Increase Profitability
Like every other business in the western world, dentistry should return a profit. Unfortunately, many practitioners labor under the mistaken idea that any money that is paid the doctor throughout the year is profit. If the doctor were to invest in a publicly held stock, there would be an idea of a Return On Investment (ROI) for the risk of owning the stock.
This return will come either in price accumulation of shares or a dividend payment somewhat regularly. Of course there are no publically traded shares of dental office stock, but the doctor must anticipate a ROI if the business is to prosper. If the doctor owned 3M stock and showed up to work there as well, there would be an expectation of making money in the way of a salary for time invested as well as making money from owning the stock.
This is exactly what the doctor has done. He/she shows up at the office ready to deliver wonderful care and expects to be paid for this action. But what about the return on the capital that is tied up in the office, which could alternatively be invested elsewhere, say a flower shop or travel agency? There are times when that would actually be a better place for the investment than in the dental office. SEE MORE
