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How to Start a Dental Lab Business

Dental Lab Business

Do you want to start a dental lab business? If YES, here is a 20-step guide on how to start a dental lab with no money or experience.

Please note that if you intend to start this type of business, it is advisable to first look at the existing laws and zonal regulations in the country or state you reside in to know what is expected of you. You also need to pay a visit to the regulatory bodies in your country to get all the information you need before you can legally open your dental lab in your city.

You can start your dental lab business from a small town in the United States and if you are good at what you do when it comes to manufacturing efficient and reliable dental equipment and instrument, it won’t be too long before your brand becomes a nationally recognized brand.

Steps on How to Start a Dental Lab Business

  1. Understand the Industry

Dental laboratories manufacture or customize a variety of products to assist in the provision of oral healthcare by a licensed dentist.

These products include crowns, bridges, dentures and other dental products. Dental lab technicians follow a prescription from a licensed dentist when manufacturing these items, which include prosthetic devices (such as denture teeth and implants) and therapeutic devices (such as orthodontic devices).

The FDA regulates these products as medical devices and they are therefore subject to FDA’s good manufacturing practice (“GMP”) and quality system (“QS”) requirements. In most cases, however, they are exempt from manufacturer registration requirements.

Some of the most common restorations manufactured include crowns, bridges, dentures, and dental implants. Dental implants is one of the most advanced dental technologies in the field of dentistry. The Dental Laboratories industry is indeed a very large industry and pretty much thriving in developed countries such as United States of America, South Korea, United Kingdom, Germany, Japan and China et al.

Statistics has it that in the United States of America alone, there are about 9,650 licensed and registered dental laboratories responsible for directly employing about 44,048 employees and the industry rakes in a whooping sum of $5 billion annually with an annual growth rate projected at -1.0 percent 2016 and 2022.

It is important to state no establishment has more than 5 percent shares of this industry but the companies with the lion shares of the available market are Glidewell Dental Laboratories, DenMat Holdings LLC, National Dentex Corporation, and Modern Dental Laboratory USA LLC.

A recent research published by IBISWORLD show that Revenue for the Dental Laboratories industry has declined at an annualized rate of 0.1 percent to $4.9 billion over the five years to 2020. The industry experienced significant declines in revenue in 2015 and again in 2020 due to the COVID-19 (coronavirus) pandemic.

Early during the period, revenue was constrained due to a consolidating market, third-party payer challenges and increasingly commoditized dental services.

As a result, operators experienced new challenges despite innovative technological changes that expanded product offerings and improved efficiency. In 2020, industry revenue is expected to decrease 10.4 percent and the average industry profit margin, measured as earnings before interest and taxes, is projected to slip.

The report further states that over the five years to 2025, the Dental Laboratories industry is expected to make a gradual, if not steady, recovery in line with employment and consumer spending. Eventually, the administration of COVID-19 (coronavirus) vaccines will likely permit normal activity to resume, increasing demand for dental services, and thus, demand for dental laboratories.

Decreased unemployment will likely contribute to an increasingly insured population, which may increase access to dental insurance, and as a result, bolster industry demand and revenue.

Lastly, the dental laboratories industry is a thriving industry and some of the key drivers in this industry are the number of people with private health insurance, per capita disposable income, Federal funding for Medicare and Medicaid and of course the number of adults aged 65 and older.

  1. Conduct Market Research and Feasibility Studies

  • Demographics and Psychographics

The demographic and psychographic composition of those who make use of prosthetic devices (such as denture teeth and implants) and therapeutic devices (such as orthodontic devices) cuts across all dental clinics, school of dentistry and all medical clinics and hospitals that also treat dental concerns. In essence, the demographic composition for dental lab business is all encompassing.

  1. Decide Which Niche to Concentrate On

There is no niche area of specialization in the dental lab business since dental lab business is a niche area in the medical devices manufacturing industry.

Dental labs basically manufacture prosthetic devices (such as denture teeth and implants) and therapeutic devices (such as orthodontic devices) et al. Although some dental laboratories may decide to specialize in the manufacturing of any or all of the following;

  • Customized dentures
  • Customized crowns
  • Customized bridges
  • Customized orthodontic products
  • Inlays, onlays and veneers
The Level of Competition in the Industry

The competitions that exist in the dental lab business goes beyond competitions in your city; it is both national and international. This is so because, major dental laboratories can be contracted from any part of the United States or abroad especially in China where it can be manufactured at a cheap rate.

So, it will be right to say the competition in the dental lab business is high. The truth is that no matter the level of competition in an industry, if you have done your due diligence and you brand and promote your products or business properly, you will always make headway in the industry.

Just ensure you have what it takes to manufacture safe and easy to use prosthetic devices (such as denture teeth and implants) and therapeutic devices (such as orthodontic devices) et al, and you know how to reach out to your target market.

But over and above, there are several dental laboratories scattered all around the United States. So, if you choose to start your own dental lab business in the United States, you will definitely meet stiff competition. Besides, there are larger dental laboratories that determine the trends in the industry and you should be ready to compete with them for customers.

  1. Know Your Major Competitors in the Industry

Here are some of the most popular dental laboratories in the United States of America;

  • Glidewell Dental Laboratories
  • DenMat Holdings LLC
  • National Dentex Corporation
  • Modern Dental Laboratory USA LLC
  • Top-Dent Lab, Inc.
  • Iverson Dental Labs
  • Best Denture Dental Lab
  • Teeth Tomorrow Dental Lab
  • SK Dental Lab
  • Baran Dental Laboratory & Milling Center
  • Precision Dental Lab
  • Cornerstone Dental Labs
  • Global Dental Laboratories USA
  • Barksdale Dental Lab
  • Image Dental Laboratories | Milling Center.
Economic Analysis

If you are looking towards successfully launching a business and maximizing profits, then you need to ensure that you get your economic analysis right and try as much as possible to adopt best practices in the industry you choose to build a business in.

Dental lab business is no longer a green business, as a matter of fact, you will come across several brand names when you source for dental laboratories in your state. So, if you are mapping out your economic analysis, you should carry out thorough market survey and costing of the required production materials, branding and other running cost needed to successfully run the business.

So, if you are considering starting a dental lab business, your concern should not be limited to the cost of setting up the business and churning out quality dental products, but also on branding and on how to build a robust distribution network. The truth is that if you are able to build a robust distribution network, you are sure going to maximize profits in the business.

  1. Decide Whether to Buy a Franchise or Start from Scratch

Unfortunately, you can hardly find the franchise of a dental lab business to purchase meaning that if you want to own a dental lab business, then you must be ready to start from the scratch.

The truth is that it will pay you to start your dental lab business from the scratch. Starting from the scratch will afford you the opportunity to conduct thorough market survey and feasibility studies before choosing a location to launch the business.

Please note that most of the big and successful dental laboratories around started from the scratch and they were able to build a solid business brand. It takes dedication, hard work and determination to achieve business success.

  1. Know the Possible Threats and Challenges You Will Face

If you decide to start your own dental lab business today, one of the major challenges you are likely going to face is the presence of well – established dental laboratories whose products can be found all across the United States.

The only way to avoid this challenge is to create your own market perhaps by producing customized prosthetic devices (such as denture teeth and implants) and therapeutic devices (such as orthodontic devices). So also, an unexpected outbreak of pandemic can pose a great threat to you.

For example, during the recent Covid-19 pandemic, most states closed their dental practices except for emergency visits for a period of time. While many have resumed services, patient volumes and revenue remain far below pre-pandemic levels. As the main customer market for industry operators, this has had a highly significant effect on industry revenue.

  1. Choose the Most Suitable Legal Entity (LLC, C Corp, S Corp)

When considering starting a dental lab business, the legal entity you choose will go a long way to determine how big the business can grow; some dental laboratories design their business for regional market, some for national market and international market.

You have the option choosing a general partnership, limited liability company which is commonly called an LLC, or a sole proprietorship for your dental lab business. Ordinarily, sole proprietorship should have been the ideal business structure for a small – scale dental lab business especially if you are just starting out with a moderate startup capital.

But if your intention is to grow the business and manufacture dental fixtures for clients all across the United States of America and other countries of the world, then choosing sole proprietor is not an option for you. Limited Liability Company, LLC or even general partnership will cut it for you.

Setting up an LLC protects you from personal liability. If anything goes wrong in the business, it is only the money that you invested into the limited liability company that will be at risk. Limited liability companies are simpler and more flexible to operate and you don’t need a board of directors, shareholder meetings and other managerial formalities.

These are some of the factors you should consider before choosing a legal entity for your dental lab business; limitation of personal liability, ease of transferability, admission of new owners and investors’ expectation and of course taxes.

If you take your time to study the various legal entities to use for your dental lab business, you will agree that limited liability company; an LLC is most suitable. You can start this type of business as limited liability company (LLC) and in future convert it to a ‘C’ corporation or ‘S’ corporation especially when you have the plans of going public.

Upgrading to a ‘C’ corporation or ‘S’ corporation will give you the opportunity to grow your dental lab business so as to compete with major players in the industry; you will be able to generate capital from venture capital firms, you will enjoy separate tax structure, and you can easily transfer ownership of the company.

  1. Choose a Catchy Business Name from the Ideas Below

Normally, when it comes to choosing a name for your business, you should be creative because whatever name you choose for your business will go a long way to create a perception of what the business represents.

Typically, it is the norm for people to follow the trend in the industry they intend operating from when naming their business. If you are considering starting your own dental lab business, here are some catchy names that you can choose from;

  • Teeth Pro® Dental Laboratary, Inc.
  • Mary June® Dental Lab, LLC
  • Perfect Hedge® Dental Lab, Inc.
  • International Dentex Corporation, Inc.
  • Gary Grass® Dental Laboratory USA LLC.
  • Shannon Stev® Dental Lab, Inc.
  • Denver Porto® Dental Laboratory USA LLC
  • Instrument and More® Dental Lab, LLC
  • Cherry Wade® Dental Laboratory USA LLC
  • North River® Dental Laboratory USA LLC.
  1. Discuss With an Agent to Know the Best Insurance Policies for You

In the United States and in most countries of the world, you can’t operate a business without having some of the basic insurance policies that are required by the industry you want to operate from. Thus, it is imperative to create a budget for insurance and perhaps consult an insurance broker to guide you in choosing the best and most appropriate insurance policies for your business.

Here are some of the basic insurance policies that you should consider purchasing if you want to start your own dental lab business in the United States of America;

You can contact the following leading insurance companies in the United States of America to purchase insurance policies for your dental lab business;

  • Allstate Insurance Group
  • Liberty Mutual
  • Progressive Insurance Group (PGR)
  • Health Care Service Corporation (HCSC)
  • New York Life Insurance Company
  • Lincoln National Life Insurance Company
  • MassMutual (Massachusetts Mutual Life Insurance Company)
  • Northwestern Mutual Life Insurance Company
  1. Protect your Intellectual Property With Trademark, Copyrights, Patents

If you are considering starting your own dental lab business, usually you may not have any need to file for intellectual property protection/trademark because the nature of the business makes it possible for you to successfully run it without having any cause to challenge anybody in court for illegally making use of your company’s intellectual properties.

On the other hand, if you want to leverage on this business opportunities within the industry and also to protect your unique design, company’s logo and other documents or software that are unique to you or even operation concepts, then you can go ahead to file for intellectual property protection.

If you want to register your trademark, you are expected to begin the process by filing an application with the USPTO. The final approval of your trademark is subjected to the review of attorneys as required by USPTO.

  1. Get the Necessary Professional Certification

Please note that certification in the dental laboratory profession is strictly voluntary. Laboratories who have taken the extra steps to become certified represent the top of their field.

The most easily obtainable certification is the CDL (Certified Dental Laboratory). A Certified Dental Laboratory has met standards in personnel skill, training, infection control, tracking mechanisms and good business and manufacturing practices.

The certification is based on a third party review of photos of the facility. The next tier for certification is DAMAS (Dental Appliance Manufacturers Audit Scheme). DAMAS requires a third party on-site inspection. Based on international standards for the manufacturing of medical devices, the DAMAS certification ensures the lab environment operates in such a way as to ensure product and patient safety.

It provides a formula for improved documentation of many aspects of dental lab activity (from dental prescriptions to material traceability). DAMAS standards mirror the FDA’s quality system and good manufacturing practice standards, which all domestic dental laboratories must comply with.

The highest level of manufacturing certifications available to dental laboratories are through the ISO “International Organization for Standardization”. The ISO develops standards through the consensus of standards organizations from 161 countries.

Members represent both the public and private sectors of countries around the world. ISO standards are thought to represent the best interests and needs of the broader global society.

  1. Get the Necessary Legal Documents You Need to Operate

It is a fact that you cannot successfully run any business in the United States without the proper documentations. If you do, it won’t be long before the long hands of the law catch up with you. These are some of the basic legal documents that you are expected to have in place if you want to legally run your own business in the United States of America;

  1. Raise the Needed Startup Capital

Starting a standard, secured and well – equipped dental lab business is capital intensive even if you choose to launch the business on a small scale and you only have a handful of full time employees on your payroll.

Leasing of a standard facility that can accommodate your production machine, warehouse and staff and of course equipping the facility are part of what will consume a large chunk of your startup capital. In essence, if you choose to start the business on a small scale, you still need to source for fund to finance the business.

No doubt when it comes to financing a business, one of the first things you should consider is to write a good business plan. If you have a good and workable business plan document in place, you may not have to labor yourself before convincing your bank, investors and your friends to invest in your business. Here are some of the options you can explore when sourcing for startup capital for your dental lab business;

  • Raising money from personal savings and sale of personal stocks and properties
  • Raising money from investors and business partners
  • Sell shares to interested investors
  • Applying for loan from your bank
  • Pitching your business idea and applying for business grants and seed funding from, government, donor organizations and angel investors
  • Source for soft loans from your family members and your friends.
  1. Choose a Suitable Location for your Business

When it comes to choosing a location for your dental lab business, the rule of thumb is that you should be guided by the demand for such product and easy access to labor and raw materials in the location you so desire to start the business. Of course, if you are able to secure a central location for your dental lab business, it will enable you cut the cost of transporting your raw materials and finished products to and from your production facility and warehouse.

It cannot be overemphasized that the location you chose to open your dental lab business is key to the success of the business, hence entrepreneurs are willing to rent or lease a facility in a visible location; a location where the demography consist of dental clinics, school of dentistry and all medical clinics and hospitals that also treat dental concerns.

If you make the mistake of renting or leasing a facility for your dental lab business in a not too visible or hidden location simply because it is cheap, then you must be prepared to spend more in promoting the business and perhaps giving direction to potential clients.

It is important to note that a business facility in good location does not come cheap hence you should be able to allocate enough fund for leasing/renting in your budget. If you are new to the dynamics of choosing a location for your dental lab business, then you should feel free to talk to a business consultant or a realtor who has a full grasp of the city and perhaps country you intend starting your business.

Most importantly, before choosing a location for your dental lab business, ensure that you first conduct a thorough feasibility studies and market survey. The possibility of you coming across similar business that just closed shop in the location you want to open yours can’t be ruled out.

Which is why it is very important to gather as much facts and figures before choosing a location to set – up your own dental lab business. Having said that, these are some of the cities in the United States of America where you can locate your dental lab business;

  • Brattleboro, Vermont
  • Tucson, Arizona
  • Silver Spring, Maryland
  • Rowland Heights, California
  • Portland, Oregon
  • Richmond, Virginia
  • Green Bay, Wisconsin
  • Plano, Texas
  1. Hire Employees for your Technical and Manpower Needs

If you are considering setting up a dental lab business, it means that you should be prepared to set a standard production factory. If you don’t have enough cash, you can start with fairly used production machines, but if you are financially buoyant, then you should go for brand new ones since they usually have a long – life span.

As regards leasing or outright purchase of a production or warehouse facility, the choice is dependent on your financial standings, but the truth is that to be on the safe side, it is advisable to start off with a short-term rent/lease while test running the business in the location.

If things work out as planned, then you go on a long – term lease or outright purchase of the property but if not, then move on and source for other ideal location / facility for such business.

When it comes to hiring employees for a standard dental lab business, you should make plans to hire a competent Chief Executive Officer (you can occupy this role), Admin and Human Resources Manager, Production Engineers, Sales and Marketing Manager, Product Designers, Quality Control Officer, Accountant, Production Plant Workers, Distribution/Delivery Truck Drivers and Client Services Executive.

On the average, you will need a minimum of 10 to 20 key staff members to run a small – scale but standard dental lab business.

The Service Delivery Process of the Business

When it comes to the manufacturing of prosthetic devices (such as denture teeth and implants) and therapeutic devices (such as orthodontic devices), the first step to take is to come up with a design and then have the design approved by your team.

The next step is to determine the quantity of materials that are to be used and the number and types of dental products that are to be produced per time. Other steps involved include cutting the materials to size, join all the parts and assembling of all the component parts.

The products will be subjected to testing and quality control before they are released to the market. They must meet the ISO “International Organization for Standardization” Standard. ISO 9001 is a set of standards for quality management systems.

ISO 13485 is a set of standards, published in 2003, that represents the requirements for a comprehensive management system for the design and manufacture of medical devices. It emphasizes meeting regulatory requirements and managing risk in order to ensure the production of safe design and distribution of medical devices.

It is important to state that a dental lab business may decide to improvise or adopt any business process and structure that will guarantee them efficiency and flexibility; the above stated dental lab business process is not cast on stone.

  1. Write a Marketing Plan Packed With ideas & Strategies

Running a business requires that you should be proactive when it comes to marketing your goods or services. If you choose to launch a dental lab business, then you must go all out to employ strategies that will help you attract customers or else you will likely struggle with the business because there are well – known brands that determine the market direction for dental laboratories.

Your marketing strategy should center on quality and pricing, and above all excellent customer service. The truth is that, if you are able to put the above stated in place, you won’t struggle to retain your old customers and at the same time win over new customers.

So, when you are drafting your marketing plans, make sure that you create a compelling company profile. Aside from your qualifications and experience, it is important to clearly state what you have been able to achieve in time past. This will help boost your chances in the market place when marketing your dental products.

Here are some of the platforms you can utilize to market your dental lab business;

  • Introduce your dental lab business by sending introductory letters alongside your brochure to dental clinics, school of dentistry and all medical clinics and hospitals that also treat dental concerns and key stake holders throughout the United States and Canada.
  • Advertise on the internet on blogs and forums, and also on social media like Twitter, Facebook, LinkedIn to get your message across
  • Creating a basic website for your business so as to give your business an online presence
  • Directly market your dental products.
  • Join local dental laboratories associations for industry trends and tips
  • Advertise our business in community based newspapers, local TV and radio stations
  • List your business on yellow pages ads (local directories)
  • Encourage the use of word of mouth marketing (referrals)
  1. Work Out a Reasonable Pricing for your Services & Products

One key factor that will help you sell your dental products at rock bottom prices is to purchase your raw materials and supplies directly from wholesalers in pretty large quantities. The truth is the higher the quantity of items that you purchase directly from wholesalers, the cheaper you tend to get them.

You can also try as much as possible to automate your production facility and also work with independent contractors and marketers; it will help you save cost for paying sales and marketing executives. So also, if you are able to secure business partnership as it relates to getting referrals, then you will be able to get the right pricing and of course maximize profits from your business.

  1. Develop Iron-clad Competitive Strategies to Help You Win

The dental lab business is not a competitive industry, but you must come up with a unique and highly creative strategies to be able to outsmart your competitors in the industry. Part of what you need to do in order to stay competitive in the industry is to ensure that your dental products are well designed to fit with the trends and safety must also be your guiding principle.

In other to stay competitive in this industry, you must ensure that your clients are always comfortable when making use of your dental products and always ensure that you pay attention to details when carrying out your job. The truth is that if there are fluctuations in the quality of your products, customers can choose to shift allegiance and settle for other options available.

  1. Brainstorm Possible Ways to Retain Clients & Customers

When it comes to business, no matter the industry that you choose to pitch your tent in, one of the easiest ways to increase customer retention and perhaps attract new customers is to produce results and satisfy your customers always.

If your customers are satisfied with your products and service delivery, they can hardly source for alternative service providers. If your services and customer service fluctuate, you are likely going to struggle to get your customers coming back to purchase your products or services. Ensure that you offer your customers incentives if you want to retain them and of course continue to generate repeated sales from them and also to attract new customers.

Part of what you need to do to achieve this is to track progress, results or outputs with the aim of improving on them quickly as the case demands. When it comes to managing your customers and building a loyal clientele base, you should purchase a customized CRM software.

With a customized CRM system, you can easily stay in touch with your clients (you can carry out quick surveys, you can introduce new products and prices to them without any hitch, you can felicitate with them on their birthdays and other anniversaries, you can keep track of their progress, you can send bulk sms and customized e – mails and above all, you can easily receive complaints and feedback from them).

  1. Develop Strategies to Boost Brand Awareness and Create a Corporate Identity

If you are in business and you are not conscious about boosting you brand awareness and communicating your corporate identity, then you should be ready to take on whatever the society portray your business to be.

One of the secrets of larger corporations is that they are willing to spend fortunes year in and year out to boost their brand awareness and to continue to communicate their corporate identity the way they want people to perceive them to be.

No matter the industry you belong to, the truth is that the market is dynamic and it requires consistent brand awareness and brand boosting cum promotion to continue to appeal to your target market. Here are the platforms you can leverage on to boost your brand and create a corporate identity for your dental lab business;

  • Place adverts on both print (newspapers and health magazines) and electronic media platforms
  • Sponsor relevant community – based events
  • Leverage on the internet and social media platforms like; Instagram, Facebook, Twitter, YouTube, Google + et al to promote your dental products
  • Install your billboards in strategic locations all around your city or state
  • Distribute your fliers and handbills in target areas
  • List your dental lab business in local directories/yellow pages
  • Advertise your dental lab business in your official website and employ strategies that will help you pull traffic to the site
  • Position your Flexi Banners at strategic positions in the location where your dental lab business is located.
  • Ensure that all your staff members wear your branded shirts and all your vehicles are branded with your company logo.