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What should the overhead percentage be for a general practice?

Overhead expenses should be 50% to 55% of annual gross collections for a well run general dental practice if you do not include the doctor's clinical and management compensation. Too many profit and loss reports fail to recognize the practice owner's clinical compensation which should be 25% of annual gross collections (which is what it would cost if you had to hire an associate to do all of the clinical work in a practice); then you should add another 5% of annual gross collections as management compensation (which is what it would cost if you hired a manager to operate the practice). When you recognize the clinical and management compensation as an overhead expense, the overhead percentage should be 80% to 85% of annual gross collections for a well run general dental practice. This leaves a 15% to 20% passive profit margin for this practice, which would be considered ideal. See Less

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Client Testimonials

"My AFTCO Analyst has always been professional and courteous. He is straight forward and very helpful. I would recommend AFTCO to any buyer or seller."

Bridget Reilly Sheahan, D.D.S.
Spokane, WA

"My AFTCO Analyst was great. I talked with him over a six year period and he was always interested in finding the right person within my time frame for the transition. I couldn't have made the successful transition that I did without AFTCO."

Stanton D. Dunn Jr., D.D.S.
Scottsburg, IN

"My AFTCO Analyst was a great person to have when buying my new practice. He was knowledgeable about the practice, the area, and was quick to provide information when needed. I would refer people to my AFTCO Analyst if they were looking to buy or sell an office."

Keith A. Blessitt, D.M.D.
Nokomis, FL