Building or Remodeling the Dental Practice of your Dreams Starts with this Episode!

Hey, dental associates and new practice owners. Welcome to the Associates on Fire podcast. Powered by Practice cfo. This is the podcast that teaches you what you never learned in dental school. The financial side of dentistry. We cover topics from planning for ownership, buying a practice, to student loans, taxes, and all things financial for the hungry to learn Dental Associate. So let's light it up.

Welcome back everyone to the Associates on Fire podcast. My name is Drew Phillips and I'll be the host of today's show episode. For those who haven't had a chance to check out our Associates on Fire program yet, I'm a CPA and CFO advisor at Practice CFO and one of the instructors in our Associates on Fire program. Be sure to check us out@asschoolsonfire.com today. I'm excited to introduce the author of Dentale Ease and CEO and founder of Denco Construction, Steve Anderson. Steve began his construction career in 1984 and and founded Denco Construction in 1997. During his career, he has helped over a thousand dental professionals build or remodel the office of their dreams. Every dentist out there knows that specialization in their field is important, and Denco Construction has embraced that completely by building out a team of individuals dedicated to building and remodeling dental practices. And it's through all of these years of experience in the dental space that has provided Steve the knowledge and expertise necessary for to write a book as comprehensive as Dental Ease. In the book, he goes through every step that a dentist will endure during their career. From start to finish. He raises important questions that need to be answered and defined during each step along the way and provides helpful real life case studies for context. I was particularly impressed with how the book was able to demystify the world of architecture, design and construction, especially within the context of dentistry. You know, one more thing before we get started here, I just have to toot your horn, Steve, because if you go to either dencoedental.com or dream dental practice.net and you take a look at Steve's portfolio of dental practices that he's either built or remodeled, it is absolutely mind blowing how stunning these practices turned out. And if you're in the need for inspiration for your practice or your future practice, I'm confident that his portfolio will help. With all that being said, let's jump in and hear from Steve Anderson. Welcome Steve.

Well, thank you so much, Stuart. I appreciate you having me today.

Steve, let's start out by hearing a bit about your journey and how you found your way into the dental space.

Well, it's Very similar to what some of the dentists experience. Basically I was in the regular construction doing a little of everything, even industrial and hazardous and strip center and lots of medical and dental and. And one day I was driving to work and going, I gotta change something. I'm tired of being everything to everyone. And I have, I'm very tired of having no value. And in the dental market, the construction market is just basically, give me a number and you're known by your number. And I'm going, that doesn't work for me. I hate to say it, but I have a need and that needs to be valued. And so I'm going, okay, what can I do different? And so what I did was by the time I got to work and it was only a 15, 20 minute drive, I came up with Denco Dental Construction because I realized that dentists were the one major field that I saw that needed the most help. And repeatedly I had visions of doctors and questions and so what now what? And how do I proceed? And it kind of took off from there.

You mentioned that one of the driving forces for moving to the dental space was your desire to be valued and not just another number or bid. And I feel really similar in that regard. Our dental clients are some of the best clients I've been associated with across any industry. And the reason is they're smart and they know where they excel and where they need help. And they're appreciative of the value their strong partner brings to their organization. For me, as I'm sure it is for you, it's knowing that you're bringing tremendous value to your client that gets us motivated to get out of the bed every day and make a difference.

Using that as a segue, one of the sections in Dental Lease that stuck out in particular is your depiction and characterization of what a great professional should look like and the attributes that they should possess. You go on to explain the differences between a professional and an accountable professional. And I'd love for you to give our listeners a recap of those differences.

Oh, that's, it's so, so huge.

And the results are totally opposite. So what happens is, Drew, if someone comes in and most dentists, most professionals just go at the process and they just start interviewing everyone and sometimes they just pick the lowest one and off they go. And there's nothing associated with it other than, well, we got a price and it's cheap. And what they forgot to mention is this is their future they're after and they want the best. And a lot of times the Best can be had for free, such as in real estate. That's one of the big things that blows my mind. They go out and do all these dumb things other than find the best. And what happens is by finding the best, I mean people that are accountable, people that when you sit down, they offer suggestions to you rather than little telltale signs, different from a great professional that will really help your team and assist you moving forward versus someone that just is more about your wallet. And, you know, so when you finish a conversation, you just pour your heart out and say, here's my dream, here's what I'm after, here's what I want to do. And they come up with something totally off the subject that they've been dreaming and thinking about that they want answered, and they haven't been paying attention to you. That's number one. And then, and then other questions, such as you're talking about things and they literally will come up with what's best for them. They'll come up with higher price things. And they don't give you options. They just say, yeah, we can do that. Yes, yes, yes. And they become a yes person. What you want is someone that gives you options, someone that is really. You can show that they have an interest in not your wallet as much as it's more about making sure that what's best for you and your decisions as you move forward. And it's, it's really changing your thinking and changing your listening as you're talking to these people, are they really listening to me? And do they really desire my best interest? And, you know, and then it gets into the. As you find those accountable people, they have no problem in, you know, using the smart process, you know, and putting it down in measurable and accountable terms and giving you timelines and time frames and keeping you in check rather than you have to chase them and what are we doing today? What's next? So what you know, and, and that's not a good accountable teammate for you. You want someone that's basically driving. And a lot of times when I meet with a client, I ask them, do you, Can I have your permission to help drive this? Or is timeframe not concerned for you? And in most of the projects, timeline is very critical, and timeline can escape the entire process if no one's driving it.

Yeah, you know, I don't think in what. I don't want to clarify, Steve. I don't think Steve is saying that professionals that you surround yourself with should blindly lead you or blindly follow you. But what he's saying is that they should hear you.

Yes.

And then they should give you context around every single decision that you're trying to make and help you bring that vision to life without going through the normal pitfalls of someone that would work with an otherwise. Someone that doesn't have as much experience in dental or construction or architecture and so on.

Absolutely. A great example is, you know, I think back of a broker one time and the client was sharing with me the instance of um, he showed the exact area that he was interested in. So they went, looked at an office over that area and then all of a sudden they get in a car and he's driving literally almost an hour the opposite direction in another part of town. And he's going, what are we doing? And he's going we're looking at another offices, I'm interested over here. And. And it was, you could tell it was just totally self serving. Why'd they look at the other place? Because he had it listed and he was the listing broker and he was trying to sell it. And so that's such a great example. Or you know, you sit down with an equipment person and so they talk about the top of the line everything and you're one of those that's more of the middle line. You're looking at, you know, it's your first office and you want to make good choices but you want to find things that are within your budget and then when, if they are an expensive item and it's always best to choose the best, maybe choose one or two rather than outfit an entire office such as, you know, a lot of times we'll recommend just two or three ops to start in a lot of offices rather than totally outfit five or six operatories. You know, it's things like that that really make a difference.

When you're coming out of dental school and you're looking to be an aspiring practice owner, you typically start with a dream. And for most it's a dream to have the best and brightest practice. And what I gathered from your book in particular is that you can have the dream that you want without breaking the bank. And keeping in mind that there are restrictions in this industry in terms of what the banks are willing to lend, which limits the amount of cash that you'll have to build out your dream practice, making it even more important to surround yourself with people that specialize in dental. Because if you want to get even close to building out the practice of your dreams while staying within the lending thresholds that are a part of this industry, you, you're going to need someone with the right processes and teams in place that has a track record of success. Steve, I want to hear about some of the projects that you've done in your life that you would like to share as being memorable or that could add value to a doctor looking to remodel or build out a practice right now.

Great, Great idea. You know, let's talk. I have some case studies in the book, and they're in the back, and there's some that stand out, and some are great, some are terrible, and some are in between. But the purpose of them is to help you understand and conceptualize what can happen when you don't have a solid team. One comes to mind is I sat down with two doctors and they showed me this floor plan, and I'm going, this is terrible. I mean, for a dentist, there was literally nine operatories, and not one of them had the same shape. There was trapezoids, there was boxes, there were squares or rectangles. There it was. And the point of entry was different on everyone. And I'm going, oh. And I. I stopped and I said. And then I noticed one other thing is their offices were twice the size of an operatory, and they had two. And there were opposite corners way up front in the office. And I'm going to. And then I see this dotted line down the middle of the space and the sterile in between. And so the sterile was in the right position, but it had a line through it. And I'm going, could you help me with. What am I missing here? He said, well, we had someone draw this up for us, and we thought it'd really help us. And I said, okay, but what's with the line and what's with the offices? And he goes, well, that's in case we split up. That's so we can instantly just put a wall between and we could continue on with our practice. And I said, okay, ask number one. I said, stop, and I'll come back in a week or two. You tell me and you decide if you're going to continue as a partner or not, because you shouldn't even consider this. And then second is, let me get someone involved that really understands the dynamics of a good flow and design, and we'll talk about your operatories. And I did a little program meeting with them, and they said, yes, we want to proceed. And we came back and the floor plan was day and night. The one thing that didn't change the size of their offices, and we moved into the back a little bit, but they still had to have the big offices.

Everyone has their different program. And that's the other thing. Another one comes to mind is thinking about a doctor that wanted to his end goal. He loved to get into dentures. He'd love to get into implants and all those type of things. And he said, I found this office. It's a great location. And it was right across from an older community. And I said, that's okay, but you're going to spend five times as much if we go over this other community and it's right on the corner and great visibility and you could spend $40,000 to get in. You know, it's not going to be ideal, but it's going to be a step. And so what I told him, Drew, is think about it. He came back, said, let's do the $40,000. And in the process of that, he. About a year went by, and he says, look, they built a building behind me. And I said, let's check it out. And so we put him upstairs into the new place and we put in a. A really nice office. And by then he had. He still had $200,000 school debt. And. But he's really liking the process. And he goes, wow. He says, steve, I'm loving this. You know, I've been able to build up practice, and you know what? I'm going to take a month off, and I'm going to go take my family and we're going to go check the country out. I run into rv and here we go. He says, when are we going to be open? I gave him a date, and he literally showed up a day and a half before opening. And while he was gone, we had moved his office. They tore down the old building for the parking lot, and he walked into his new space. And then two years later, he goes by and he says, you know, Steve, I've got my debt paid off. What do I do? And I said, well, you see that land? We looked out the back window, and he says, why don't you just buy that? And he said, well, you know, over here, there I can do. He says, well, right now you're not ready for it, but this is even a better location you're at right now and go buy it. So we connected a year later and. And the land had gone up $100,000. He said, Steve, let's start building. I says, no. I said, the market crashed a little bit, and there was a fabulous piece of property with a building already built out, and it had this freestanding building that could do Everything you wanted. And, and I said, sell the land. And he did, and he bought this building down there and he was able to do the building of his dreams.

I was going to say, do you, so do you get involved, like do you work closely with, with brokers to, to help search for properties like that? Or you just have such an intimate understanding of that particular area that you were able to guide him in that way?

No, that was going on and it's not always the case, but it's really about. There's many times I wish I was a broker.

But, but it really. And I say that jokingly because as a dentist it's the same thing. Well, I can do. And if I'm a journal, oh, I can do endo and I can do braces and I can do. And sometimes you get try. You have your fingers in too many things and your, your specialty is lost and your skill set gets lost. And so I, you know, tell the doctors it's really important to understand who you are and what it's about. And for me, my scope of work was very broad and I kept honing it down to the point where I just doing dental and then I quit doing ground up and we just do tenant improvements and we do remodels and that's it, you know, and people say, well, do the building. I says, no, I don't do enough of them to be excellent at it. And. But what it does is no different than a dentist is. So when the dentist really hones in on who they are and what they're about, they start making decisions. Like, I talked to a doctor last week and he says, you know what? I'm in this new marketplace. I'm not going to have a checkout. I do everything in the operatories and we swipe cards and we do everything in the operatory and, and. But it helps people. I just visited with another one a week prior to that and he said, you know, I'm not going to have a cbct. It's a big range of things. But he says it doesn't fit my model and I don't need it. And I do this limited scope of work. I make a great living and I'm happy at it. And, and so it becomes, you know, the. As you fine tune. And that's one of the big things I share with people is it's so important to understand who you are, you know, and that's number one. If you don't do anything else, you don't get anything else out of this podcast. Understand who you are what's important to you and what do you want?

And if you don't know where to start in his book, I mean, it's, I think it's almost a page and a half long of questions to ask yourself. So if you don't even know where to begin on how to define yourself, you can get some inspiration there. And I, you know, I think even a couple of those, I, I had to, I had to take a, a moment to think of it for my, for myself as well. So when you mentioned earlier about practice that you were the, one of the examples that you were given of the nine operatory space and all these different configured operatories that you basically have to do a cardio workout to around the place. Super frustrating for me when I'm helping a new buyer go into a practice that was structured that way. They didn't get Steve Anderson's last minute guidance to make a pivot. And you've got a doctor's office that is like the equivalent of two operatories and it's a three operatory space or a four operatory space that they've got massive capacity issues. What does that process look like if you wanted to come in and really revamp it? I mean, I guess it may be dependent on the space a bit, but how long of a process and what does it usually take to, to remove some of the inefficiencies that were passed down to the new buyer?

That's a great question, Drew. The, the, the big thing is, is once you understand what's important and what your pain points are, and I'll do another little side story is I had a doctor that I knew very well and he was very conservative, but he signed up for the scheduling institute. And all of a sudden he's experiencing this big growth of patients coming in and, and he's going, I need a bigger space. Well, I knew him very well and I'm going, this doesn't fit you. It's what you're talking about because he was in 1800 square feet and he says, steve, let's do lunch and then we'll go look at my 6,000 square foot office that I found.

And I'm going, that's a massive change.

Yeah. And also I'm thinking, I don't know. So after 15 minutes of talking and ask some pointed questions, I said, cancel the meeting. And he's going, what? I said, cancel the meeting. And it says you won't be in business next year and you won't like me. I said, I'm happy to spend $700,000 of your money. But I said, you know, it's not for you, doc. And I said, let's go back to your office and you know, we'll quick lunch a little early and I'll find your needs. His need was an operatory. His need was to have a consult area. He needed to be able to have a separate area for his CBCT because he was into technology and we for less than $50,000 he was able to do that. So which would you rather have to help build the practice and really solidify who you are to make that jump? There's some doctors can make the jump and then do some things internally. They wouldn't go right into 6,000 square feet, but they might go into 3,000 and they could rent out the other half. And so that's where every dentist is different. That's why I have like 20 case studies in the back is every doctor's needs are unique. And people say, well, should I buy or should I rent and should I lease and should I buy an existing practice? And it depends on the current market and it depends on what you have available to and around you. And there's all these extenuating circumstances plus your vision of what's, what's important to you.

It's like you said, each market and every decision that needs to be made is unique. And it sounds like you're taking the steps to evaluate and identify all of the opportunities that exist and then helping them make rational decisions based on what's available at that time. I'm going to put you on the spot here a little bit. If you went back in time and decided to be a dentist, but you were able to keep all the knowledge you've obtained over your career, how, how would you design your ideal dental office? What would it look like?

Well, first I would sit down and figure out what my vision is and then be able to create that program. A program is basically, we have a sheet, several pages in the book that talk about how many operatories and are they all alike or the hygiene and so on and so forth and talk about the waiting room and the size and getting all those particulars. But as what would an existing. What would a practice look like? For myself.

It would be an office that would be extremely efficient. It would have less operatories in, less cabinetry in the operatories.

It would use a bin system in the sterilization. I'd have a CBCT. I would invest in a 3D imaging, 3D printing and possibly the milling machine. It depend on Whether I want to learn that or have someone that was really good at it. But I think that's worth the investment. I would look at taking. Making sure the break room is set up in such a way that I can have team meetings, but also large enough that I could do study club and. And do other events and things and bring them in. I'd have a personal office that is designed in such a way that I would take the existing. Keeping in mind that I'd probably have probably eight operatories. And with that in mind, I'd be bringing on an associate at some point and make the office my private office, big enough that they could be in my office. Because that's one of the biggest mistakes I see is having two separate offices. And it creates division. I would have a small, and I repeat, small restroom off of my private bathroom, private office, and then the central sterilization area. I would invest in good equipment. You know, I really would look at the headwall system as a major investment. So I'd look at something like an ADEC or something like that really have efficiently laid out. I'd invest in a really good dental chair, you know, one that's going to last and. And it's not. Those are areas that I see that get cheapened. You know, I. I'm not a spring chicken, but I. I've gone through the pain points of trying to save a buck and almost get out of some of my little enjoyments. Point in case. Early on I remember wanting to go and do inline skating and stuff and I bought a cheap pair and I just about quit it. And then all of a sudden I got tried a new real nice set that was expensive, but my gosh, it was day and night. And the same thing happens with a dental chair is, you know, you get one that really. You don't have to worry about the repairs on it. You don't have to worry about a technician and something coming in. It does make a difference. I would invest in good equipment in the equipment room, you know, a good compressor and vacuum that. And it would be a dry vac, so it'd be environmental friendly and not waste the water that the wet vac systems go through.

That's just a tot. And then. And then the key of the office would be to build the office that fit my personality. And what I mean by that is I would love to have some little flares. I'd love to have some crown mold. I'd love to have some woodwork. I'm a carpenter by trade when I started and Some shows that those things that are important to me and, but not over the top. I, I could not work in, you know, something that's overly done. It has to just be tastefully done.

No, I honestly I think if, if anything that was probably one great commentary going to give I know at least a person out there some inspiration. What about the flow of the office? You know, you see a lot of traditional looks but I curious if there's like a flow that you find to be the most efficient and maybe cost effective too.

That's very much so. And you know, the one thing that gets spent the least amount of time on is quite often is the operatory. And I asked dentists to spend time doing their pros and cons. And so what's worked so nice, especially a new dentist, you know, you know, someone's just coming out of school or if they're residency or they have these opportunities to go and check out all these offices and phones are great. I love the little notes that you have now and you can put likes and dislikes, you can take pictures and drop them into that file and, and what's really nice is when you get ready to build your office, you have that there's just a huge catalog library of all the pros and cons. But. And you flip through it. So as you're meeting with your team member, you meet with your architect or your contractor and, and you can instantly know what you like. And sometimes it's more important what you don't like. And you know, so you know, as far as the, that'll help drive the flow and you know, and it's a little bit different for everyone. You know, there's some telltale signs that I tell people don't do but there's still people that'll break the mold and it's not good or bad, but it's them and you know, it's point in case. You know, typically you want a waiting room and it depends on the community that you're in. And people say what? Well, you know, if you're in a Hispanic area, they love family. And so if you're in a, you have a waiting room, it might be, you know, if you have six chairs, you might have a waiting room for 20 people. And if you're in a high end area and it might be one waiting room chair for every dental chair. So there the community makes a difference but also in your decisions and then also the level of design and you know, also do you want a place for the children? You know, so many people don't stop and think about that. And, and it can create and reduce the amount of stress for the team. If you had a spot like that. So. And then another area is restrooms. It's the, the thing that people stop and think about and don't take time to think about is how important first impressions are. So first impressions, you walk in the office and people go, wow, I feel comfortable here. They've invested some time money here. It's not over the top but boy, it's clean, it's presentable and it really fits the personality of the team that's here. And then they go to the bathroom and I always said this and then my wife and I went on a trip one time and my wife came out the door and wow, that's awesome. And but that's what I've always said is, you know, people really do make judgments that when they first walk in the door, but also they check out your bathroom and is it clean? Clean. And they take the time to just put, keep things orderly and as a nice looking bathroom. And then not having that inside the opera, inside the waiting room. The old standard was they just put it over in the corner of the waiting room and how embarrassing is it? Someone needs to go, your patient needs to go to the bathroom and they come out and everybody's looking at them. Doesn't that make you feel good? You know, and, and so position of things, you know, you have it behind that wall that it's closer to the checkout but it can still be monitored. You know, so the idea is also you don't. One of the big mistakes I see with a lot of architecture is they'll have the checkout and operatories right across from it to save space and stuff. A good architect will be able to take and shove, shove it off to the side and allow, you know, 10, maybe even 15, 20ft before they get to the first operatory. So it helps with noise, helps with confidentiality, it helps with just lots of different things. And you know, there's lots of simple design features that can be done to help reduce those stresses. And then, and then having time in place for operatories, you know, we've had doctors that will pack 10 operatories into 10 2,000 square feet. You know, that's 1 to 200 square feet. The average ratio is 1 to 350 closer to 400 square feet. So you get a 2,000, it's typically 5.

Well, it's like you said, build to your vision.

Yes, right.

So I mean if you have a doctor that is, well, for better, for worse, right? Profit centric. And that's all that person cares about. 10 operatories in 2,000 square feet. I mean, I don't know, what would you say if that was their most motive.

That was their motive and two years later they sold it and moved on.

Got it.

You know, so it. Your vision, your goals, you know, and it's different for everyone. I, I don't agree. What's a challenge is for that person that's moving in there, all of a sudden you got. It feels like a tight area. Because all of a sudden when you're, you're taking, you're, you're taking your ratio and cutting it in half, something has to give. So what gave in that office? The sterile was tight. The break room was a third the normal size. The private office was half of normal, you know, and the waiting room was okay. But, you know, especially now with COVID I mean, it's. People are standing outside and it's, it's really awkward.

Do you like what a patient can walk through after they've, you know, checked in? They're going back to their operatory, maybe with the assistant in hand. Do you like the. For them to be able to see every operatory as they walk in? Or is, is there like a, is there an aesthetic that you prefer to recommend when, you know, from a patient experience perspective, when they actually pass the front desk and they go back into the treatment area?

You know, the. It really comes down to individual dentists for that. So.

The less dental chairs a person can see as they walk into the office and into the production area, the better. And there's different ways you can do that, but it also depends on the space. And sometimes.

It'S a conscious choice point in case, you know, we've done where we'll have four ops opposite each other and then maybe a sterile in the middle or something. And sometimes we can move them apart. Apart and have a sterile and two hallways on the side. And it affords the comb beam the sterile and lab down the middle. And then they're not seeing the full office. And then it becomes nicer. But when you have a tighter office in width and that's where you have to deal with existing conditions and the dentist overall goal of the office and then trying to configure that you can still, rather than put them opposite each other, sometimes it becomes a situation where you take the four and then sometimes you put two opposite the other direction so your hallway. And they don't, they don't see the other Ops. There's, there's lots of creative things that can be done.

So. Yeah, no, that, that was super helpful. Let's say I have, I have a kind of an ideal doctor in mind, dentist in mind. And it's, I would say it probably makes up the majority, majority of the people that we work with. And it's not that their model is better than any other one, it's just they, they try to take a hybrid approach between, you know, really embracing quality and patient experience and putting that at the, at the, at the forefront. But you know, they still were, you know, still trying to, to drive income as well. And I find that, you know, when you take on that type of model, you usually need about five to six operatories because you're trying to, you know, you still have a slightly beholden to insurance companies, at least in the short term, until you can build a patient base and then slowly, gradually move away from that. But what would it take for a doctor with five or six operatories in mind? How much square feet to sort of bring to life what you were just mentioning, which is to have this, have the right feel, have the right patient flow and, and, and do that, do that the right way.

You're looking at between 2000 and 2400 square feet.

And it really depends on the location. Width will have a great impact on your final design. And then also the shape. Sometimes we end up with a trapezoid or we end up with something that might have an equipment room or a fire riser room that we can't do anything about that affects the corner.

And sometimes that'll drive the square footage up a little bit. And some of the designs also will end up with more hallways space. When you have more hallways, you have more dead space, which adds to your square footage.

Now the hallways can also add elements of privacy too though. Right. So if you want to have the privacy element, you know, I'm not necessarily trying to, you know, put a, put up a picture of a perfect office in anyone's head here. Like you mentioned plenty that it's, it's really dependent on the location and the budget and everything else that goes into that.

But if you wanted to add the hallways, are we going to get to that 2400 end of the range or maybe a little bit more?

Yeah, 2400 would do it. You know, that's, that's typically would be a very comfortable office. You know, we've. A great example comes to mind is I had the ideal eight operatory office and this doctor's plan we'd done six offices for the gentleman and he was semi retired and he had two offices that he never worked a day in. And so his premise was he brought people in and they worked it and then they were building it and they bring associates in and whatnot. In the process of that, we had eight ops and we were at 3,000 square feet. But what that looked like was just perfect ops. A really comfortable break room, very comfortable consult. That's one area that I see a lot of times people get too tight on and so there's nothing worse than you're trying to sell a 20, 30, 40, $50,000 case and they're squeezing by where kind of impression is that and how comfortable they want and you know, a comfortable waiting room and, and everything properly sized break room and so on. We, you know, just a year or two later we did an adopt and it was at 20, just over 2600 square feet. And I'm going wait a minute, what happened here? And it all had to do with the hallways and the configuration of the width of the building. So it's, it's just really interesting.

That is interesting. So you shaved 400 square feet off and didn't sacrifice really anything.

Everything was perfectly sized.

And in your world, square feet translates to dollars, right? In this market right now, what would you say the average price per square foot is to exactly what we've been talking about here to do a tenant improvement or to build out a six operatory space that's 2,400 square feet. Or you can even use your eight operatory 3,000 square feet example from earlier.

What you're going to spend if, if you're looking at a 5, 6 operatory in and it's a really good question. So let me. It's going to give you two answers here. So the first answer in this area right now and it will be approximately.

$250,000. Now what's interesting is from the east side of town to the west side of town, northwest side of town, that number can vary by 25 to $30 a square foot just in town here. And people say well how can that be? I literally had an office one time that was within 50 square feet of each other and they. And the cost for the build out was over $70,000 different. And I'm going to how is this? And I started looking at it and one had air conditioners and the other didn't. One had a fire alarm system and on the east side of town I could do it for $1500. It's $17,000 on the north side, west side of town.

Is that just vendor specific or was that labor specific?

Municipality specific.

Interesting.

And then. And then. Now let's take another dynamic that blows people's mind. If. If I'm at $125 a square foot here in Phoenix, I go to Texas, it's about 100, 105 dollars a square foot. Now if I go to Alabama, it's 160. Now if I go up to New York and up to Pennsylvania area, it's going to be 160 to 200. If I go to California, that 125 becomes 150. 40, 150. If I go up to the northwest, we're up to 200.

That's so counterintuitive to me that you can go to Alabama and spend close to $200 a square foot. But then in California, where it's 150, which. That is it. That blows my mind. So what do you. What's the cause for that?

It's supply, demand, and some, you know, there's. There is a mentality of, why do you charge it? Well, I can get it. You know, I've had that experience. I had one client that I swore I'd never do anything outside Arizona, and he. This was his third or fourth office with us. He says, please help me go clean that up. And I'm moving. I gotta get that done. And I can't find anyone. After the third time, I said, okay. I went and did it, and it was in New Mexico and the codes, but it was out in the middle of nowhere, so to speak. And, you know, even the developer that I was dealing with in the complex, I said, so this storefront in the Valley would cost me $3,000. And he says, yeah, 2500, $3,000. He built the building. And I said, we have to move, put another one in. He says, yeah, that'd be about right. So the cheapest bid I had was $6,500.

The cheapest. And we went over and talked to him, and I said, so why help explain this to me. And we made one little change, and it dropped it to 5,800. And then I said, so help us out here. He says, why is that? And he said, well, we get it because we can.

So middle of nowhere, New Mexico. The municipality is laying down the hammer.

Well, and, but, but I. And I don't want to pick out just New Mexico. It's, it's. It can happen. I had that happen in, you know, the north and south part of the states with certain trends. And a lot of times that's where we would literally take our team from the valley and do it less expensively in remote parts of Arizona.

Something comes to mind, and only you with your knowledge could probably pull this off. But creating a heat map across the entire United States showing the areas that have the most favorable cost dynamics. There are doctors that I work with that are coming out of school and most of our associates on fire listeners are at the earlier stages of their career. And some of those doctors want to find an area where they can put in 10 to 15 years and generate enough wealth that they have the option to do something else if they so desired. And I think a map like that could really help them pinpoint an area to give them the best shot of accomplishing reaching that goal.

But Drew, that's the wrong mentality. And, and, and, and no. Accept my apologies.

Oh, no, no, no. I want your candid feedback at all times.

This is candid feedback. So here's the thing is, it's no different than the buying cheap equipment and good equipment and, you know, where you go should not be hinged on what is it going to cost me to get there. It should be hinged on what's interesting. If you do what you're doing and you have a passion for it and you go to the area that is really in need, there's. There's so many spots in rural Arizona and rural America that are being underserved that you can knock it dead, knock it out of the ballpark. So think about it. So if it cost me even a hundred thousand more to go build it in rural Arizona, now, let's put it terms to that. What is that $100,000 in today's market? Market. How much is that payment?

Oh, it's not much. Maybe 100, a couple hundred bucks. Yeah.

You know, so put it in terms. And that's what we, you know, so we're, you know, $400 maybe, you know, and so that's what we really need. We get caught up in the dollar amount, in the difference. And that's where a lot of times, you know, well, I can save $20,000 on my $300,000 package of equipment, and they sacrifice something that really is going to hold them up better and serve them better.

Oh, you're absolutely right. If you're making a decision with that as your only tool or guiding metric, you would likely be doing more harm than good. But as an overlay or as a supporting data point in someone's overall assessment of Their future practice decision, I think you could shed some helpful insights. Even more so if someone is deciding between a few locations that they like and that final decision, decision of one area over the other, and they just need a little bit of help to get over the hump.

Yeah, so. So what you're. You're right, but what. But what really should be is you're talking to your professional. You're talking to your dental broker that really understands what the area is going, you know, the. And I'm not talking a broker that is far removed from the area. Someone that's really in the area and really understands what's going on in the marketplace right now, and they understand what's coming available and where. Where there is a lack of space and, And a lot of these.

Lenders that specialize have recommendations for people that can tell you where those spots are. And so you go into those voids where there's a need. And, you know, I think of my sister up in Iowa that she was talking about how well her dentist is doing, because the only dentist in a town of 15,000.

You know, and nobody. They can't get anyone, another dentist to move in. And the town's expanding and growing, and, you know, they're just naming their price.

And I'm not sure if this person wanted to live there or if they chose to live there because of this situation, but someone like that, they go somewhere in the middle of nowhere, Iowa, and, And with that many patients available to them, you know, the amount of time that they have to put it into their career is drastically shortened. Assuming, of course, that they have a strong personal financial plan and they're not overspending.

Well, and the other thing that's exciting about that is I know so many dentists that go. They want to be in that one area in town that is, you know, it's the choice place to be, or they go into a center. Well, the lease rate is $10 less. And I can be over behind that building over on the corner that nobody sees and what they don't stop and think about. So they. That choice costs them what it costs them 2, 3, 4, 5, $6,000 a month extra in advertising to find those patients because the patient can't find them. And if they just have a beautiful location.

A couple of areas like that in San Diego are La Jolla and Encinitas, and there are a lot of phenomenal doctors in those areas. But as a new doctor coming in, the amount of money that you have to spend to take enough market share to survive it's pretty high and it's probably not the easiest or the greatest route to success.

You know, a case study that I share that comes to mind along these lines is we have a client down in Tucson and very successful dentist. He was even in one of the magazines, 40 under 40 of dentists nationally. And in his office, what was interesting, he had some pain points and things that just weren't working and he just hated it. But his location into the strip center was such that you'd drive in and your focus would be on the grocery store, but you kind of ignore the dental office. And what was interesting is he was able to secure a space three doors down. 3. And built the office of his dreams. And what was interesting is the only mistake we made is it was too small because he moved and he hasn't had time to advertise since.

Got it. So the move positioned him in the shopping center where he was now in perfect eyesight of all the shoppers. That's free marketing. I love it.

Literally would walk in and go, when did you come to town? And he'd been there for five years.

This actually reminds me of something I saw in your book. It was a. It was a picture actually of a beige building. And it wasn't a bad looking building by any means. It kind of looked like a building that you would find in the middle of the desert of New Mexico or Arizona. But you took that beige building, you added color and some tasteful carpentry work to the outside. And it was amazing to see how a little bit of color and attention to detail can transform a building and really bring it to life.

Oh, thank you. Yeah. No, and it does. And that's where. And there's dentists. You know, there's. There's people that are out there, there's associates, there's people that have opportunities to get in a space and they might be moving horizontally, they might be taking over a practice. And it's not maybe the dream of their office, you know, where they want to end up. But it's a good stepping stool. And a lot of times we call it put lipstick, lipstick on a pig. You know, and sometimes it's worth it to spend that 5, 10, 20, $50,000. We just did that recently to an office where we put 50 to $70,000 in the office. And it was to spruce it up to a point where he could get production up, get them through another three years and then he's going to go and move. But it really makes that kind of return. And that's what the percentages. That, that's another thing is money is cheap right now and what a golden opportunity. And you think about the cost of advertising, it's a no brainer. And then on top of that you take in a new dentist or a dentist that relocates and put into a new office and he has an established practice. National average is like 34% increase the first two years. Just moving into the office of their dreams. Now what kind of investments do you know? We, we have dentists out there that are spending all this time and money. Where should I put my money? Put it in your practice, you know, and, and, and put it in things that you're good at and what you know, and the reward is huge. And then it gives them ability. The other thing is we talk about putting lipstick on the pig. And you know that lipstick, you know, it might cost you.

Maybe the 10, 20, $50,000, but the first two years is that national average is 8 to 12% return. Well, what can you put your money in to get those kind of returns this day and age? And, and then you think about. And that helps you boost to the next level and helps you get towards your dream. So you know, it's okay to do steps. And one of the biggest things in this day and age is we want instant gratification. They just slow down a little bit. And the biggest single mistake that I see new dentists coming out is they cripple themselves. And you know what that is?

The single biggest thing is they get that instant, that first check and go, wow, I've never seen this much money before. What do they do with it?

Yep, I know exactly where you're going with this. And it was one of the points that aligned so well with like our model is to stay frugal right in the beginning.

Absolutely. Drew is. And so what they do is they go buy the big house and they go buy the big car, but it cripples them. Because now all of a sudden what's interesting is then the lenders go, and so you don't have any money, you know, and you got this big debt. I'm not looking at. You already got school debt. Now what's interesting the other way around, you can have a half million dollars in school debt just so you keep paying that money and those regular payments and keep your FICA score up and do all those right things and work towards saving money. Don't, don't pay it off. Just show regular payments and then work towards saving the extra pay yourself and put money in the bank and try to save 40, $50,000. All of a sudden the lenders are coming to you and say how much you want? And what's interesting, if you do that, first there's some lenders that it doesn't even show up on your credit report. And then you could, you know, the next day or the next week you can go buy the fancy car. I have, I have a client right now that bought the big house and they knew they already owned the building and they were going to relocate their office into this new building and they spent $200,000 on the, down on the house that they didn't have to pay. But you know, they just wanted to be more financially responsible. Well, that financial responsible has killed the deal. Want to look at someone now? Isn't it interesting? Most people think, well the banks would love the idea that I put more money down so my debt's less. No, the bank more interested in consistency being a good payment, you know, and you take care of things, you don't walk away from things. You're, you're a stand up guy and you're always there for the long haul.

You outline this in your book and it's something that's in almost every one of our Associates on Fire modules, which is what is the hierarchy of cash flow needs in the beginning of what career? In the beginning, it's probably the most important time to follow and understand what that hierarchy is because it answers questions like when do I buy my home? Do I buy it before or after I buy my practice? When do I refinance my student loans over a shorter duration? And operating out of that order can really jeopardize their ability to attain the next item on the rung. I just find that this point is extra important. Important for new doctors to study and grasp as they start their career.

Yeah, and, and the visual I created in the book was I don't know if at the very end I talk about the fist of success. And so I thought what an analogy. And so literally I have doctors that don't realize it, that they really have their fists closed. And that's the perception that they're giving all these professionals, they're trying to bring in the, the lender and all these people, but really they have this barrier up they're putting. And so what's interesting is if they deal with the FICO score and have a good score of, you know, 720, if they have intelligent spending, they satisfy their passion, they're really passionate about what they do and not something else and they're not in it for the money and, and they take time for the relationships. You see what is happening with the hand is the. But the relationships not only for their family and the people that they've been working towards and wanting to build, but also more importantly is their. Not necessarily more importantly, but their patience and taking time for their patience and building that relationship because that's what's really going to feed their success.

Absolutely.

Savings. So all of a sudden you go from this to your hands open and that's where you're so powerfully successful and so powerfully accepted and it helps you catapult into the success module.

Very well said. Being open and willing to receive and accept change and then make the necessary course corrections, that's important. Steve, you have such a wealth of knowledge and we could talk for days and days without effort. But before we adjourn here, is there anything that you think is critical to share with our listeners?

You know, the biggest single thing is follow your passion and money will come. You know, take care of those around you and believe and support others and make a difference and everything, everything will come together. And dare I challenge you, dare to be who you are, not who your neighbor is, not who the guy across the street is, but dare to be unique in who you are.

More great wisdom. We appreciate that, Steve. Those are important concepts to define and revisit often. One last question for you Steve, before we go. If we have doctors listening to this today that would like to work with you and then co construction to build out the practice of their dreams. What parts of the country do you all provide services and how can they get in touch with you?

Thank you. Basically we specialize and I help anyone in the the state of Arizona and that's our boundaries and just primarily because there's such a variance. Even you know, in the Valley we have 23 municipalities and they all have different tweaks and it's even more so when you go into the extreme temperatures and, and different parts of the country and earthquake requirements, all kinds of stuff. So we serve best the area. We know every Arizona from the standpoint of the book, that's why I wrote the book, is to literally help dentists throughout the world make better choices. Because I can't help them all if they, if they want some helping consultations reach out to me. I'd be happy to talk to you. But I've helped quite a few dentists all around the country. Just sometimes it's just a phone call, sometimes it's just a quick review of their floor plan. And they're stumped. Sometimes it's just looking at things. But the bottom line is surround yourself with accountable professionals, and that's what the book will help you do. Because there's a lot of good professionals around the country. And I'm, I'm, there's people better than myself. You know, it's really, they're finding those people and asking the right questions.

Well, first, lucky for our listeners in Arizona. But second, not every area has a contractor that's focused only on dental with a tremendous track record, which is where Steve's book dentalease, can help a contractor in your area to bridge that knowledge gap quickly. And for everyone out there that is interested in learning more about Steve's book, Dental Ease, you can check it out@dental www.dreamdentalpractice.net. if you're in Arizona and you are in need of dental contracting services, or if you would like consulting help with the project that's out of state, or even if you're just curious to see Steve's impressive portfolio, you can navigate to his website at www.dencodental.com. that's-e n c o dental.com. thank you for joining us today, Steve. It was a pleasure to have you on the show. I hope we can run this one back in the future. And that wraps up another episode of the Associates on Fire podcast. Thanks for listening. If you like the show, help out our algorithm by following, liking and sharing across your favorite podcast platform. Until next time.