Jan 2011

Another year - New Challenges

By Alex Littlejohn

Another year has gone past in a flash. Snow problems galore. Postal problems by the millions. Transport grinds to a standstill. There is however one highway totally oblivious to the weather, doesn't rely on gritters, salt or snowploughs. Where is this unique phenomenon and how can we get on it? The answer is most of you already are.

The internet highway is increasingly part of all our lives and becoming more so as each year goes by. Digital information coming in to the laboratories in the snow chaos was only limited by the failure of patients to get to surgeries. The downside was that we were still relying on parcel companies to deliver the finished restorations. Nevertheless the new digital age at least kept some production ticking over.

I suspect in 2011 as the disruption of the weather fades more permanent problems will be more difficult to overcome. The increase in VAT on all our purchases. A squeeze on our prices as political financial pressures are placed on the profession who are all too ready to pass these on. The huge rise in the price of gold rapidly making it's use obsolete. The competition from the Far East and even the crazy prices on offer by some of our own labs distorting the markets. These are only some of the problems we will have to address in 2011.

Not a lot we can do about the VAT increases but pass these on in increased prices. All our materials, petrol and now postal charges all affecting our bottom line. Raising prices will be made all the more difficult as our dentist customers also come under the same economic pressures. Nevertheless we must bite the bullet if we are to survive. What seems the remarkable rise in the gold price when you look at it's historical value suggests it is not nearly at it's peak. Given that for the 35 year period up to 2005 the price per oz was around $400. It has spiralled since then but if you take the price over that 40 year period and add the inflation rate the price would be around $2500 per oz. Gold is steadily pricing itself out of the dental market especially now that we have more aesthetic and reliable alternatives.

I think the threat from the Far East will gradually diminish. As standards of living increase  in these countries so will the labour rates with which we cannot compete. Digitisation in our laboratories also allows us to compete on a more even playing field. There is perhaps more danger from the age old problem of laboratories themselves offering silly prices for restorations and distorting the market.

As we start the New Year all is not doom and gloom. The laboratory industry is driving the Technology revolution with new exciting and interesting developments nearly on a monthly basis. We all have our part to play to convince our customers that they should be offering their patients to have the modern treatment options which are now available.

Nearly always when the advantages of these are explained properly patients will opt for something better than the very basic. If anything will secure our future it will be changing our production systems and strategies to accommodate the new digital highway.

Have a prosperous and profitable 2011.