Trump’s Tariffs: A Threat to Your Dental Practice or a Hidden Opportunity?
Welcome to the Rev Up Dental podcast. In this episode, we're diving into a hot topic, Trump's tariffs and what they actually mean for your dental practice. Are they a threat to your bottom line or an unexpected opportunity in disguise? You'll hear from two industry veterans, Bill Henderson and doctor Bernie Delansky, who break down the real economic impact, what history tells us about dentistry in tough times, and why this might be the best time to buy or grow your practice. If you're a dentist feeling uncertain about what's coming next, this episode is packed with data, strategy, and no nonsense advice you won't want to miss.
Speaker 1:Let's get into it.
Speaker 2:Thank you everyone for joining us this morning, this afternoon, this evening for me. We have people from, all across The US and Canada. Most of this webinar is gonna be geared towards, you know, the impact of Trump's tariffs on Canadian dental practices. But I think even if you're running a practice in The US, you're gonna get some very interesting tidbits and and, knowledge and stats that, definitely apply to your practice as well. Joining us today, we've got, you know, Bill Henderson and doctor Bernie Dolansky.
Speaker 2:I'm sure most of you already know these two gentlemen, but, for those that might be new to our webinars, let me just give a quick introduction to our guests and, you know, why you should listen to them because they've got a between the two of them, you know, decades of experience and, and you're gonna get a lot of value from today's talk. So Bill Henderson is recognized as one of Canada's foremost experts on dental practice valuation and sales. After spending the first twenty five years of his career in the senior executive positions at Fortune 500 companies including P and G and Vesco, Bill bought tier three in 02/2008, with a group of partners after a disappointing experience with the appraisal of his spouse's dental practice. In the following years, he built a brokerage from a small Ontario presence to a leading national brokerage with, you know, operations from coast to coast. And in 02/2021, Bill sold the business to Henry Schein, but he remains on as an adviser to management and he serves a select group of dental clients.
Speaker 2:Thank you, Bill, for joining us. And doctor Bertie Delansky, is a distinguished endodontist and a dental industry leader with over five decades of experience He earned his DBS at the University of Montreal, completed his specialty training at Northwestern University before practicing in Ottawa for thirty seven years as a founding member of Associated Endodontists. He's held top leadership positions in Ottawa, the dental Ottawa Dental Society, Ontario Dental Association, Canadian Dental Association, and the Dentistry Canada Fund, and played a key role in developing the CDA net. A recognized expert in dental economics and practice transition, doctor Zelensky has served as a consultant to major corporations, negotiated on behalf of the profession, and lectured nationally and internationally. He was a former, senior national partner at tier three brokerage, and he now works with senior transition as a senior transition consultant, advising them on sales, valuations, and strategic growth.
Speaker 2:Thank you so much once again joining us and sharing your your thoughts. So it's been chaotic for the last couple months. Ever since Trump is in office, there's tariffs. They're backpedaled, they're, you know, threatened again, and they're backpedaled. And I don't even know where we're at this week, whether it's just tariffs or not tariffs or whether the next one's coming down.
Speaker 2:But it's a very unprecedented time, right now. And I'm curious to you know, this is not the first time the dentistry the dental profession has gone through some, you know, unprecedented times. I'm curious to see, you know, in the past, you know, couple decades when something like this has happened, how has the dentistry profession fared? How has it been impacted by economic uncertainty? Before we answer that, I'm gonna put up a quick poll just to see what our audience thinks, you know, about the current situation, and then we can dive into some stats, you know, about what's actually happened in the past with the demo industry.
Speaker 2:Let me put up a quick poll for everybody. Yeah. So do you, how do you think the certain, current uncertainty and economic risk of economic downturn will impact practice revenues in the coming years? So looks like quite a lot of con you know, somewhat concerned or very concerned investment charity people. One person's optimistic.
Speaker 3:I like that person. It wasn't me. But I am.
Speaker 2:Okay.
Speaker 3:Can you can you show the numbers, or can you just read out what the the rough percentage is? So
Speaker 2:about 56% are somewhat concerned. They think revenues could drop by, you know, one to 5%. A third of people are very concerned that it can drop a lot more than that. And then we've got one person who's, you know, very very bullish on the the growth, and and nobody's neutral. So but most people are concerned.
Speaker 2:Yeah.
Speaker 3:I I like the fact nobody's sitting on the middle of the fence.
Speaker 2:Okay. What do you guys think?
Speaker 3:In the
Speaker 2:past, what what's happened?
Speaker 3:Yeah. That that is a great lead in to the one prepared chart I have. And, you know, the the the the reaction we just got with varying levels of concern from somewhat to very concerned, I would say is what we're hearing a lot of these days. But the key thing for everyone watching to understand is that this would have to be an economic collapse unlike any we've seen in the last forty five years for it to impact your practices in a material way. Nick, if you could put up that graph I sent you.
Speaker 3:What Nick's gonna put up here shows the yeah. Hopefully, that you can see that on your screen, everyone who's tuned in. This looks at the last forty five years of dental revenue growth. The Canadian Institute, for health information publishes, dental expenditures each year. If the bar is but and and then the yellow blocks you see there are the since 1980, every economic slowdown or recession we've been through.
Speaker 3:There was one in 1980. That year, dental revenues grew 16%. There was one in 1982. Dental revenues grew 14%. There was a real slowdown in 9192.
Speaker 3:Dental revenues were up 8%. The first year, 5%. The second year, and so on and so forth. Indeed, across this whole chart for the last forty five years, there are only two years where dental industry revenues declined year over year. The big one, obviously, was 2020 when your offices were all closed for two to four months.
Speaker 3:And, of course, revenue dropped that year. But if you look at the bar beside it for 2021, averagely over those two years, things were growing. The only other decline was in 2010, and it was just 2%. So and that was after, what ended up being called, the Great Recession. Many of you will recall the collapse of financial systems, around the world, significant job layoffs, etcetera.
Speaker 3:So when you look at all of the accumulated history, it shows one thing very clearly. Dentistry is recession proof. Plain and simple. It it's why companies like Dent Dental Corp. And one, two, three, and all their private equity investors are investing so much.
Speaker 3:And indeed, right now, they are getting more aggressive again because dentistry is a wonderful safe haven for investments. So, you know, I understand the concern people are feeling, but, the the data tells a very different story. Now there'd be some exceptions. If you're an orthodontist or somebody who's got a practice heavily skewed to implants, which are more discretionary procedures, these numbers wouldn't be overall representative. But for the average GP out there, this is what the industry has done cumulatively.
Speaker 3:So, Bernie, what do you have to say about that? You you have lived a bit more of this than I have.
Speaker 4:I've lived it. And like my colleagues, most dentists, whenever there's an economic downturn and scare scary headlines, doom and gloom, like, I I was not in as informed then. Maybe I got a little older. Maybe I got a little wiser. I doubt if I got any smarter, but I am better informed.
Speaker 4:And we you said that we're recession proof. We're almost pandemic proof. Yet you literally have to close dental offices for revenues to drop. It's phenomenal. The only thing I would add on the negative side is the effects of Trump's tariffs will probably be somewhat geographic.
Speaker 4:If you're in a auto town, car producing town, steel producing town, that those overall statistics won't help you if people are laid off. That is an effect that will definitely influence dental practice revenues. But overall, I expect that history will repeat itself, and that graph that you show will when we look back at 2025, it'll show some growth.
Speaker 2:Now, you know, the economic like, the reality of, how much of an impact it has versus how much people think it will have. I mean, people are emotional. They'll make emotional decisions. Right? So with all this economic chaos, the the the threat of tariff, has that had an impact on practice sales, practice valuations?
Speaker 4:The economic uncertainty absolutely has. But we have to look at some bedrock things.
Speaker 2:Well, Bernie, sorry to to interrupt. Let I'm I'm curious to publish a poll here to see what people think before you give them your opinion.
Speaker 4:I I'd love
Speaker 2:to That way they can backpedal.
Speaker 4:Before before I share what I It's
Speaker 2:a curiosity here, you know, over the next one to three years yeah. Before you give them the answer, I'm curious to see what people have to say, whether it's gonna have an impact or not.
Speaker 4:Well, the answer will be my experience and Bill's experience, and that's pretty good when it comes to selling practices. It's what we do. Or try Yeah.
Speaker 2:Out of hundreds and hundreds of practice solder.
Speaker 3:Yeah. The, yeah. We're doing as a company, we're doing over between 80 to a 100 a year. And, Bernie Bernie Bernie was one of the very early partners who helped grow the business. You joined in, what, about twenty ten, eleven, Bernie?
Speaker 3:I recall correctly. So, we've we've seen ups and downs, and we've seen thousands of practice sales.
Speaker 4:Yeah. Well, actually
Speaker 2:Yeah. So
Speaker 4:Go ahead, Nick.
Speaker 2:Looks like most people are concerned. So about 50% say, yeah. Possibly, but it depends on the policy changes specifically, which is true. I mean, it's like we're getting tariffs. We're not getting tariffs.
Speaker 2:It can it seems to flip flop every other day. About a third, say, yep. That will definitely drop. A small percentage think, no. The market's still strong, and then some are just not sure.
Speaker 2:But I guess the vast majority do think that there's gonna be a small to a significant drop.
Speaker 4:K. Well, in this case, the majority has some reason to think that. It's very paradoxical. I personally, as a practice broker, have never been more busy than I am right now. I'm dealing with six, seven, eight sales, which is an unusual amount at one time.
Speaker 4:We like to say that it is a lumpy business, but that's that's a very nice big lump. And, so practices are selling. But what's happening is there's a split in the market, schizophrenic market, if you wish. The first time buyers are very, very much infected by this uncertainty. First time buyers by nature are very hesitant and prudent with good reason.
Speaker 4:Nick, can you take that down from the screen? The poll.
Speaker 2:The poll will go down if you vote.
Speaker 3:Yeah. You've got to vote for the public number. It's not showing up for any of the rest of us.
Speaker 4:Yeah. Anyway, the so the first time buyers are very hesitant. But the bedrock or one of the bedrocks of buying and selling a practice, of course, is supply and demand. That hasn't changed much. We still have more buyers and sellers.
Speaker 4:The other bedrock is financing for sales, the banks. And the banks have not changed. They are still funding these sales in a manner unlike any other business that's funded, 100%, prime minus a quarter, one to two years of interest relief, etcetera, etcetera. That has not changed. And the third bedrock of the, market, which for the past years has been the DSOs, the corporate buyers, both large and small, The big ones who own hundreds of practices and the many smaller ones who own, let's say, between five and fifty practices.
Speaker 4:They are still buying, and they are not hesitant at all. So it is really affecting a certain segment of the market. The smaller practices, let's say, under $2,000,000 valuation, who are being bought by first and second time buyers. That's the part of the market where there is now a buying opportunity because those prices the valuations haven't dropped because they're based on all the other factors I just told you. But the offers we're getting are somewhat lower than valuation for that small segment of the market.
Speaker 4:Well, it's not small. It's a a large segment of the market. So in a nutshell, yes. The people who think that practice values have gone down becomes of this have some justification for that, but it's more selling prices that have gone down. And if you're a buyer, now is a wonderful time to buy.
Speaker 4:What would you add to that, Bill?
Speaker 3:Well, yeah. Yeah. That's the key message. If you're listening to this and you're a buyer, oh my god. The the this is, the best window of opportunity you're gonna have.
Speaker 3:Because go back to that chart I showed you. Practices are gonna do just fine no matter what happens in the economy. But we've only got forty five years of history to show that. And, you'll have less competition now than you would have in many cases. The only other thing I'd add, Bernie, and we've talked about this, is there is also a strong element of regional differences in this regard.
Speaker 3:Now right across the country, it doesn't matter if it's in Eastern Ontario, the GTA, or out West, there absolutely has been a flight to quality. And we've seen this every time the market's had trouble. You know, we saw when interest rates spiked up 7%. Great practices were pretty much still selling at the price they would have before, but people got a lot, a lot more focused on any practices with shortcomings. And let's face it.
Speaker 3:Eight out of 10 practices have at least one shortcoming. So there's been a flight to quality, I think, to some degree, but the regional differences are significant. We recently my partner, doctor Patty Ann Jones, and I had a practice for sale in a very high demand area, sort of Oakville Burlington area in the GTA. And we received well, we had 40 people come out to the showings, and we received 20 offers, or more. I think it might have been slightly more than 20 offers, and that practice will sell for, meaningfully above the appraised value.
Speaker 3:It is regrettably kind of the exception that proves the rule. But, you know, the I think if you're a buyer, you're you know, this is the sweet spot. Move quick before people figure this out. If you're an owner, what it does say is it's really important to sit down with somebody and talk about, the strengths of your practice and the opportunities in your practice. And I don't think that's going to change.
Speaker 3:This is becoming more and more of a business all the time. And understanding your business metrics, how they compare, and what levers you can pull, is gonna become, is now far more important than it has been and will be even more so going forward.
Speaker 2:Yeah. Now out of curiosity, is CDCP playing a role to offset these concerns?
Speaker 4:Yes. Look. Anytime you have billions of dollars injected into any segment of the economy, it's gonna make a difference. I I mentioned earlier, there are certain areas that are going to be affected by layoffs, etcetera. CDCP will definitely pick up that slack.
Speaker 4:We are starting to see it in those practices that are accepting it. Quite frankly, most of the practices I'm dealing with are accepting it on a more limited basis. But I talk to a lot of people about CDCP, and more and more people are accepting it. Certainly, for the larger DSOs where they need a constant stream of new patients, it has been a boon. But as we keep repeating, those of you who listened into our previous CDCP presentations, it's all about the balance billing.
Speaker 4:It's only going to help your practice value if you balance bill. If you are willing to take on average a 15% haircut, you are in effect taking a 50% haircut because most practices, after everybody's paid, the dentist, are looking at 20 to 30% left on the bottom line. And if you take 15% away from that, you are taking away a huge chunk of your bottom line, and your practice value is dependent almost totally on a multiple of that bottom line. So at a six multiple, for every dollar you're losing, you're losing $6. $10,000 becomes $60,000 loss in value.
Speaker 4:We cannot emphasize strongly enough the negative effect of not balanced billing that that negative effect will have on your practice value. But to answer your question, Nick, absolutely, it's helping. And my prediction is it's really going to help a lot in those areas most heavily affected by the tariffs.
Speaker 1:Quick break before we dive back in. If you're serious about growing your practice, make sure to check out the free guides we've put together over at revupdental.com. Whether you're hiring front desk staff, planning your 2025 social media strategy, or training your team to ask better questions that convert calls into appointments, we've got step by step playbooks to help. Again, that's revupdental.com. They're completely free and packed with actionable tips you can use today.
Speaker 3:And the the other thing I'd add well, two things I'd add. Right? First, reinforcing Bernie's point about balance billing. When I said there's a flight to quality, if you are not balance billing, you are going to have a very hard time selling your practice. It's the first question out of virtually every buyer's mouth these days.
Speaker 3:Nobody wants to buy a practice that's locked into being dependent only on government funding. So just underscoring Bernie's point in that regard. The other thing is for those of you most of you on this call will have seen some limited impact in your practices. The key thing to remember is that, so far, it's only been about forty percent of the population that will that is now eligible this month and as we trickle into next the next couple of weeks. And only half of them have sought or received treatment.
Speaker 3:So when you look at the numbers relative to the full population that will be eligible for CDCP, only one fifth that sought treatment. The that 18 critical eighteen to sixty five group is, eligible now. I think the youngest group within that, can't apply for another week. But and while I don't think everyone who's eligible will seek treatment in any given year, what you've seen so far is my guess is just a third of what will be coming at you in the coming year. And, honestly, I think that will not only, as Bernie was saying, offset potential losses, in practices that are in towns hit more heavily by the economy, it's gonna boost all the rest.
Speaker 3:So it's, you know, it's the other reason why set aside CDCP, there's no historical data that says you need to worry in a standard practice about more than a 2% decline. And on top of that, we're dumping 4 and a half billion dollars into 22 dip billion dollar industry. Again, purchasers out of there, oh my goodness. You're not gonna have this opportunity again.
Speaker 2:Now is, you know, are the tariffs having a bigger impact on supplies, equipment? Is is that what's gonna take a, you know, huge increase? Like, what what's the impact there on the on the supply side?
Speaker 3:Want me to jump on that first?
Speaker 4:Yeah. You have the latest information.
Speaker 3:The the one of the benefits of Bernie and I selling the business to Henry Schein is we we've got the ability to really understand what's going on in that area, Nick. And I would say there's there's sort of two very different categories of impact. The first is tariffs that are be being placed on goods coming from The US into Canada. And there was a fair level of concern in the industry right out of the gate because a number of things were going to be subject to tariffs that had been announced. That say, you know, the what was it?
Speaker 3:It was toothpaste. It was fluoride treatment and varnishes, anything metal based as soon as we got into the tariffs on steel and aluminum. So things as simple as the the clamps for a rubber dam or wires for braces. But that was rescinded almost immediately by the Canadian government for any health care related products, and that's been pretty all encompassing across dentistry other than whitening. So the impact of tariffs on coming into Canada is negligible.
Speaker 3:The longer term issue that we have not seen yet is the increased costs being borne by US based manufacturers if any of them their materials are, subject to tariffs. So if you're making dental chairs in The US and you've been using Canadian steel, or Chinese steel, your costs are going up. If you're a big distributor, but like Henry Schein, you have been buying and bulk bringing it into The US and redistributing across North America. Those if those products are being sourced from countries that are now being tariffed going into The US, that's gonna get passed along as it ships into Canada. So there's real efforts going on right now to completely reconfigure supply chains to run around The US.
Speaker 3:None of us knows what's gonna happen in terms of the the tariffs going into The US other than it's gonna be highly variable. Bernie was saying that, you you can chime in a second and say what you heard this morning. But that the, so far, very little. I think we'll start to see some cost increases on some things over the summer is what I'm hearing. But the two key things to remember are, a, your provincial associations have been excellent at making sure the suggested fee guides recover any real cost increases people have seen.
Speaker 3:They did a brilliant job of that through the very significant changes during COVID. And b, supplies just aren't that big a cost of running the dental practice. The average practice out there, you should have supply costs at 7% of your revenue. And so if tariffs impact some of the stuff you're buying, it's gonna be, like, even a a 10% if it impacts 10% of the stuff you're buying, that's probably all it's gonna do, and it won't be you know, if it's 25% on 10% of what you're buying, it's negligible in terms of the real impact on your business.
Speaker 4:I'd like to address the question in a little broader sense, Nick. I hear a lot of rumblings from my colleagues, from dentists, about the cost of supplies and that distribution companies like Patterson, Shine, Sinclair in Canada, Price Gouch. You know, these guys are making a fortune. Part of my very checkered background is I was actually an officer and shareholder of one of those companies. For the older people on the call, Ash Temple, which was bought by Henry Schein when they moved into Canada.
Speaker 4:That's how they moved into Canada. And, I can tell you that like any distribution retail distribution business, whether it be a grocery chain or a dental supply chain, those margins net net margins are very small. It's all about volume. That's how you make your money. And the only way you get to volume is if you are price competitive.
Speaker 4:It's a very competitive business. You have the big three I mentioned in Canada, and you have a bunch of smaller ones who are constantly price cutting. If you want a number, when I was with Ashtemple, if at the end
Speaker 2:of the
Speaker 4:year for literally hundreds of millions of dollars of investment, if we made five, six, 7% at the end of the year before tax, that was a good year. This myth that's out there in the profession that supplies are way overpriced and that these companies are gouging and making a fortune is just that. It's a myth.
Speaker 2:Now from what I understand, the equipment sales is actually up right now, isn't it?
Speaker 4:Yeah. Bill and I were at a presentation, and we heard that. And everybody looked at each other. What? You know, there's uncertainty
Speaker 2:Are they all trying to, like, buy up before they think this crazy terrorism being put in place? Or what's what's is there fear?
Speaker 4:Bill has a take on it. My take is that the people who tend to buy equipment, there are two. There's those who are starting practices, and you have no choice. You have to buy equipment. The discretionary sales are usually in older practices that want to upgrade and keep current, etcetera, etcetera.
Speaker 4:And those usually are the more successful practices. These are people who have built great practices, wanna keep them up to date, and know he maybe instinctively, they haven't seen Bill's graph, but they know instinctively that this is a good industry and that their patient base and their revenues are pretty solid. And, they're they're doing what they would usually do, buying equipment. That's my take.
Speaker 3:Yeah. Yeah. I think that that that's exactly right. The I Nick, I do think that there have been some people worried that cost may go up significantly and therefore buying now when they might have
Speaker 2:They're stocking up.
Speaker 3:Yeah. You know, the the reality is there's not a lot of reason to believe costs will go up significantly, as I was saying earlier. But I think it also speaks to just how fundamentally and I know when I say this, there are gonna be people out there go, Henderson, you're you don't know my business, so you're you're way too optimistic. The industry is in great shape right now, notwithstanding the long term threat from CDCP, which we've talked about in in the past a lot. Practice revenues broadly across the country are up, and the CDC is gonna feel fuel more growth so long as your balance billing.
Speaker 3:And so I I think one of the drivers of equipment sales is the industry is doing very well, which is invariably going to mean people need more equipment. You know, 9,000,000 Canadians will qualify for the CDCP. And if a bunch of them have not been going to the dentist and now start, people need more chair time. And sometimes that means they need a new op. Plus, I think the other factor is there's definitely a trend towards investing in technology, which is necessary given, the impact of staff shortages.
Speaker 3:Technology is a way of addressing staff shortages to some degree in some areas. And, you know, I I think that has also driven some of it.
Speaker 4:Yeah. And going back to my Ash Temple days, dentists are very slow adapters of new technology. So even what are considered no brainer technologies now like digital X rays, it took ten to fifteen years to roll that out.
Speaker 3:Yeah.
Speaker 4:And the big one now are digital scanners, and we're just in the middle of that rollout. And more and more offices are now realizing that the scientific term is the goop impression is really not what patients expect. And you're seeing a lot more digitization, especially on the scanner side.
Speaker 2:Yeah. It was interesting. And one of my wife had the you know, you go to different practices to for a procedure, and some of them are very modern, you know, like, high-tech, and some of them, they give you the goop. And it's gonna be, pretty jarring, yeah, when you when you switch from one to the other. But we've got another three, three and a half years of Trump.
Speaker 2:Alright? So how do you both feel things are gonna play out over the next two, three years? Because I guess there's two perspectives here. There's there's the younger dentists who are finishing school. They're looking to open up their first practice.
Speaker 2:What what does their next three years look like? We've also got the dentists who are currently running the practice. They're, you know, kind of halfway through their career. But we also got like, plenty of our clients, you know, they're looking to sell their practice in a couple years. They usually come to us because they wanna grow it.
Speaker 2:They wanna, you know, drive more patient flow. So the objective being, you know, two, three years they wanna get out. So what are their three years look like?
Speaker 4:I'll go first if you want, Will. Yeah. As I said before, the ultimate determination of your practice value is supply and demand. As long if you live in a area of the country where the supply of dental practice for sale is smaller than the demand, more buyers than sellers, that would be most parts of Southern Ontario, Southern BC, to a certain extent, Alberta, less so in almost every other province. Your practice values, my cloudy crystal ball says, over the next two to three years, your practice values are gonna stay pretty good.
Speaker 4:The other great determinant, of course, are interest rates. And I think with all the economic uncertainty over the next few years, I don't know. Bill's more versed in the economic side of things than I am, but I think that's going to slow the cutting of interest rates. And, anytime you have an uncertainty, the central bankers tend to, as they should, on the side of caution. So interest rates will probably stay where they are, which are giving us five and a half to six and a half multiples for the individual buyer, slightly higher ones for the corporate buyers.
Speaker 4:So I think you're pretty good over the next two to three years. If you've got a smaller practice and you're gonna be selling to a individual buyer, I'll stand by what I said earlier. Economic uncertainty, next two to three years, they are gonna be more cautious. And getting full asking price on those practices, I think, over the next two to three years with uncertainty is gonna be uncertain.
Speaker 3:Yeah. I don't disagree with anything you've said, Bernie. The, I the thing I keep focusing on, none of us can predict what's coming. They if there's one thing we've learned over the last four or five months, none of us knows. And if you don't like what happening yesterday, turn on the TV today.
Speaker 3:And the but the one thing that the administration to The US is definitively not gonna do is remove all the teeth from mouths of Canadians. Your patients all still have their teeth. They all still need proper hygiene care. They all still need dental care. And, you know, the graph we've led with at the front ends shows that they will continue to pay for dentistry no matter what happens to the economy.
Speaker 3:Plus on top of that, a lot of people who have not been able to get care, now will be able to get care. People who can get all the care they needed will be able to get more care. So I I remain very optimistic about, the the next three to five years. The forty five years of history has shown us the economy is not going to take a significant toll on dental practices. Now there is one big cloud on the horizon that I I wouldn't wanna leave this without.
Speaker 3:Bernie's already talked about, and I've mentioned that. I'm not worried about the economy. I I'm not worried about tariffs. I think it's a wonderful opportunity for buyers right now. I think that will dissipate as everyone gets more used to the shell shock we experience daily.
Speaker 3:The DSOs are, in my opinion, getting more aggressive now. But the the the one big question mark is, whether dentists are gonna balance bill in the CBCP. And let let me be as blunt as I can be. If you are not doing that, you are hurting your practice, your personal net worth, and risking the profession. And we know that the politicians did not want you to have the opportunity to balance bill.
Speaker 3:The provincial and national associations did a fabulous job in my opinion, and I've not always been their biggest fan, but on this, I really have been, of getting you that right to balance bill. But if, if enough people out there do not do that, you give the politicians all the ammunition they need to take that right away. And I so I think it's really important you continue to support your, provincial association, the national association. The risks of the insurance are real. The risks of losing balance billing, I think, are real.
Speaker 3:I don't know how significant. That is the only thing I'm concerned about going forward. And I I I suspect, Bernie, you're gonna disagree with me vehemently.
Speaker 4:Not on anything you said. I'm actually gonna add to what you said. You've done a very good job of emphasizing the most important thing. The second cloud on the horizon is the insurance, And that is something the profession has absolutely no control about. What the insurance is is companies and unions saying, well, if the majority of my members or employees are gonna be covered by CDCP, why do I need to pay my 50% of a dental plan?
Speaker 4:Use the CDCP. And that to me is another very large risk. Really, the foundation of the Canada is constantly, constantly ranked amongst the best countries in the world for oral health care, and the foundation of that are the seventy to seventy five percent of our population who are covered by private dental insurance, has been for decades. And that is at risk. And, unfortunately, there's nothing the profession can do about it.
Speaker 4:It's one of those unintended consequences that the politicians never think about when they establish a plan like CDCP.
Speaker 2:Just to share some stats on our end because we, work with hundreds of different practices across US and Canada. We monitor how many calls they get, how many patients they're signing up, what they're spending for, you know, to to get someone on the phone. There hasn't been a significant change. So if we look at look at my stats here, in November 2024, on average, it cost about a $103.39 in marketing investment. And this is we're talking we spend millions a year of, like, dentists money to try to get them phone calls.
Speaker 2:So it's a lot of data. It was costing about a $103 to get a new patient on the phone. Then if we look at 2025 so in January because when did Trump when did he enter off? January 20. January.
Speaker 2:Okay. Yeah. So in '25, it went down to a $101 to get somebody on the phone. And now in April, it's about a 109. I guess maybe went up a little bit, but you it's within the realm of, like, a deviation.
Speaker 2:Right? So Mhmm. Not much has changed. And even if you look at okay. That now that's a phone call.
Speaker 2:It doesn't mean that the patient sign up. Right? But if we're looking at sign ups, there hasn't been a big change in that either. It cost in 2024 so November 2024 was costing about $257 average for them to to get one new patient. And when you think about, you know, what the average patient will spend in dental office in even just, the first year, it's it's phenomenal return on investment.
Speaker 2:And, you know, that's average. Some of them get, you know, acquire patients for significantly lower than that. But now in '20 in April 2025, it's still $2.61. So if we look at our data, I mean, it's just as easy to attract patients as it was before he joined office until after. It costs just about as much to get a patient.
Speaker 2:So I things are looking good on on my end in terms of, you know, trying to drive patient flow. It it's it hasn't gone up and hasn't gotten more expensive. And then when you factor in inflation and things like that, I would argue that's actually getting cheaper to get a new patient. Right? But we saw this during COVID too when there was, like, a big scare.
Speaker 2:A lot of people started, like, you know, turning things off, stopping their marketing, and it actually turned out during COVID it was one of the cheapest times to get patients because you'd have basically no competition. Like, you're not competing against anyone. Everyone stops spending money. And so if you're one of one of the ones that, you know, stayed calm and carried on, you'd have grown significantly. Right?
Speaker 2:So I think that, when when people get into a panic and they start, you know, stopping progress, it's like, let's sit back. Let's see how do things play out. I think it's a detriment. I think that, you know, you should just push forward. The the industry is pretty resilient.
Speaker 2:From our data, acquiring patients is just as easy as it was before Trump was in office. So I think the biggest risk is if you go into a bit of a panic and start just changing a formula that frankly works pretty well worked very well for the last fifty fifty years.
Speaker 4:Mhmm. Yeah. Exactly. I'm trying to remember that novel. Oh, A Tale of Two Cities that I studied in high school.
Speaker 4:I doubt if it's still being studied. But the opening line is and the closing line are, it was the best of times. It was the worst of times. I think it's the best of times for dental practices. It's the worst of times for certainty in the economy.
Speaker 4:And I every dentist should thank their lucky stars that they are in a profession where they are so resilient and so resistant to economic uncertainty.
Speaker 2:Yeah. It's a profession that creates a lot of value for, you know, a very large customer base. So, you know, no matter what's going on in the economy, your teeth hurts, you're going to the dentist. So that that's not gonna change anytime soon.
Speaker 3:But, Questions next, or can we encourage people to plug a question in there? I I'm way more interested in answering questions than, here in Boerne talk.
Speaker 2:Yeah. Absolutely. So if anyone has any questions, if, you know, for for our guests here, we'll, keep things open for a few more minutes, just to address them. And if not, then it's a short and sweet one. You know?
Speaker 2:Keep calm, carry on, and, you know, things are going well.
Speaker 3:Yeah. Far less going on in the chat than when we're talking about CDCP, I've noticed.
Speaker 2:Yeah. It's not as heated as the topic. CDCP definitely brings in a lot of opinions. Yeah.
Speaker 4:Yeah. Okay.
Speaker 2:Now it looks like we don't either everyone agrees or they're sleeping at their computer.
Speaker 4:Well, it's interesting. You say that everyone agrees. The polling showed that everybody had some, some concerns, some real concerns. And we've basically taken the other tack that you
Speaker 2:can
Speaker 4:have your concerns, but history and what we're seeing is that things are are pretty good.
Speaker 3:Yeah. I I I think it's as simple as human nature as if we're generally concerned about what's going on. We're gonna have a heightened level of concern for everything. And I don't think anyone on this call is suggesting there aren't some very significant and important things to be concerned about these days. But, fortunately, for the vast majority of people on this call or listen to the recording, your dental practice need not be one of those things.
Speaker 2:Fantastic. Well, thank you again both for, taking the time to share your knowledge and hopefully calm down the profession. You know, we'll, so thank you everyone for joining us. You know, you'll get the recording at the end of this. We'll send out a poll as well for other topics that you guys might be interested in that, that that we can host.
Speaker 2:But thanks again, Bill and Bernie, and thank you everyone for joining, and we hope to see you on the next one.
Speaker 1:Thanks for tuning in to this episode of the Rev Up Dental podcast. If you want to learn more about how to attract high quality new patients and grow your practice, especially in uncertain times, head over to revupdental.com. We've got a library of free resources waiting for you, including e books, videos, articles, and more, all designed to help you build a stronger, more profitable dental practice.
