Owning and operating a dental lab is an attractive option for dentists, especially if it’s located in an excellent area. During dental school, dentists receive extensive training on laboratory procedures, and their unique perspective makes them an ideal candidates for running a dental lab.
While dental lab profitability varies greatly by location and size, a healthy profit margin should be around 10%. However, for a newly launched lab, it could go as low as 5%.
Cost Of Starting A Full-service Lab
A full-service lab costs approximately $500,000 to set up, and it is not uncommon for this investment to be double that amount. This price does not include the costs of personnel, materials, or computerized tracking systems. The startup cost for a modern dental lab is about half a million dollars, and that’s an underestimate.
Suppose you are thinking of starting your dental lab practice any time soon; here are some tips to help you decide if a dental lab is right for you.
Identify The Most Profitable Procedure
First, you must understand that the most profitable dental laboratory procedures are dentures, upper and lower, relines, and cast partial frames.
As such, you must ensure that you cover these procedures in your practice. Not doing so may reduce your profitability drastically.
In addition to offering a variety of profitable services, a dental lab should be innovative and constantly learning. It should be able to provide the latest technology in its services and should be willing to train its technicians to continue to refine their craft.
Cost of Dental Lab Equipment
It would help if you considered how much you want to spend on dental lab equipment before starting one. There are several types of dental equipment you may need. For example, you may need dental microscopes, model-building equipment, casting machines, waxing equipment, air purifiers, and other equipment. A lab should also be equipped with all necessary utilities, such as air purifiers and filtration systems.
Consider Cost of Staffing
With several pieces of equipment available, you will surely need to hire some lab technicians to help you out. In some instances, you may need to train your staff on a new method. This training may cost you some money too.
So you need to include the cost of hiring these experts in your budget before deciding to launch a dental lab.
It would help if you also considered how much time you’ll need to invest in the lab and your compensation for the time spent.
Size of Lab
The size of your lab is another important factor you need to consider before starting a lab. Make sure you choose a space that meets all regulations. A dental laboratory that’s too small won’t be able to meet the needs of your customers and staff. Also, a large lab will be difficult to organize and maintain. Choosing the right space is also important when it comes to cost. It would help if you also considered how many people you’ll be hiring before choosing a space.
Although dental labs typically work with prescriptions from dentists, you need a pool of potential customers to begin. Choose an area where there are a lot of dental practices. Even if you have only a few clients at first, a dental lab in a busy area will end up having a lot of practices as customers. You’ll also need to advertise and market your dental laboratory to potential customers.
Quality Service is a Must
You need to keep in mind that the dental lab industry is a highly competitive one. With several labs to go to, dentists are not going to put up with low-quality service. They will quickly move on to the next best lab, offering them high-quality results, quick turnaround times and low prices.
In addition to quality service, your dental lab should use genuine materials. The materials should be produced by trusted companies. You should check with the manufacturer to ensure that they are authorized to produce brand-name products. Beware of manufacturers that promise a certain product but fail to deliver. Even if they eventually do, they may be providing you with inferior materials. If they can’t guarantee quality work, you should reconsider your decision to use their material.
Before starting any business, it is important that you do proper due diligence. For instance, you may need to intern in a dental lab for a few months to learn about the process involved and some other insider secrets of the business. Alternatively, you can hire experienced lab technicians to manage things initially while you watch and learn from them.