Thursday, March 11, 2010

In-House Lab

I am almost done with Three Cups of Tea. It is a remarkable story.
I will tell you about it when I am done.

I watched a couple of old movies this week. I decided to watch Full Metal Jacket. And I saw a movie called The Edge. They were both very good movies.

The Magic are front and center around here these days.
They are on a real tear since the All-Star break.
They played the Lakers and won on Sunday.
One of the big stories is this guy that we have on our team, Matt Barnes, was pushing and shoving Kobe Bryant all night.
Now Matt Barnes brings something to the Magic that we haven't had I think ever.
So I am reading in the paper about this journeyman (this is something you call someone who has gone from team to team. He has been on 7 teams in 8 years). Orlando really likes this guy and according to this article he really likes Orlando (you always have to say this when you are talking about getting another contract, "I love this city and I would love to stay here").
Turns out Matt makes $1.8 million.
Now to an NBA player that is disrespectful. This is chump change for someone on our team.
I started thinking. This guy plays a game for a living. Man that would be cool. He wakes up at about 9am and goes to the gym. He gets taped up. Plays basketball for 3 hours. Gets a massage. Does some more shooting (he is still looking to get more money).
He gets on a pimped out plane and goes to a major city. He checks into the Ritz-Carlton and has nothing to do until the next morning. He can go for a workout. He can go eat at Smith and Wollensky for dinner in the private room.
He then goes to sleep. He wakes up at about 10am and goes and plays basketball.
And at the end of the WEEK he gets a check for $35,000. That doesn't sound like disrespect to me.
Now I thought this was amazing. Amazing because in 2007 the nation average income was around $48,000. YEARLY
But what was amazing was that Vince Carter, another player on our team, gets $16 million a year. At the end of this hard WEEK he gets a check for $308,000.
Three hundred thousand dollars a week. This is just crazy to think about.

Man I knew I should have played basketball after school instead of studying.
Oh and they are thinking there might be a stoppage of play next year because the players and owners are arguing about money.


One thing I forgot to talk to you about was a nugget I picked up at the Bill Strupp.
He talked about having an in-house lab.
And it got me thinking.
Here is how he breaks it down.
Cost of equipment...per year: $25K
Technician...per year: $60K
All his numbers are based on doing 600 units a year.
Wait a minute. I am reading this again and this number sounds a little high to me.
I don't know how many units I do. I have told you before I don't look at that stuff.

So, to get more informed, I called my technician and asked him if he knew how many units I did last year. Of course he knew or he had it on his software.
Here is the breakdown.
I did 127 units last year.
That is not very much. I have to tell you that I was one of the lowest in his lab.
(for the record, I pride myself on being conservative and I am happy I am the lowest).

I went ahead and asked him about his other accounts because dentists want to know where they stand up to others.
There was a guy who I really like who is on the other side of town...he did 297. Holy Shnikeys
that is a lot. Man that is more than double my number.
The most from a dentist in his lab...360. WOW!!!

I want to go back to Dr. Strupp's example of having an in-house lab.
So he goes on to say that if you do 50 units a month (for him that is only one case a week).
You add up the equipment cost and salary of the technician and you get $85,000.
$85,000 divided by the units 600, and you get $142 per unit.

Then he goes on to say how much more efficient we will be.
We no longer have to communicate with our technician by other means. We would not have to bring in the technician for a shade match or other stuff.
So he thinks this will increase our production by 25%.
So this will add $25,000 to our production.
While I am typing this blog I am referring to his hand-out notes.
I am with him so far but the next line says
"$25,000 divided by 600 = $42 per unit.
And he goes on to say that if you only do 25 unit a month you are only paying $84 per unit.

I can't figure out his math, but 25 units a month...that might be doable.
It think between my father and I, we may do something around that.

Then the very next week after the Strupp seminar my dad was doing work on his best friend who is a dentist. And that dentist wanted a CERAC restoration. So they arranged it so the representative would come and bring a CERAC machine. So my father did a couple and the salesperson was at her best.
I mean she was using all the lines, like when my father asked how much it costs she responded, "Well it is free. Yeah because it is going to make you so much money it really won't cost you anything." By the way the real answer is $119,000.
And my father, who I love like crazy, is kind of gullible. Man did he want to get this thing.
And I had to to say, "Hold on there cowboy."
You all know how I feel about CERAC (and it hasn't changed), and if you don't then you are going to have to look some old posts.

So we have never talked about lab stuff really on this blog.
Like other things in my office, I don't look at my lab bill. Here is my thing...I like my lab. I think he is very, very good at what he does. I think he is up to date on all the stuff that goes on in the world of lab stuff. I think he would tell me if there was something I could improve on. I trust him.
Why would I be concerned if he was charging me $185 for a crown or $225? I charge $1150-1250 for a crown. My margin on the crown is not going to be changed if he raises his fees up $5 a unit.
So I don't check it. Also knowing all the things I know from above, I don't want money to get in the way of our great personal and professional relationship. And I think he trusts me. I mean he and his family are patients here.
The only way I would check the bill is to see if he charged me for a remake or something like that. I would never read his bill and say, "Man this guy is really pinching me."
Truthfully, I talked to him about a bill about once a year.

I know I have written some long blogs this week so I am going to end this one and pick it back up on Wednesday.
I want to talk about our choices.
We can keep things the way they are.
We can hire an in-house lab the Stupp way.
We could buy a CERAC machine.
But one thing I thought about was buying a lab. I started thinking...If the CERAC machine costs $119,000, shoot how much would it cost to just buy a laboratory? I can't be that much.
How about going in with a couple of other dentists and purchasing our lab guy's business.
I am not going to say anything else.
All I know is that if I made NBA money, I wouldn't be having any of these problems. Damn.

I want you guys to marinate on this for the next couple of days and then we will talk about it.
If you have something to say now throw in a comment.
If you have an in-house lab, you have to tell us about it.
If you own a lab you, have to tell us about it.

Now you think about that,
Have a great weekend,


Anonymous said...

The problem with most good labs is that once the lab tech gets good enough they leave and open their own lab. For me consistency was always a problem due to tech turn over. In the future labs will be like the post office is with email. Their role will be greatly diminished due to CAD CAM. They, the labs are putting themselves out off business by embracing this monolith all porcelain crown crap that is being pushed right now. Because they are so lazy to layer the porcelain all they do is have white block tooth made by the CAD CAM and paint it. It won't take much for the CAD CAM to get the shade better than the crap they are doing now. Right now I can get a PFM done cheaper and better than a CAD CAM crown. But as time goes by with the help of the lab the CAD CAM will be cheaper and better like email is now versus the post office. Also the sad part is the art of crown and bridge will be lost just like the art of letter writing is being lost. So in my opinion unless you can crank 600 units like Strupp a lab is not worth it for you to by and the CAD CAM tech is not ready for main stream yet. But it will be in a few years.

Anonymous said...

It really irritates me when I see these major league players go on strike or threaten to. The best is when they hold out to get better deal when the already have a contract. As you said they get paid to play a game.

Anonymous said...

I hear you my brother (or sister),
"I know I signed a contract but I want more and I want it now or I won't I can go out and buy my Porsche Carrera Turbo Convertible (inside joke, if you don't get this please see last weeks blog)



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