become the millionaire dentist you deserve to be. Please be advised we do speak with an honest tongue and may not be safe for work.

Casey Hiers:
Hello and welcome. This is Casey Hiers back at the Millionaire Dentist Podcast in studio with co-host Jarrod Bridgeman.

Jarrod Bridgeman:
That's me, Casey. How are you today?

Casey Hiers:
Great.

Jarrod Bridgeman:
I saw you eating a bunch of Chick-fil-A today.

Casey Hiers:
Yeah. There was Chick-fil-A in the office, and I think I consumed more than I ever have in one sitting.

Jarrod Bridgeman:
Yeah. And they say you are what you eat, so you're a chicken.

Casey Hiers:
There you go. Had some mac and cheese too.

Jarrod Bridgeman:
That's right.

Casey Hiers:
I'm not sure. And there was a cookie involved. I mean, I think this was a one-meal day for me today.

Jarrod Bridgeman:
Yeah. That was all your calories for the week.

Casey Hiers:
Day and a half.

Jarrod Bridgeman:
Day and a half. Casey, you were out of action here in the office last week because you were traveling. And so I had Brody Huff and Kevin Roten in here talking their awesome taxes and CPA kind of stuff.

Casey Hiers:
Nerdy stuff.

Jarrod Bridgeman:
Nerdy things.

Casey Hiers:
But really important.

Jarrod Bridgeman:
Yeah. Super important. Well, Casey, I know you and some of your team went to the Yankee Dental Congress there in Boston. Can you kind of tell me a little bit about how this year's event went and how it may have compared to previous years you've gone?

Casey Hiers:
Yeah. Boston at the end of January, I always love that.

Jarrod Bridgeman:
Yeah.

Casey Hiers:
I'll tell you what, some of the Italian food in the North End is amongst the best I've ever had. From a non-dental conversation to a simply food, great city. I'm not a big city guy, the older I get, but Boston's a great city. It's a nice conference. There's a lot of good continuing education that you can receive there. As most listeners and people know, a lot of these trade shows and conventions are unfortunately on a downward trend. There's a lot of headwinds with them. We had a good experience. We had a full house, full room for our two-hour presentation. A lot of questions, a lot of pale faces, because when you start talking about the things that we talk about, it hits people square in the head. And then we had kind of a private event in a nice suburb, Wellesley. Ironically, when you're in a big city, 18 miles can take 75 minutes. So got to see a lot of snow. But regardless, had a nice event there.

Jarrod Bridgeman:
Good.

Casey Hiers:
Little more intimate, one-on-one, real nice people. But again, people are hungry to learn how to be a better business owner. Typically, they're already pretty damn good dentists, but they need to be better business owners. And so we get to talk to a lot of good people about it.

Jarrod Bridgeman:
That's a pretty fun thing too, because you get to go out there, you get to talk to people, and then you also learn from them. You may learn about some issues or problems dentists are facing out there that may be more commonplace today. We often kind of talk about DSOs and corporate dentistry in that way. And I feel that's a hot topic that often comes up when you're speaking.

Casey Hiers:
Yeah, we've added that to our mix, call it the last 15 years. That's been something in dentistry that's been newer, and there's a lot of nuance to it. And so we do help educate people on that from both sides of the aisle. We're not necessarily pro corporate dentistry. That being said, there's a time and a place when it makes sense. We're not anti, but what we are is as a business owner of a dental practice, get your ducks in a row, control your destiny. How can you do that? So yeah. No, we certainly talked about corporate and those things.

Jarrod Bridgeman:
So while you talk about those things, you had mentioned to me that there is a kind of a newer-ish thing you've been seeing with what DSO's been doing with, I would say, is it the hygienist schools? And how does that come into play?

Casey Hiers:
Well, it's interesting. So while we were in Boston a couple weeks back, we were in Northwest Arkansas recently, so polar opposites, right? But we were in an area, I've been joking if I was going to have to be in witness protection for some reason, northwest Arkansas is pretty good. So that Walmart money with expansion, a lot of companies moving into that area. Everything is new and nice, but yet you're still in sort of a rural area in the outskirts.

Fun fact, Ruth's Chris, you familiar with that restaurant?

Jarrod Bridgeman:
Yes.

Casey Hiers:
The largest Ruth's Chris by square footage is in Rogers, Arkansas.

Jarrod Bridgeman:
Really?

Casey Hiers:
Number two, Dubai.

Jarrod Bridgeman:
Oh.

Casey Hiers:
Number three, Indianapolis, Indiana.

Jarrod Bridgeman:
Ours is the third?

Casey Hiers:
Yeah, it used to be the first. So it's interesting. These newer ones, they've got this excitement for being the biggest one. And so the hotel we were at, like seven months new Ruth's Chris. Six months new. I mean, there's an influx of money, but it reminded me Brogan Baxter, our COO, he's always said, if he was a younger person starting a practice, start it in a rural area because so many times these big cities are so saturated, it could be really hard. But you can live in a nice, cool hip area, have your practice maybe out in a more rural area. And this Northwest Arkansas poster child for that, where there's that rural feel, but yet they have infrastructure and a lot of growth going on.

Jarrod Bridgeman:
Well, that makes me think. As you said, a practice in this city, not only is there more saturation in terms of practices out there, but patients can easily move from practice to practice if they wanted to, versus, oh, you're one of the two dentists in this county.

Casey Hiers:
Yeah. Some of these buildings you'll have four dentists in the same building. So if something bad happens, you just go across the hall, where there could be more loyalty. Now there's pros and cons to everything. What you alluded to earlier, having that rural practice maybe in the vicinity of some action, and a nicer cit,y maybe where you want to live or something like that. But sometimes it could be hard to get staff or employees to want to come and work in a rural practice.

And one thing I've been hearing more and more about corporate dentistry and DSOs, they're going to these hygiene schools and these hygiene outfits, and they're getting fresh hygienists signing bonuses to lock and load them up. And so that's even harder for that one or two doctor practice to potentially have that hiring pool, which we already know it's very challenging already. And then we were hearing more and more about that. Sometimes it can take 10 to 15 months to get a hygienist that's worth their salt because they're all getting... Not all. Many of them are getting offered these opportunities and these signing bonuses before ever really stepping foot into a real job.

Jarrod Bridgeman:
I mean, stepping out of school and getting a job right away and getting a bonus and be able to live potentially like in a city, that's obviously very attractive for younger folk.

Casey Hiers:
Yeah. Yeah. So it's just one more challenge, again, that a practice owning dentist or specialist potentially have the face, but there is an argument some of these rural practices are great. And to our listeners that are like, "Well, that'd been fun to have heard eight years ago because I'm in this saturated city." And again, everything has its own unique challenges, but a lot of times, that goes by the wayside; there are some really, really good pockets where you can have a practice that need it more.

And even with what we do, yeah, sure. We go to Phoenix, Houston, and Scottsdale, and unlimited amounts of population and people that come to our events, but that's offered all the time. And we've been picking and choosing some unique suburbs and areas that are underserved, and these people are hungry for our subject matter because they don't get a lot of attention. A lot of times, they have to drive 60 to 90 minutes to a bigger city.

Jarrod Bridgeman:
To anything.

Casey Hiers:
Yeah. Yeah.

Jarrod Bridgeman:
Like me growing up, I lived in such a small town, I had to drive 40 minutes just to go to the movies. That was a true story. And it reminds me of folks out there who are listening and are interested in hearing more about what we do and Casey and the team's presentation. I mean, some of those areas we're going to were going to be in Bozeman, Montana. That's not an area that I think gets all the love in the world sometimes. I'd love to go to Montana.

Casey Hiers:
Gainesville, Florida.

Jarrod Bridgeman:
Gainesville, Florida.

Casey Hiers:
I mean, besides the college, they have a great dental school.

Jarrod Bridgeman:
Everybody sets up shop in Orlando in terms of CE and things like that, or Tampa or Fort Myers and things like that. So it's pretty interesting to find areas where people need the help and want to talk and want to learn more, but they sometimes just don't have that opportunity. Whether it's they're working late, they're up all night working on the books, or they've got children that they have to also balance.

Casey Hiers:
Yeah. And on that point, and a lot of these bigger cities or hotspots, right? The challenge is needing new patients, like actually needing the production. Some of these rural areas, we see practices with incredible amounts of production. Two, three, $4 million in production. They're not lacking patients, but they're lacking systems, processes, methodology, strategy, guidance, and it's incredible how busy they are. And we tell people who are less busy, busy, and not being profitable, right? They're two different things. But yeah, some of the challenges in these rural areas, it's not to be busier for patients. It's in a lot of other areas.

Jarrod Bridgeman:
Right. Because they have to find themselves basically leaving cash on the table, whether that's poor tax management and having giant tax surprises, or abysmal insurance adjustments.

Casey Hiers:
It's interesting. I mean, a lot of the folks we've been helping, again, successful people, great clinicians have achieved success, but they're vulnerable enough to want somebody to do a deep dive. And when we do, again, it's incredible how much money is slipping through the cracks and left on the table. And it takes a team to be able to capture it because it's not just one thing or two things. Sometimes we'll hear, if I could just get one hygienist, if I could just get a better office manager. And unfortunately, that's not the formula. It's a much more complex formula for success.

Jarrod Bridgeman:
Now getting the right one in that role can help, but it's not going to all of a sudden have an influx in your cash flow.

Casey Hiers:
It's not going to lead to another $150,000 of income. And that's kind of the bottom line here. And I mean, that's a specific number, but there's a lot of times it's 150, $200,000 of just straight personal cash flow that you're missing out on because you're doing it your old way, you're relying on a disjointed team, or thinking that just this one or two next thing is going to fix everything. That's not the case.

Jarrod Bridgeman:
And if you're a practice out there that's maybe struggling with production in general, it's not a bad idea to attend one of our events and listen to Casey speak because you're going to learn some things that say, hey, maybe if I start implementing some of these things a little earlier on as I start marketing or getting more patients in here, I'll at least be on a better path.

Casey Hiers:
Well, and I want to make this point too. Almost all of our events are selling out.

Jarrod Bridgeman:
Yes.

Casey Hiers:
And so we're mentioning this as this is an opportunity, seek us out and register, not because necessarily our rooms are empty. We have waiting lists. Again, we want to give people the opportunity to learn about all of the areas other than the clinical.

Jarrod Bridgeman:
And they have the actually the opportunity to ask you questions and be more involved as opposed to classroom.

Casey Hiers:
If people take the time to come to our event, they're going to learn a good amount there, but they're also going to be afforded the opportunity for some one-on-one interaction to get real specific and custom to their situation. You don't come to our events, you might not get that. But I wanted to put that out there because I think it's appropriate we mention our events, but it's kind of like a Hunger Games style on who gets a seat because our subject matter is targeted for practice owners. And typically, practice owners who have, it's not really a production issue, right? They're already producing, collecting north of 8, 900 and there's a lot of those people out there that want to come to these events, but we have limited seating.

Jarrod Bridgeman:
Right. They're hitting the collection numbers. They're doing well. But again, as you-

Casey Hiers:
Where's the money?

Jarrod Bridgeman:
Yeah. Again, yeah, where's my income? I skipped a payment today. I didn't get to do a distribution. And that can be frustrating for people, knowing how much time, effort, work, and all these things that go into having that level and still coming up short.

Casey Hiers:
Yeah. It's interesting. We've been doing this for a while, educating the dental community in a formal manner, for what? The last five to eight years. And timing's everything. There's people who have heard of us, familiar with us, maybe know somebody who works with us, maybe attended an event. And then timing-wise, somebody who maybe heard us three or four years ago, they'll reach out. And I'm like, "Your name sounds familiar." We have some software, right?

Jarrod Bridgeman:
Yeah.

Casey Hiers:
And so able to get in there and kind of go, "Oh yeah, they are familiar with us." And I love that because internally, people have a feeling or an instinct, I need some help in these areas, but there's uncertainty. And so the,n after a while, you're going to wave the white flag or realize for me to be massively successful, I've got to delegate and find a good team. And then somebody will come that we've met three years ago, and it's just like the timing is right.

Jarrod Bridgeman:
It's not just a feeling you're having today. This is a feeling people have had for years.

Casey Hiers:
Yeah. It's typically not knee-jerk. I mean, if you get a six-digit tax surprise, there's typically a little more passion to change course, but a lot of times it's a lot of little things, right? Death by 1,000 cuts. And as a practice owner, that resonates. It's a death by 1,000 cuts. There's a ton of headwinds. How do you get your arms around them? Dentistry's not quite what I thought it was going to be. What can be done? And it's easy a lot of times for a big group of people to go, well, then it just can't be done. And that's incorrect as well, but-

Jarrod Bridgeman:
As we've proven.

Casey Hiers:
Yeah. But we've had some great crowds, and it's always good to have feedback. And I mean, there's people that, "Hey, I drove an hour and a half to be here today and I'm glad I did."

Jarrod Bridgeman:
And it wasn't just for the bourbon. Right?

Casey Hiers:
No. No. We like to have fun when we're together, but when you're talking about taxes and overhead and insurance adjustments and all these things, it's nice to have fun at the beginning.

Jarrod Bridgeman:
I mean, I don't even like talking about my bank account with my family, let alone with a stranger.

Casey Hiers:
Well, in the big room, we're talking about cash flow, but again, they're afforded the opportunity for a much more specific one-on-one where we're going to get real granular. But in the group setting, yeah, it's not appropriate. Now, inevitably, about every other event, somebody wants to get real specific with their situation in that room, and it's, hey, this is probably best discussed one-on-one.

Jarrod Bridgeman:
Let's do this on the phone.

Casey Hiers:
Yeah. Yeah. Some people do want free consulting, and we don't give free consulting, but we absolutely give expertise on subject matter that people are like, "I'm so glad I spent this amount of time learning about this because something's got to change." And we can't help everybody in the room. But if somebody comes to our event, they're at least going to have an awareness of things can't keep going how they're going, that is a great outcome.

Jarrod Bridgeman:
Casey, if someone was interested in joining one of our events or wanted to see where we're going to be next, where do you think is a great place to go?

Casey Hiers:
Aren't you in charge of the website?

Jarrod Bridgeman:
I am in charge. That's right. Fourquadrantsadvisory.com. There is a link that says upcoming events, and we've got quite a few places listed. We got some more places that we've got coming up that we may not have picked our venue yet, but I've got a forum on there where you can be like, "Hey, listen, I want to go. As soon as seats open up, let me know." So fill out a form there. Again, we're going to be in Bozeman. We're going to...

Casey Hiers:
Gainesville, Jacksonville, Asheville, Johnson City, Fair Hope, Alabama.

Jarrod Bridgeman:
Yeah, all kinds of places. Oklahoma and Tulsa. Oklahoma City and Tulsa. Yeah. Let's go. Thank you, Casey.

Announcer:
That's all the time we have today. Thank you to our guests for their insight and for sharing some really great information. And thank you to you, the listener, for tuning in. The Millionaire Dentist Podcast is brought to you by Four Quadrants Advisory. To see if they might be a good fit for you and your practice, go on over to fourquadrantsadvisory.com and see why, year after year, they retain over 95% of their clients. Thank you again for joining us, and we'll see you next time.