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Brisbane practitioner and business trainer Dr Simon Franks believes Australian dentistry is at a critical juncture, claiming better business models are needed to ensure security through 2026 and beyond. By John Burfitt
When Dr Simon Franks was a boy growing up in New Zealand, he often listened to his mother, a bank manager, talk about her clients. One comment has stayed with him. “She said medical and dental practitioners had the worst financials of anyone she dealt with,” Dr Franks, the owner of Brisbane’s Bite Dental, recalls.
Two decades into his own dental career as both dentist and business trainer with his agency Insight Dental Consulting, the warning feels prophetic. “Right now, dentistry is at a turning point,” Dr Franks claims. “It’s not the lucrative business it was in the past, and for many, there are big challenges. It’s a matter of charting a better way with the business side of our profession. If we don’t, I genuinely fear where we might be headed.”
Dr Franks has spent 15 years in dental and business coaching and started Insight Consulting two years ago. He completed neuroscience studies at the University of Otago before graduating from the University of Sydney with a Bachelor of Dental Surgery (Hons). He later earned a Master of Clinical Dentistry in Prosthodontics from King’s College London and is a Fellow of the Royal Australasian College of Dental Surgeons.
As lead author with Insight co-founder Jeremy Butts of the report ‘The State of the Dental Industry: Financial Certainty in Uncertain Times’, Dr Franks has spent the past year reviewing the books of Australian practices. The report summarises that “understanding financial documents is now more critical than ever and provides a clear view of the industry’s evolution from past stability to future uncertainty”.
The data paints a sobering picture of Australian dentistry wrestling with rising costs, shrinking margins and a business model that no longer makes financial sense.
Dr Franks says one finding stands out—profit margin can mean the difference between success and failure. He claims too many practices chase more patients, treatments and associates in the quest for greater revenue, but without the profit discipline to ensure those numbers translate into cash. “Revenue is irrelevant if it doesn’t cover the cost of goods and operations,” he says. “You can’t pay bills or wages with revenue; that’s only possible when you’re making a profit.”
Reality check
While a single-chair practice in the 1990s could bring in around $400,000 in revenue with strong double-digit profit margins, today’s multi-chair, tech-heavy operations are often producing single-digit profits.
Overheads have soared while fees have stagnated. This is a time, Dr Franks claims, when many practice owners’ financial literacy is being tested as they face rising wages, tighter lending conditions, higher equipment costs and patient resistance to fee increases.
The Insight report’s case studies confirm this. One suburban practice recorded $2 million in revenue and a 12.5 per cent net profit margin, totalling $250,000 on paper. Yet after tax, staff entitlements, equipment depreciation and loan repayments, it was actually $40,000 in the red.
Financial literacy
“You need to learn how to read financial documents and have a working knowledge of what insights each offers,” Dr Franks says. “Chasing revenue and seeing big numbers coming in is a waste of time if you’re not making a profit.”
[Dentistry is] not the lucrative business it was in the past, and for many, there are big challenges. It’s a matter of charting a better way with the business side of our profession. If we don’t, I genuinely fear where we might be headed.
Dr Simon Franks, owner, Bite Dental
He learnt that lesson himself through Bite Dental’s evolution, which he purchased in 2010 and then grew into a multi-chair practice. Even though the practice was busy, the ongoing challenge of profit margins eventually led to its restructuring in 2024—this included cutting non-profitable services, downsizing staff and focusing on core strengths.
Today, the practice has a streamlined model, with Dr Franks and a hygienist. “It might be smaller and the revenue less but overall, it’s far more profitable.”
Know your numbers
Dr Franks says it is not good business for an owner to hand over all financial affairs to a practice manager or accountant without comprehending profit margins. Understanding the figures in a profit and loss statement, balance sheet and, most importantly, cashflow forecast can separate sustainable practices from those headed for tough times.
“Don’t let yourself be scared and if you don’t understand, get good advice and take the time to learn,” he says, adding more focus on business basics should be included in the ADA’s current CPD guidelines.
“Every dollar has to be accounted for, and you have to know if it’s earning or costing the practice.”
Track profitability
The Insight report shows while complex restorative or implant work might appear lucrative, high lab and material costs, as well as time-consuming procedures, can erode profit.
“Know your services and the profitability of each one— from implants, orthodontics, root canals and fillings through to simple cleans,” Dr Franks says. “You’ll make profit on one and take a bath on another.”
He notes that junior dentists often deliver better margins than senior practitioners chasing complex cases that don’t always earn as much. “Those bigger cases may be more interesting work than a clean, but you could end up losing money hand over fist.”
Restructure the model
Challenging the business model many practices operate with their associates is, contentious Dr Franks claims. “But it needs to be challenged. That traditional 40 per cent commission model, which was sustainable in the past, no longer fits today’s environment.”
The dollars you spend on marketing should result in a net profit, not just increased exposure. If it brings in $2 million but you’re not making more profits, why are you doing it?
Dr Simon Franks, owner, Bite Dental
He claims it can leave practice owners shouldering losses once debt and risk are accounted for and insists commission structures must fairly reward both principals and associates for their risk profiles.
The Insight report recommends a salary be paid to associates instead, with a bonus structure attached. “A fair structure is when the business does well, the associate does well, and everybody wins.”
Make marketing work
Profit margins must be the focus of any marketing budget. “The dollars you spend on marketing should result in a net profit, not just increased exposure,” Dr Franks says. The Insight report notes that digital advertising costs have surged and “returns are unpredictable”.
Dr Franks also warns that adopting copycat marketing strategies is risky. “Each practice operates within a unique patient demographic, so know what works in your area, be specific and focus on doing that.”
Be efficient
Efficiency is key to a well-run practice, which might mean greater adoption of AI-driven tools, outsourcing administration, and negotiating better rates on leases and with suppliers.
“If you can improve your gross profit margin by just two per cent, it can transform your bottom line because your overheads stay the same,” Dr Franks says.
The financial stress of being in business comes at significant personal cost, and Dr Franks admits he worries about the long-term emotional fallout for practitioners. “I fear we will have a mental-health crisis in dentistry if these business issues are not taken better care of, and soon.
“When you’ve got a problem that’s not addressed, it festers and becomes harder to deal with. But focusing on understanding your business systems, along with the clinical ones, can change everything so much.”
