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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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"I am happy with the support provided and information offered to me by my practice analyst during and after practice transition."

Anna Ellerin, D.D.S.
Westwood, NJ

"My AFTCO Analyst was knowledgeable and always available to answer my questions and concerns. His immediate response to all inquiries from me and interested parties moved the process forward quickly. He gave me the assurance that all the issues were being dealt with fairly."

Anthony J. Piniuk III, D.D.S.
Philipsburg, PA

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John C. Sanders, D.D.S.
Pickerington, OH

"Under very difficult circumstances, AFTCO was able to help guide the seller to assemble the required documentation that was basically non-existent. His patience, compassion, professionalism and coordination of a very difficult process are to be highly commended. I do not believe most dental brokers would have been as diligent and persistent while maintaining a fair and equitable relationship representing both the seller and buyer. It is obvious that my analyst's interest was to create a "Win-Win" result for all parties. In fact, he accomplished his goal and objective in the most professional manner possible. Thank you!"

Edward H. Hobbs, D.D.S.
Garland, TX