The Dentist's Network #63


	Dental Inventors Word Of Mouth By Google Real Estate Deductions

Louis Malcmacher
DDS MAGD
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Are You A Dental Inventor?

Common Sense Dentistry

I was recently privileged to present a few courses at one of the best meetings of the year: The Greater New York Dental Meeting. I was part of a panel discussion on controversies in dentistry with Drs. Gordon Christensen, Marty Zase and Gerard Kugel. It was really a unique and interesting format—each of us presented for a short period of time, after which the crowd of a couple of hundred of dentists were able to ask questions of the panel that we would discuss, agree on, and (many times) disagree on.

In every crowd, there are one or two dentists that come up and want to talk about an idea or an invention they have to make the practice of dentistry faster, easier and better. The big question that most of these dentist inventors have is, “What do I do now?” Once you have an idea to share with other practicing dentists around the world, how do you take this idea (which is on paper or maybe even has a patent) and get it to the dental market? Anyone who has ever attempted to go to market with a product knows that is can be costly, with many pitfalls along the way.

Let me introduce you to Dentcubator. This new dental business incubator company was rolled out at the Greater New York Dental Meeting and has made an instant impact. There are approximately 5,000 business incubator companies globally. This is the first known dental business incubator company. Let me explain to you what a business incubator company does. After a due diligence and get-to-know-you process, a business incubator company can develop your product, apply for a patent if you haven’t already done so, help get the product manufactured and marketed, and get it to the marketplace. Did you know that 87% of inventions and products that have gone through a business incubator process succeed in the marketplace? That is a very high success rate considering the fact that many businesses fail within the first year.

Dentcubator is made up of some of the best and brightest minds in all aspects of dentistry, including Steve Buchanan, John McSpadden, Ron Jackson, Sally McKenzie, Lorne Lavine, Sonia Leziy, Ken Malament, Joerg Strub and Mauro Fradeani. What has always been interesting to me is a dental product that is successful in North America may not be successful in the Eastern European, Middle Eastern or Asian markets. Products need to be tweaked for the global dental market to address the needs of different dentists internationally. Dentcubator has dentists and business people from all around the world who know their markets well and have been successful in turning inventions into tremendous business opportunities in the vastly different dental cultures and markets globally.

Dentcubator is focused on identifying and acquiring proprietary interest in promising dental products, providing fledgling dental products with management guidance, technical assistance and obtaining financing necessary for product development and company growth. Dentcubator’s capability is a dream come true for dental visionaries and entrepreneurs who previously had no outlet for their creativity and product development and have wanted to impact the global dental market.

People bring me dental inventions all the time. I look at them only from my singular perspective. If it addresses a need that helps my daily challenges in dental practice, then I think it’s a good idea—but I could be wrong. If the invention doesn’t speak to me at all, but addresses a challenge of many other dentists in the way they practice, I may not even recognize it. That’s why the network in a dental incubator company is so important and worthwhile. A committee of seasoned dental entrepreneurs who have proven market experience can turn a good idea into a successful dental product company.

Do you have a new idea or product that you wrote down on the back of a napkin, already have a patent for, or always wanted to explore? Feel free to contact me at drmalmacher@thedentistsnetwork.net if you are a tinkerer, inventor, or have the next big thing that will change the way we practice dentistry and make our patients lives better.

Dr. Louis Malcmacher is a practicing general dentist in Bay Village, Ohio, an internationally known lecturer, dental consultant and author, and consultant to the Council on Dental Practice of the ADA. Interested in knowing more about how to truly enjoy dentistry? Click here.

Interested in having Dr. Malcmacher speak to your dental society or study club? Click here.

To reach Dr. Malcmacher, email him at DrMalcmacher@thedentistsnetwork.net or call 1.800.952.0521.

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Dr. Lorne Lavine
Dental Technology Consultants
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Word-Of-Mouth 2.0

It is an undisputed fact that in the world of dentistry, no amount of expensive advertising or fancy marketing can best the power of word-of-mouth referrals from your satisfied patients. What your patients say about you is the ultimate driver of business success.

Today, consumers increasingly turn to the Internet to locate and select a dental practice. Understanding this phenomenon and using the right tools will help you create and maintain the most relevant, valuable practice builder you’ll ever have: the experience and feedback of your own patients, shared with millions of prospective patients actively seeking a new dental practice. It’s up to you to choose: Will your online reputation consist of a single thread of random gossip, or will it become your most valued asset, carefully managed and nurtured to give you the best return on your investment?

Leveraging Google to Drive New Patient Volumes—As you probably know, the largest and most powerful search engine is Google. Today, 67 percent of all online searches are conducted using Google. Google sees 3.2 billion—yes, with a “b”—visits per month. As a dental practice, you can optimize your Web site to come up in the free, natural search results. If you choose to pay for exposure, you can subscribe to Google Adwords, paying for each “click” generated from Google to your Web site. The higher you bid for a click, the higher your placement in the sponsored section of Google. There are many dental practices that bid more than $6 for every click, resulting in thousands of dollars spent on Adwords each month. One particular practice I am aware of spends more than $3,000 a month on Adwords and claims the cost is “worth every penny.” As with all advertising it has limitations, beyond even expense. Ads are companies promoting themselves, and today’s savvy consumer recognizes this and filters information accordingly.

Build Your Online Reputation Now—So how do you, as a dentist, take advantage of this new tool to guide and shape your online reputation? It is important to remember that this is not a practice snapshot in time, but rather a reputation built and sustained over time. Your best chance of securing and maintaining a “top 10” placement is to be among the first to populate your Google profile—and to keep a steady stream of relevant reviews and quality practice information flowing in to Google. You can do this one of two ways: passively or actively.

The Passive Approach—You can hope the patients who visit your practice have the wherewithal to create a Google account, find your Google profile, and submit a review. This requires time and effort on your patients’ part, and staff time to inform patients and promote the process. Even if your staff is dedicated to making your patients aware of the online review process, you can only hope they remember to follow through once they go back to their busy schedules at home and work. If history is any guide, a passive approach will result in one or two reviews posted over the course of several months.

The Proactive Approach—Today, the only integrated approach to proactively managing your online reputation in Google is through Demandforce, an online patient communication company. They recently announced a data integration agreement with Google that enables dental practices to easily populate their Google profiles, including posting reviews, directly from data originating from the Demandforce communication system. Each patient is automatically sent a thank you email message after each appointment. As part of the thank you, he/she can choose to submit a confidential survey of the visit as well as a public review. Practices can read the reviews and post a response or ask for a review to be removed if it does not meet standard posting requirements. After seven days, the data is automatically sent to Google to populate your profile. This proactive approach results in dozens of reviews being posted to your profile every month.

Whether you opt to take a passive approach or a proactive approach to build your online reputation, I highly recommend you take charge to ensure it accurately reflects and therefore benefits your practice. Your online reputation is your business and those practices that realize it early on will have a significant head start over their peers. Solicited or not, online reviews are here to stay. Our patients’ satisfaction and their resulting word-of-mouth referrals will always be our bread and butter; only the serving plate has changed. What are you doing to shape your online reputation? Have you “Googled” your practice or your competitors lately?

Lorne Lavine, DMD is the Founder and President of Dental Technology Consultants. Dr. Lavine holds two prestigious certifications, the A+ Certified Technician designation and the Network+ Certified Professional. These designations demonstrate proficiency in computer repair, operating systems, network design and installation. Dental Technology Consultants provide dentists a full range of services relating to the implementation of technology.

Interested in having Dr.Lavine speak to your dental society or study club? Click here.
Dr. Lavine can be reached at drlavine@thedentistsnetwork.net.

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Bruce Bryen, CPA.
Managing Partner
The Snyder Group, LLC
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Accelerating Real Estate Deductions

The following article is about the advantages of a little-known method of accelerating the tax write-offs for real estate.

With the economic slowdown we are experiencing, many dental practices are not generating the same cash flow that was available just a few years ago. Those with real estate are finding the values dropping and financing efforts more difficult.

The practicing dentist may spend time with his or her advisors analyzing the dental practice for ideas to improve cash flow. A good CPA who works with dentists can give input into better business procedures and tax strategies for improving the practice’s cash flow. During the year, questions will arise about the acquisition of equipment and its depreciation write-off and what that does for operational increases in money flow. Some dentists acquire equipment because of the fast allowance granted by the government for wear and tear allocated to it. Financing is usually available from the dental supply house or other lenders because of its secured nature. The tax write-off from the equipment purchase creates an immediate source of cash flow by reducing the current tax burden for the dentist. In addition, if financing is part of the acquisition, payments may not have to be made for months, which also increases the flow of funds to the practice.

An area of interest for the dentist that is not well known by advisors is a quick method of depreciation for real estate that, like equipment, can create immediate cash flow by the use of an accelerated method of depreciation. Commercial real estate is normally allowed a depreciation term of thirty-nine years. (Residential real estate can be depreciated over a twenty-seven-and-one-half year term.) Discounting the land, that means that for a commercial dental office with a price of $780,000, the annual depreciation is $20,000 ($780,000 ÷ 39 years). There is a method of depreciation known as cost segregation depreciation that allows the depreciation to be taken over the life of those individual items that compose the real estate’s construction rather than the total cost of the building as a whole. As an example, the heating and air conditioning units have a specific cost and estimated useful life that is different from the composite building’s life. Partitioning walls for individual offices, rugs, glass inside the building, plumbing fixtures and kitchen areas and appliances all have useful lives that are less than the footprint of the building. If the $780,000 cost of improvements were to have an allocation of $680,000 for items with estimated useful lives of ten years, as an example, that amount ($680,000 ÷ 10 years) would generate a $68,000 depreciation deduction plus the balance of the $780,000 minus $680,000 ($100,000) ÷ 39 years of depreciation, which would generate an additional $2,564 of depreciation ($100,000 ÷ 39 years). The dentist with the real estate would now have a $70,564 write-off ($68,000 + $2,564) instead of $20,000 ($780,000 ÷ 39 years). Assuming federal and state income taxes at a 40% rate, the dentist generated cash through tax savings of $28,226 ($70,564 x 40%) minus the normal savings of $8,000 ($780,000 ÷ 39 years x 40%), for an additional $20,226 per year for ten years..

By accelerating your real estate deductions through the use of quick depreciation, you will have increased your cash flow by $202,260.

What use do you have for these additional funds now? Do you pay down more expensive debt, invest at today’s low market prices or contribute to the dental practice’s retirement plan, which you could not afford to do without this new source of cash?

Of course the depreciation cumulative total is the same for the building no matter what method you choose. The advantage of the cost segregation depreciation concept is the use of the present value of the funds and the sources available for use of those funds. Having the money available over ten years rather than thirty-nine years creates a faster generation of cash. Those who have a need for additional funds should learn more about cost segregation depreciation and the concept of the present value of the use of funds.

For more information about the advantages and disadvantages of using cost segregation depreciation, please contact the author at The Snyder Group, LLC.

Bruce Bryen, CPA has successfully assisted dentists with their personal and financial matters for more than thirty years. As a partner in The Snyder Group, he delivers creative and prudent financial strategies to help dentists build and protect wealth at every stage of their careers. His extensive expertise includes financing, debt restructuring, retirement planning and tax advising to help dentists keep more of what they earn.

If you would like additional help or are interested in having Bruce Bryen speak to your dental society or study club, he can be reached at bruce@thedentistsnetwork.net or at 1-800-988-5674.

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