Dental laboratories manufacture or customize a variety of products to assist in the provision of oral health care 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.
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.
Statistics have it that in the United States of America alone, there are about 9,650 licensed and registered dental laboratories. The industry is 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 in 2016 and 2022.
Steps on How to Start a Dental Lab Business in 2022
Table of Content
1. Conduct Market Research
The first step in the market research process is to develop a market-based research question in line with your overall business goal and objective. In this regard, you should source information that will help you maximize your business, information that will help you know what your potential market is looking for from a dental lab, and that will help you operate your dental lab with less stress.
a. Who is the Target Market for a Dental Lab?
- Medical laboratories
- Medical colleges
- Dental clinics
b. Is Dental Lab a Profitable Business?
Yes, the dental lab business is a profitable business and statistics show that the industry generates an average of $5 billion annually.
c. Are There Existing Niches in the Industry?
Though there is no niche area in the dental lab business, it is common for some dental labs to specialize in any of the following;
- Manufacturing customized dentures
- Manufacturing customized crowns
- Manufacturing customized bridges
- Manufacturing customized orthodontic products
- Inlays, Onlays, and veneers
d. Who are the Major Competitors?
- 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.
e. Are There County or State Regulations or Zoning Laws for Dental Lab?
Yes, there are county or state regulations and zoning laws for dental labs, and players in this industry are expected to work with the existing regulations governing such business in the county or state where their business is domiciled.
In addition to that, it is important to state that the U.S. Food and Drug Administration requires registration for dental labs that operate overseas, serve as the initial importer for a foreign laboratory, conduct repackaging services, or manufacture sleep apnea/snoring and other specific orthodontic appliances.
f. Is There a Franchise for Dental Lab Business?
No, there are no known franchise opportunities for the dental lab business.
g. What Do You Need to Start a Dental Lab?
- A Feasibility Report
- Business and Marketing Plans
- Business Licenses and Permits
- A Good Lab facility
- Computers, Laptops, and Servers
- EIN (Employer Identification Number)/Federal Tax ID Number.
- A Corporate Bank Account
- Dental Equipment and Tools
- Startup Capital
Memorable Business Name ideas for Dental Lab
- Tony Lords© Dental Laboratory, Inc.
- Andy Jonathan® Dental Laboratory, LLC
- Rex Brown© Dental Laboratory, Inc.
- Dental Solutions® Dental Laboratory, Inc.
- Dental Expats™ Dental Laboratory, Inc.
- Jade Jason™ Dental Laboratory, LLC.
- Drill Blaze© Dental Laboratory, LLC
- Lara Williams® Dental Laboratory, Inc.
- Dental Pros© Dental Laboratory, Inc.
- Gaius Luke© Dental Laboratory, Inc.
- Teeth Pro® Dental Laboratory, 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.
Register Your Business
a. What Type of Business Structure is Best for Dental Lab?
Even though there are several options when it comes to the business structure of a dental lab business, the one that most players in this line of business consider is LLC. It is common to consider LLC because providers want to protect themselves from lawsuits.
Please note that an LLC will need an EIN if it has any employees or if it will be required to file any of the excise tax forms listed below. Most new single-member LLCs classified as disregarded entities will need to obtain an EIN.
b. Steps to Form an LLC
- Choose a Name for Your LLC.
- File Articles of Organization.
- Choose a registered agent.
- Decide on member vs. manager management.
- Create an LLC operating agreement.
- Comply with other tax and regulatory requirements.
- File annual reports.
c. What Type of License is Needed to Open a Dental Lab?
- General Business License
- Health and Safety Permit
- Zonal Permits (Applicable in some cities)
- Signage Permit
- Operational State Facility Inspections
d. What Type of Certification is Needed to Open a Dental Lab?
These are some of the certifications you can work towards achieving if you want to run a dental lab business;
- The CDL (Certified Dental Laboratory)
- DAMAS (Dental Appliance Manufacturers Audit Scheme).
e. What Documents are Needed to Open a Dental Lab?
These are some of the basic legal documents you are expected to have if you want to legally run a dental lab business in the United States of America;
- Business and liability insurance
- Federal Tax Payer’s ID
- State Permit and Building Approval
- Certificate of Incorporation
- Business License
- Business Plan
- Employment Agreement (offer letters)
- Operating Agreement for LLCs
- Insurance Policy
- Contract Document
- Company Bylaws
- Memorandum of Understanding (MoU)
f. Do You Need a Trademark, Copyright, or Patent?
If you are considering starting a dental lab business, you will need to file for intellectual property protection or trademark. This is because dental laboratories manufacture or customize a variety of products.
Cost Analysis and Budgeting
a. How Much Does It Cost to Start a Dental Lab Business?
When it comes to starting a dental lab business, the startup costs could range from $25,000 to over $250,000 depending on how much equipment the business owner decides to purchase and the lab space leased. Please note that this amount includes the salaries of all the staff for the first month of operation.
b. What are the Costs Involved in Starting a Dental Lab Business?
- The total fee for registering the business in the United States of America – $750.
- Legal expenses for obtaining licenses and permits as well as the accounting services (software, P.O.S machines, and other software) – $3,300.
- Marketing promotion expenses – $3,500, and as well as flyer printing (2,000 flyers at $0.04 per copy) for the total amount of $3,580.
- The cost for hiring a business consultant – $2,500.
- Insurance (general liability, workers’ compensation, and property-casualty) coverage at a total premium – $2,400.
- The cost for payment of rent for 12 months at $1.76 per square foot in the total amount of $75,600.
- The cost for laboratory remodeling (construction of racks and shelves) – $10,000.
- Other start-up expenses including phone and utility deposits ($2,500).
- Operational cost for the first 3 months (salaries of employees, payments of bills et al) – $30,000
- The cost for start-up inventory (toolbox and equipment)) – $50,000
- The cost for store equipment (cash register, security, ventilation, signage) – $13,750
- The cost of purchase and installation of CCTVs: $3,000
- The cost for the purchase of office furniture and gadgets (Computers, Printers, Telephone, TVs, Sound System, tables and chairs et al): $4,000.
- The cost of launching a website: $600
- Miscellaneous: $5,000
c. What Factors Determine the Cost of Opening a Dental Lab Business?
- The size of the dental lab business
- The choice of location
- The required licenses and permits
- The type of facility
- Additional service offerings
- The cost of hiring and paying a business consultant and attorney
- The cost for branding, promotion, and marketing of the dental lab
- The cost for furnishing and equipping the facility
- The cost for insurance policy covers
- The cost for registering the business
- Source of your supplies and ongoing expenses
- Cost of recruiting and training your staff
- The cost for the purchase and customizing of uniforms, shoes, and caps for your employees
d. Do You Need to Build a Facility? If YES, How Much Will It Cost?
It is not compulsory to build a new facility for your dental lab, but if you have the required finance, it will pay you to build your facility. The truth is that building or reconstructing a facility will help you come up with an edifice that suits your needs.
e. What are the Ongoing Expenses of a Dental Lab Business?
- Supplies – prosthetic devices (such as denture teeth and implants), therapeutic devices (such as orthodontic devices), orthodontic lab materials (orthodontic acrylic additives, orthodontic acrylic resins), and removable materials (denture acrylic primers, denture acrylic resins, denture repair acrylic resins, denture teeth, liquid foil materials).
- Utility bills – (internet subscriptions, phone bills, signage and software renewal fees et al)
- Salaries of employees
f. What is the Average Salary of your Staff?
- Chief Executive Officer (President) – $65,000 Per Year
- Lead Dental Lab Scientists (Lab Manager) – $45,000 Per Year
- Human Resources and Admin Manager – $42,000 Per Year
- Sales and Marketing Executive – $30,000 Per Year
- Accountant – $32,000 Per Year
- Dental Laboratory Technologists and Scientist – $36,100 Per Year
- Client Service Executive (Help Desk Office) -$28,000 Per Year
g. How Do You Get Funding to Start a Dental Lab Business
- Raise money from personal savings and sale of personal stocks and properties
- Raise money from investors and business partners
- Sell shares to interested investors
- Apply for a loan from your bank/banks
- Apply for business grants and seed funding from the government, donor organizations, and angel investors
- Source for soft loans from your family members and your friends.
Write a Business Plan
a. Executive Summary
Our Dental Laboratory is a standard, licensed, and certified dental laboratory that will be located in the heart of Westchester County, New York – United States of America. We are in the dental laboratory business to deliver excellent dental laboratory-related services. Our employees are well trained and qualified to handle our dental care services.
We are in the industry to manufacture dentures, crowns, bridges, and orthodontic products such as Implants, Inlays, Onlays, and veneers customized for individual application, and also to provide support services for dental clinics. We are well trained and equipped to service the market segments that require our services.
b. Products and Service
- Manufacturing customized dentures
- Manufacturing customized crowns
- Manufacturing customized bridges
- Manufacturing customized orthodontic products such as Implants, Inlays, Onlays, and veneers
c. Mission Statement
Our mission is to establish a world-class dental laboratory that will be involved in the manufacturing of quality dentures, crowns, bridges, and orthodontic products at affordable prices to dental clinics and medical facilities in Westchester County – New York, and other key cities in the United States of America where we intend opening of offices.
Our vision is to become one of the leading brands in the dental laboratory business in New York and to establish a one-stop dental laboratory in Westchester County – New York and other key cities in the United States of America.
b. Goals and Objectives
The goals and objectives of the dental lab business are to manufacture dentures, crowns, bridges, and orthodontic products customized for individual application as prescribed by licensed dentists and also to provide support services for dental clinics.
c. Organizational Structure
- Chief Executive Officer (President)
- Lead Dental Lab Scientists (Lab Manager)
- Human Resources and Admin Manager
- Dental Laboratory Technologists and Scientist
- Sales and Marketing Executive
- Dental Laboratory Technologists and Scientist
- Client Service Executive (Help Desk Office)
a. SWOT Analysis
The strength of the dental lab business is that we have experienced and certified dental lab technicians under our payroll. We also operate in a location where we can easily collaborate with other key stakeholders in the dental industry.
As a new dental lab business, it might take some time for our organization to break into the market and gain acceptance especially from top profile clients in the fast-growing dental industry; that is perhaps our major weakness. Another weakness is that we don’t have the financial capacity to compete with multi-million dollar dental laboratories when it comes to working for a wide range of high-paying clients.
The rising elderly population will drive demand for dentures, bolstering industry revenue. Again, strong demand for affordable and esthetic dental restorative solutions will drive industry growth. The fact that we are going to be operating our dental laboratory close to the largest dental clinic in Westchester County – New York provides us with unlimited opportunities to offer our services to a large number of clients.
Improving technology which ultimately will lead to the durability of dental laboratory products and will pose a threat to our business. This is because it will lead to the durability of dental laboratory products. This is why dental practitioners should aim at maximizing revenue through the use of evolving technologies. Another threat that may likely confront us is the arrival of a new dental laboratory outlet in the same location where ours is located. Unfavorable government policies can also pose a threat to our business.
b. How Do Dental Labs Make Money?
Dental labs make money by offering the following products;
- Manufacturing and sale of customized dentures
- Manufacturing and sale of customized crowns
- Manufacturing and sale of customized bridges
- Manufacturing and sale of customized orthodontic products such as Implants, Inlays, Onlays, and veneers
c. Payment Options
- Payment via bank transfer
- Payment via credit cards
- Payment via online bank transfer
- Payment via check
- Payment via mobile money transfer
- Payment via bank draft
d. Sales & Advertising Strategies
- Introduce your dental lab business by sending introductory letters alongside your brochure to dental clinics, schools of dentistry, all medical clinics and hospitals, and key stakeholders
- Advertise on the internet on blogs and forums, and also on social media like Twitter, Facebook, LinkedIn to get your message across
- Create a basic website for your business 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)
a. How Much Should You Charge for your Product/Service?
The amount to charge for your dental lab products and services should depend on some factors. For example, Inlays usually cost between $250 – $1,500. Outlays usually cost between $350 – $1,500. The cost will depend on how many areas are being treated, the size of the areas treated, and the material chosen for the inlay or Onlay.
So also, dental veneers range in cost from as low as $400 to as high as $2,500 per tooth. Composite veneers are the least expensive veneer option, generally ranging from $400-$1,500 per tooth, whereas porcelain veneers generally cost between $925 to $2,500 per tooth.
b. How Much Profit Do Dental Lab Business Owners Make a Year?
It depends, but available reports show that Blue Diamond Dental Lab Owner earns $75,000 annually, or $36 per hour, which is 7 percent higher than the national average for all owners at $70,000 annually and 13 percent higher than the national salary average for all working Americans.
c. What Factors Determine the Amount of Profit to Be Made?
- The capacity of the dental lab business
- The types of customized services and products offerings
- The location of the dental lab business is covering
- The management style of the dental lab business
- The business approach of the dental lab business
- The advertising and marketing strategies adopted by the dental lab business.
- The number of years the dental lab is in business
d. What is the Profit Margin of a Dental Lab Business?
The profit margin of a dental lab business is not fixed; to a large extent, it will depend on some factors that are unique to your location. It can range from 35 percent to 70 percent depending on the nature of the products and services in question.
e. What is the Sales Forecast?
Below is the sales forecast for a Dental Lab Business based on the location of the business and other factors as it relates to such startups in the United States;
First Fiscal Year:
- $100,000 (From Self – Pay Clients)
- $150,000 (From Medicaid Covers)
Second Fiscal Year
- $150,000 (From Self – Pay Clients)
- $200,000 (From Medicaid Covers)
- $200,000 (From Self – Pay Clients)
- $250,000 (From Medicaid Cover)
Set Up your Shop/Office
a. How Do You Choose a Perfect Location for a Dental Lab Business?
- The demography of the location especially as it relates to clinics that make use of products from dental labs
- The demand for the services and products offered by dental labs in the location
- The purchasing power of businesses and residents of the location
- Accessibility of the location
- The number of dental labs, dental clinics, hospitals, and medical healthcare facilities in the location
- The local laws and regulations in the community/state
- Traffic, parking and security et al
b. What State and City are Best to Open a Dental Lab Business?
- Brattleboro, Vermont
- Tucson, Arizona
- Silver Spring, Maryland
- Rowland Heights, California
- Portland, Oregon
- Richmond, Virginia
- Green Bay, Wisconsin
- Plano, Texas
c. What Equipment is Needed to Operate a Dental Lab Business?
You should be prepared to purchase Pneumatic Chisels, Model Saws, Model Trimmers, Dental Organic Solvent, Surfactant Sprays, Vacuum Mixers, Dental Vibrators, and Denture Reline. You will also need computers and laptops, internet facility, telephone, fax machine, and office furniture (chairs, tables, and shelves), and all these can be gotten as fairly used.
When it comes to hiring employees for a standard dental lab business, you should make plans to hire a competent Chief Executive Officer (President), Lead Dental Lab Scientists (Manager), Human Resources and Admin Manager, Sales and Marketing Executive, Accountant, Dental Laboratory Technologists, and Scientist and Client Service Executive (Help Desk Office).
Launch the Business Proper
No dental lab business opens its door for business without first organizing an opening party to officially launch the business. You can choose to do a soft opening if you are operating on a low budget or you can go for a grand opening party. The bottom line is that with a proper launching of the dental lab business, you will be able to officially inform people in your city that your dental lab business is open for business.
a. What Makes a Dental Lab Business Successful?
- If you are in a business partnership with the major dental clinics, hospitals, and major suppliers of dental lab products
- If you are generating profits from the business
- If your customers are happy and satisfied with your products and services and they are freely recommending your services to their friends, family members, and business partners.
- If your employees are happy and satisfied with the organization.
b. What Happens During a Typical Day at a Dental Lab Business?
- The office is open for the day’s work
- The to-do list is reviewed
- Employees go straight to their job description (productions, testing, and packaging of dental products)
- Deliveries of orders are made
- Reports are written and submitted to superior officers
- The business is closed for the day.
c. What Skills and Experience Do You Need to Build a Dental Lab Business?
- Excellent computer and technical skills
- Good managerial and human development skills
- Team-building & Interpersonal Skills.
- Excellent communication and negotiation skills.
- Organizational skills.
- Manual dexterity
- A strong understanding of morphology
- Attention to detail and the ability to concentrate for long periods
- Design skills and knowledge
- The ability to analyze quality or performance.
- Good supervisory skills
- Familiarity with all aspects of prosthetics and the manufacturing of thermoforming appliances
- Experience in crown and bridge metalwork
- CAM/CAD knowledge of implants systems.
- Work experience in a laboratory, dental practice, or hospital
- Experience in managing people
- Experience in business administration
- Experience in handling software and hardware.