The North Costs More

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Dental Elite’s Leah Turner: The true cost of running a northern dental practice

Recently, it was announced that the Unit of Orthodontic Activity (UOA) benchmark price is going to be decreased in the North to accommodate for the lower cost of living, wages and operating costs.

However, we would argue that this doesn’t consider the true cost of running a dental practice, and as such, we sought to find out if the day-to-day running of a dental practice up North is cheaper than in the South. We did so by looking at a sample of 630 practices valued from October 2017 (this includes all dental practices and not just those with orthodontic contracts).

We found that the Midlands had the highest percentage of staff costs at 21.06%, with the North East and North West coming in closely behind with 18.11% and 18.55% respectively. By comparison, the Central Belt and London and the South East had the cheapest staff costs of the lot at just 15.25% and 15.86%.

On the surface, these statistics may seem surprising, as you would expect the North to have the lowest expenditure for staff given that the cost of living is cheaper. However, because of difficulties recruiting to these areas, Northern practices must use money as leverage to entice nurses and other dental professionals to work in the profession. This isn’t the case in the South where support staff jobs are in demand and competition is high.

Negative Impact

As for Units of Dental Activity (UDAs), the payout rates were found to be higher in the North than anywhere else in the UK, making running a practice far more expensive for practice owners there. It was a similar case with UOAs, as London and the South East had the lowest percentage of payout for all the areas, according to the data.

It must also be noted that the London and South East area had a much higher percentage than the North East for EBITDA (earnings before interest, tax, depreciation and amortisation). This indicates that practices in the North East are making less of a profit than in the South.

Altogether, these results produce two key findings – the first is that it is not in fact cheaper to run a dental practice in the North, as was previously thought. The second is that the NHSE’s decision to decrease the benchmark price of UOAs in the North is likely to have a negative impact, because if the rate is reduced but the pay rate is kept the same, then practices will be even more out of pocket. This shows just how competitive the market now is, especially when it comes to dental recruitment.

If you need help recruiting associates to your practice, get in touch with the Dental Elite team. Highly experienced and innovative in the way it approaches the recruitment process, you are sure to boost your chances of filling empty vacancies. Or if you’re running a business and want to know how the above data relates to you and the value of your practice, speak to our expert dental sales team.

Author

Leah Turner is the Practice Sales Director of Dental Elite. For more information visit www.dentalelite.co.uk, email This email address is being protected from spambots. You need JavaScript enabled to view it. or call 01788 545 900