Turning a Profit on Your Dental Hygienist Investment
Editorial by Jim Du Molin
Once again, I’m putting my capitalist hat on and analyzing the economics of dental hygienists. (I started by discussing the economic aspects, and last week I talked about how you can turn a profit.) The dentist needs to begin by preparing an operatory for a hygienist, then actually hiring one. Done properly, the dentist will then start earning a healthy chunk of passive income. At this point, many hygienists may view the dentist as a fat capitalist who is getting rich off the sweat of their labor. They fail to recognize the cost of capital and risk.
As a capitalist, your risk is the cost of equipping the hygiene operatory. If you have to add a staff member in administration to schedule hygiene, that cost would also have to be considered.
In our example, we’ll assume that your cost is a $554-per-month loan payment on equipment for the hygiene operatory. When we subtract this cost from the previous increase in profit, the net return is $5,799 per month, or about ten times your risk. As the number of hygiene days per month increases, your return on investment continues to grow. And that’s what American Capitalism is all about.
Profit on Hygiene Investment
|Number of hygiene days per month||4||8||12|
|Profit on hygiene production*||$1,169||$2,338||$3,506|
|Profit on dentist’s production*||$5,184||$5,184||$5,184|
|Less: capital investment||– $554||– $554||– $554|
|Total Net Profit per Month||$5,799||$6,968||$8,136|
|* before indirect overhead costs|
If you’ve got comments on the economics of hiring hygienists, feel free to post them below!