The age of small dental laboratories
My partner and I started our lab in a basement more than 30 years ago. It was just the two of us, and our business model privileged quality over volume. The prevailing attitude at the time was: the larger the lab, the more frequently quality would be sacrificed.
I will never forget a particular incident that happened when we were still in that basement. One of our first accounts loved our work, but he would never refer his colleagues to us because he didn’t want us to get “too big.” He stopped sending us work when we grew from a two-person lab to an eight-person lab. Even though the quality of our work was maintained (dental lab supplies online), his perception of our size drove him away. That dentist is probably having a difficult time finding a lab these days.
The age of larger dental laboratories
The labs that are able to remain in business have grown to become midsized (like mine) or large-scale. Hiring more technicians and investing in sophisticated equipment allows us to increase production and keep costs competitive; however, the challenge that we all face is maintaining quality.
Imagine the fabrication of your crown being reduced to an assembly line of technicians, each doing one part of a multiple-step procedure. Imagine dipping dies all day while the next person waxes, followed by the next person who waxes the margins, then the next one who sprues, and so on.
The lure of offshore
Offshoring is double jeopardy. The work is sent overseas, most commonly to China, where labs may employ up to 1,500 technicians in one factory. We now have the large, corporate assembly line, as well as concerns about foreign-made products. FDA, ADA, HIPAA, and OSHA regulations do not apply there; therefore, we have no guarantee that approved materials are being used.
Just like in your dental practice, my biggest expense is labor. I take pride in the handcrafted work we produce, similarly to how you are proud of the dental team you have assembled. But that means we have to pay salary, overtime, vacation, medical, social security, state taxes, unemployment, and so forth.
Technology to the rescue
Digital dentistry has arguably been the biggest advancement in years for both dental labs and practices. Digital scanning in-office can reduce overhead and expedite procedures. We have seen previous systems that only resulted in milled or printed models and that still required hand-waxed crowns, but the latest generation enables the digital design and production of restorations that can be fit and adjusted on a final model or produced without a model.
The future of dental laboratories
Small labs, staffed by five people or fewer, will likely be unable to purchase the necessary traditional products or new technology and will certainly not be able to compete financially with the larger labs. These smaller, quality labs will probably close due to inability to compete.
The midsized and larger quality labs will be able to carry on, but getting new labor and affording the continuous upgrades to technology and training will be very costly. Deciding to be “bought out” by allowing a larger entity to finance the business and supply the merchandise will necessarily be attractive.
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