FEES FEES FEES! Is it the price, or the VALUE?
There's been a lot of talk about fees lately so of course I'll give my 2 cents!
When I started my practice 20 years ago there was one other practitioner in town. I opened my own place with no patients and basically charged the same fee (maybe slightly lower, can't remember) as the other Orthodontist in town, which compared to surrounding cities was average or slightly lower than them.
About 3 years later, I bought the existing Orthodontist's practice and until about 3-4 years ago was the only Orthodontic practice in town.
From DAY 1 all I ever read or heard from consultants, accountants, etc, was to automatically raise fees 3% or more each year. They constantly pushed the math which says you can raise fees x amount, and lose x plus y number of patients and still make more money with less patients to worry about!
I never signed on to this. As the only one in town for 15+ years, I didn't want to give anyone a reason to go out of town to get their treatment. As towns around me were raising fees, I kept a lean, mean operation with excellent treatment and customer service, a great facility that has been updated several times, at an excellent price. Not super low by any means but definitely average or below average for my state.
Now, fees are really a very personal thing. And if one's philosophy is to charge high fees I HAVE NO PROBLEM WITH THAT WHATSOEVER!
My philosophy for average to low fees revolves around my statement above plus:
Market/Market Share- not only do I want to expand my market share (the pool of ortho patients looking for a provider), I also want to expand the Market itself (any patient who can benefit from orthodontic treatment). I feel by keeping fees "affordable," many patients who would never have thought of getting treatment done can consider it because it is not prohibitive to them. I feel I have really succeeded in my area in increasing the Market, not just Market Share.
Competition- When Dentists providing ortho or other Orthodontists coming into the area consider competing with my office, they need to consider not only our excellent customer service and hi-tech facility, but they have to consider our low fee as well. Sure they can try the "charge more" perception of higher value but once patients come into our office they see the extremely high value we already provide at a super-reasonable fee. That's tough to compete against.
The "sleep at night" philosophy- again this is a personal thing. I feel I have a pretty easy gig. Yes as a business owner with staff issues, business debt, etc, it's not the easiest job in the world but in general it's a pretty nice lifestyle. In fact, I wouldn't trade it for most any career I can think of! So I feel better (probably a rationalization, I know) when I know that in my community I'm not pushing the top limit of price point all the time.
I think the most important point in setting your fee is that you need to create VALUE. If your fee is high, you need to make sure the value is there to warrant the higher fees. The value can be in the form of excellent treatment results, great customer service, facility amenities (coffee, ipads, etc.). But this value isn't worth a thing unless you can properly communicate it to your patients.
Ok that's long-winded enough!
Comments welcome!
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