Does Your Dental Practice Need Help Managing Its Working Capital?
Running a dental practice can be a profitable venture. In order to find success as a practice owner, you've got to be both a great dentist and a talented business person.
Understanding your working capital is one of the most important parts of operating a successful practice; this includes having an up-to-date dental practice business plan and knowing your balance sheet.
As a dental practitioner, your practice must abide by and live up to the highest industry standards. Your patients demand a quality service led by qualified practitioners within a safe working environment featuring the latest and most advanced dental equipment available.
However, ensuring that your day-to-day operations consistently meet these demands without fail isn’t easy and can be expensive to maintain.
If you are having trouble managing your operating costs, action must be taken sooner rather than later, both for your patients and your practice.
So, in this guide, we'll take a look at some of the signs that your dental practice may need help managing working capital. If you are looking for a dental practice loan, then speak to Rangewell about finding the dental finance solution your business needs.
Why is your working capital so important?
Working capital helps you understand what your practice can safely spend, invest or how much you can take as an income.
It’s a measurement that considers your total current liabilities, such as business tax, utility bills, staff wages, insurance premiums, short-term debt, purchasing inventory, and total current assets, including revenue, prepaid expenses, account receivables and current inventory. Whatever remains is known as your 'working capital.'
Naturally, you’ll want your practice to have positive working capital, but there are a number of factors that can push you into negative territory.
In recent years, dental practitioners have struggled to break even as the coronavirus pandemic took them from busy waiting rooms to emergency services only. Alongside the pandemic, many dental businesses experienced supply chain issues, and other problems brought on by Brexit. During periods of economic turbulence, working capital is one of the first areas of a business to suffer.
If your practice does have negative working capital, it could affect your ability to maintain a successful operation and provide the levels of care your patients expect. Left unresolved and your practice could face becoming insolvent in the near future.
What is working capital finance?
When it comes to growing your dental practice, your mind might turn towards projects such as equipment, improving facilities or refurbishing your dental practice's client-facing areas. But you also need to consider investing in skilled staff, training opportunities, technology and even marketing.
One of the most common funding opportunities for dental practices is working capital finance. This type of funding can allow you to maintain, support, boost cash flow and enhance your day-to-day operations.
Plus, by investing in ever more successful operations, you’ll be satisfying patient expectations. This will, in turn, help you to draw more clients, raising your bottom line.
How working capital finance can provide emergency business support
If there's one thing business owners have learned in the last few years, it's that it always pays to hope for the best but plan for the worst. Yet no matter how well you plan, your practice could still fall victim to an unforeseen emergency, such as flash flooding, vandalism, payment demands or a change in regulations requiring you to make urgent adjustments to your premises.
Of course, for some emergencies, you could file a claim with your insurer. However, it can take up to 90 days for a claim to be processed. That’s three months without the funds you need to get your practice on its feet and provide treatment.
With working capital finance, some products could be agreed upon in as little as 48 hours, with the requested funds following soon after. Therefore, it acts as a buffer that helps prevent an emergency situation from developing into something much worse, allowing you to restore your practice equilibrium in less time than you might think.
Working capital finance with Rangewell
Like any business in the UK, keeping up with the operating costs of running your dental practice can be a frustrating and time-consuming endeavour.
Nevertheless, it’s a vital responsibility that you need to constantly manage. However, your practice could face any number of challenges which may impact your ability to operate and maintain high standards of care.
So as soon as you’re aware of any issues and the root cause of the problem, you need to act fast. That’s where short-term loans like working capital finance could help. Rather than waiting around for your insurer to deal with your request, you could acquire the funds you need to support your practice sooner than you’d expect by applying for finance.
At Rangewell, we have a team of finance advisors independent from lenders. We're not just here to help you find finance, although that is a big part of it. We support you with your business finance application, help you to identify the right kind of business loan to suit your business, and even highlight any risks that may impact what lenders can offer you.
While working capital finance may be an option for you, don't forget that we can also help you to secure a number of different types of business finance, including secured and unsecured loans, merchant cash advances and other sorts of capital loan.
So, if you are concerned about your working capital finance or simply want to learn more about the finance available to your practice going forward, get in touch with Rangewell today.