Episode #248: Dr. John Montoya – Helping Dentists to Reduce Overhead Expenses

Dr. Eric Block: Welcome to the Stress-Free Dentist Podcast. I’m your host, Dr. Eric Block. As always, I want to inspire, entertain, and educate you on the best tools and technologies out there. My goal is to help make your practice and career more profitable, efficient, and most importantly, more enjoyable. And check out all of my nonfiction and children’s books on Amazon and check out the stress free dentist.com for any upcoming events. And if you’re feeling you’re a dental professional that’s burnt out, or you just feel stuck or want to get to that next level, visit the International Academy of Dental Life Coaches or www.iadc.com, and we’ll get you matched up with a life coach that understands dentistry. I also wanted to thank our amazing sponsor, Ekwa Marketing. They have helped me and my practice over the years to improve with SEO and website performance. And to find out how you can make your practice dominate in your area, go to www.ekwa.com/msm-sfd to book your complimentary meeting. Again, that’s www.ekwa.com/msm-sfd. Alright, everyone, welcome back to another episode, and today I’m joined by Dr. John Montoya. John, thanks so much for joining us.

Dr. John Montoya: Appreciate it. Thanks for the invite.

Dr. Eric Block: Yeah. I want to hear about, all about your journey into dentistry and about your software, dental purchasing partners, your group that you, that you founded. let’s dive right in, man. How did you even decide to become a dentist? Yeah,

Dr. John Montoya: it’s, it’s kind of a funny story. I, you know, I’ve wanted to be a dentist ever since I was a little kid. I don’t know what drew me to dentistry when I was so little, but, I’ve always talked about it. And then, as I got into college, you know, I thought maybe I’d go down the medical route. And so I started, interning with some doctors and every doctor that I, that I interned with just wasn’t happy with what they were doing. their life was controlled by the insurance companies or policies. They didn’t have kind of autonomy to practice medicine the way that they wanted to. And so I was actually, you can’t tell now, but I was working at a gym and, in shape at the time. And this older gentleman kept coming in and he was asking me about how college was going and, what was I gonna do with my future?

Dr. John Montoya: And I said, I thought I was gonna go this direction, and I was interested in dentistry, and he happened to be a dentist, and he said, why don’t you come shadow me and see, what life is all about in dentistry? And so I ended up, going to his office, one day a week while I was in college. And then he introduced me to his endodonic friend, and then he introduced me to his oral surgeon friend, and then he introduced me to his orthodontic friend. And so I was actually interning four days a week in different specialty practices in one general practice. And everybody was happy. They loved what they were doing. they had autonomy over their lives. They could make their schedules, break their schedules, ? and so, I really, I really fell in love with dentistry at that point. And so, life just took me that direction. And here I am today, still practicing.

Dr. Eric Block: And now where did you end up going? Where’d you go to college and where’d you end up going to dental school?

Dr. John Montoya: Yeah, I went to college at, UCSD in San Diego, and then I went to Creighton University. and then after dental school I went back to San Diego. I practiced in La Jolla for seven years. And then, as I started thinking about having a family with my wife, we didn’t really want to raise kids in southern California, so she was from Colorado, and we moved to Colorado and I bought a practice in Boulder. And, that’s where I’ve been ever since. Yeah.

Dr. Eric Block: And so after you said you went to Creighton, you went to San Diego, did you open up a practice, right from the start? Did you associate for a while? What happened there?

Dr. John Montoya: Yeah, I was like a quick associateship into a partnership. So, I was a partner for seven years. And then, sold my practice back to my partner, moved out here, bought a solo practice, and then I’ve actually owned multiple practices in Colorado. And, right before COVID I ended up selling off all my practices, but one, so I’m, I’m down to one practice now.

Dr. Eric Block: And so just going back, you were actually a partner and you sold out, the rest of your shares, or ownership to your partner, is that right? Mm-hmm

Dr. John Montoya: . Yep.

Dr. Eric Block: Yeah. and then, how did that work? I’m, I’m assuming that partner, because I’m in a similar situation where I’m 50, I’m assuming that partner had to have someone else kind of in the, in the reins to kind of take over your patient load, correct?

Dr. John Montoya: Yeah, that’s correct. after I left my partner started interviewing associates, and then, he actually brought on two associates and was at the point in his career. he was older than I was, and so he was at the point where he could slow down a bit. And so he brought on two associates to replace what I was doing and then kind of pick up a little bit of his, share as well. and then years down the line, I know he just kind of sold out to one of his associates. And I don’t know, I don’t know what the history of the practice is after.

Dr. Eric Block: And to me, San Diego sounds amazing, but, the weather and everything, and I’ve been to La Jolla. It is, it is nice. I imagine it’s not cheap to live there.

Dr. John Montoya: No, it’s, I say, I kind of jokingly say it’s great to be a tourist there, but it’s a different aspect of living. it tourist you get to see all, you get to go to the beach and you get to nice weather and then, but you’re, you’re only stuck in traffic for a little bit. You, and, dealing with the expense. And so, it is pretty pricey there. don’t get me wrong, lifestyle and everything is really nice, but, people are, trying to keep up with the Joneses out there, I think, more than, and living paycheck to paycheck than doing really well. Right. I, that’s just kind of the vibe that I had, especially in La Jolla, there was a lot of people that had nice things, drove nice cars, but when you presented treatment, they’re like, oh, I don’t know how that’s gonna fit your budget. .

Dr. Eric Block: Yeah. I used to work in some towns, outside of Boston, and they were pretty well off towns. And that clientele can be difficult, there, it can be a challenging, number of patients that come in and, man, I felt like such an imposter when I got outta school and I was trying to sell, not sell, but, educate and treatment plan and, get treatment plan acceptance from, CEOs and lawyers and doctors and engineers. And, some of them were, pretty challenging to, you know, to chat with and do dentistry on. So I was, I was glad I didn’t settle in a in a type of, situation like that.

Dr. John Montoya: Yeah. it’s, I can’t remember there’s a theory or a law out there, like the more you make, the more you spend, like you lifestyle just kind of keeps going up with that instead of, being satisfied where you’re at and then, having that income, grow and allow you to really build a nest egg and retire versus like, okay, I need the next thing, or I need, a new car or bigger house or bigger yard or, next vacation, that sort of stuff where, people kind of tend to overdo it and, e everybody does it. So, very few master not, letting their income get away from them. Yeah.

Dr. Eric Block: And I think Dennis can do the same thing, they see their friends that have two practices, three practices, and, you know, they feel like they have to do the same thing and keep up with the Joneses. And, personally I’m glad I didn’t. I have, I have a simple formula, one wife, one pet, two kids, one practice, one ping pong table. And, that’s, been what I’ve, I’ve stuck to, and I’ve heard when you’ve, you’ve had hit, multiple practices, I’ve heard when you go from that one to two and then that two to three jump, it can really be a stress,

Dr. John Montoya: ? It is. And I give praise to those doctors that are still practicing and managing multiple locations. you need a solid team behind you in order to do that. but it does take a, an exorbitant amount of time, if you’re still, you know, wet finger dentist and practicing and then trying to deal with everything else that goes on top of a practice. not even just one practice is a lot to take on. Add a second one and a third one. you’re, you’ve gotta have your systems dialed in. Yeah.

Dr. Eric Block: And now you actually, you moved, to Colorado and you said you had multiple practices, but then something happened, was it right after COVID where you were gonna sell your practices and then things kind of fell apart?

Dr. John Montoya: No. So, right before COVID, I just, I’ll be honest, I got a little burnt out with, running multiple things at once. And so, I thought at one point in time I’d kind of build an army of practices and then eventually sell this to, someone else and kind of walk away in the, into the sunset. But, it was just a lot to manage. And so I kind of got, to the point where I said, I don’t wanna go down that route of more and more and more. so I ended up selling off the practices individually, and just scaled it back down to one practice. And I sold the last practice December 19th, 2019. Right. Right before COVID, two months before COVID. and it made my life a lot easier. I’m happy to be back down to one practice. it simplified things a lot for me. but things changed with that as well, . And

Dr. Eric Block: Tell me about dental purchasing partners.

Dr. John Montoya: Yeah, so, going back to the multiple practice thing, I had, every time I added a practice to my portfolio, my vendors saw me as getting bigger. And so, with that, I had essentially economy of scale. And so my pricing structures on a lot of things got better, right? And, ev I would talk to ’em, I’d say, well, how come I wasn’t getting this pricing before? And they said, well, you only had X amount of practices and now you have y and so you can buy more. And that makes it more enticing for us. And so as I sold off the practices, those vendor deals went away, right? And I thought, this is ridiculous. Why am I now paying the most out of, when I know what the pricing was before?

Dr. John Montoya: And so I talked to my vendors and I said, well, how do I get that pricing structure back being a solo practice? They gave me a formulary and, I was able to really find a way to get economy of scale, but keep my independence. so I didn’t have to sell out to a DSO to get that pricing. I could see still be a solo practitioner. I formed a company called Dental Purchasing Partners, where we basically get a collection of doctors together, we get a collection of vendors together, and we get the economy of scale just like DSOs get. Yeah.

Dr. Eric Block: And is that for things like supplies and software and implants? Is it kind of all across the board?

Dr. John Montoya: Yeah, so we have over 80 different vendors. We’re trying to touch every aspect of the practice, whether it’s supplies, marketing equipment, different softwares, accounting, merchant services. you name it, we probably have it. If we don’t have it, we’re going after it.

Dr. Eric Block: Yeah. It’s, it’s amazing, like all the things you just mentioned, you, we, and what it takes to run a business and do dentistry at the, at the same time, it’s just so much going on in a, in a dental practice that, prices can get outta hand. And if you’re not, if you don’t have a good finger on the pulse of what you’re paying and what your expenses are, things can really get outta hand.

Dr. John Montoya: Yeah. And the creep is real. it doesn’t matter how much you produce, it’s, it’s really how much you’re spending and what’s that chunk in between, right? And so, a lot of doctors are, don’t realize, man, my supplies are 8% and they should be somewhere in the four to six range, and how do I get there? Or, when was the last time I evaluated my merchant fees for my credit card processing, or, I’m financing this, these patients, what’s my rate? Right? Or I wanna buy that new widget, how am I gonna get the money for it? and do I have to pay full retail? Right? You don’t have to one pay full retail. And, you know, there’s ways to, deal with your overhead to find money for the new equipment, give your staff raises, add a 401k or whatever.

Dr. John Montoya: ’cause if you don’t have the overhead, where’s that gonna come from? It comes from the either the doctor’s salary or it doesn’t happen, right? And that’s the worst thing. the other thing that you look at is, okay, like at some point in time you’re gonna want an exit strategy, right? And so, if you’re a million dollar practice, say your practice A and you’re doing a million dollars, but your overhead is 80%, you’re gonna, your price isn’t gonna be the same as, is practice B doing a million dollars in, elections and your overhead’s 50%, right? those are, those are wildly different practices. And you could take that 80% and get it down to 50% with some simple changes. And that’s what, that’s what DSOs are doing. They’re coming in and buying these practices that aren’t run as efficiently as possible. And they’re just saying, okay, well supplies check. We’ll cut that, we’ll cut this, we’ll cut that, we’ll cut that. And they’re just, they’re just really successful at doing that because they have the ability to get these things at economy of scale, which the private practice can’t negotiate that on a, on our, on their own. And that’s where we come in, ?

Dr. Eric Block: And how does it work? Is it, is it a membership? is it a, is it a monthly fee? How does someone get in your network?

Dr. John Montoya: Yeah. So it’s, it’s a membership fee. It’s, it’s month to month, no long-term contracts. it’s only 97 bucks a month. And so, we can find you that $97. So the membership is essentially free. just on a supply order alone, we’ll find you a $97 in savings, and then the rest is cherry on the top. So, that’s how we get the leverage to go to these vendors and say, okay, we’ve got this paid membership group, they’re all interested, they’re all using our network. What can you do for us? and the vendors look very favorably on a type of relationship like that.

Dr. Eric Block: And how does it work with, let’s say I’m using a specific type of bonding or cement or composite, and I really want to keep, continue to use that. how does that work with your software to find the best price?

Dr. John Montoya: Yeah, so we have, major retailers, so you don’t have to change anything, so if you’re using, reli cement, you can get the same cement through our suppliers. we do have a procurement software that will shop all the major retailers, whether that’s Henry Schein, Patterson, Burkhart, Benco, Darby. It’ll show you all the pricing for everybody, including ours, to make sure you get the best price. So if you wanna, really order from a particular vendor, you can, but at least the pricing structure for everybody else. so, we want you to use the same stuff you’re using. We don’t want you to change just because X is cheaper, but you’ve never used that before. use everything you are just don’t pay full price

Dr. Eric Block: . And, just curious, what do you think out there dentists are just, o really overpaying for as a, as a private owner? Is it the credit card processing fees, like you mentioned? Is it just, in general, just your everyday supplies that we’re using? What are seeing out there?

Dr. John Montoya: Yeah, some of the big things are supplies, credit card processing, and then just all the different payments for different softwares that you’re, they’re adding in. people have great, stuff with like dental intel or mango or, so a lot of these different things, but a lot overlap, right? And so, they’re using one feature here and one feature there. And if they wanna keep that, if they went direct to the vendor, they’re probably paying top dollar. So, what we do is we go and say, okay, well you have Mango, you have dental intel, you have this, our pricing structure is X, you’re paying Y let’s get you down to Y if you wanna keep all those. Okay. or do you have something that’s doubled up? Do you really need that?

Dr. John Montoya: ? and then the last thing is when people are trying to add equipment, I love our dental reps. They’re super important. and they’re a great benefit to the practice, but they get paid with how much you spend, right? And so, you know, if you say, I want a new Interal camera, they’re gonna give you a price and they may discount it 5%, but there’s a lot more margin in there to play with, ? And so you’d be amazed at what some of the market for this stuff really is. , it’s mind blowing. And that 5% that you think you’re getting a deal, you’re not.

Dr. Eric Block: And now you’re, like me, you’re still full-time practicing. I’m at three and a half days a week. I think you’re, you’re somewhere in the same ballpark. Mm-hmm . you know, people always ask me, how do you do so much? what you’re doing? And like, we were chatting earlier and I enjoy this, I enjoy doing podcasts and I enjoy what I do with my software and my books. doing a number 15 crown on a patient that can’t lie back and can’t open wide, that’s work. So to me, this just flies by. what are your thoughts? I know you had a, there was a eureka moment where you saw there was something, a problem you could solve, you became an entrepreneur, how do you fit it all in a day, being a practicing dentist and the founder of a, of a software and GPO company?

Dr. John Montoya: Yeah. it’s just, it’s really comes down to scheduling and, tailoring your life the way you wanna see it, right? I do still practice three and a half days a week, but I engineer my schedule where, I’m not running from patient to patient. we spend quality time with our patients and then I’ve got dedicated time for, this business and then, I, structure dedicated time that I make sure I’m home and spending time with my family and my four kids and, doing things that I enjoy and love. And so you, dentistry is great and it gives me the lifestyle and the ability to do that. and I think that can happen for every dentist out there, really.

Dr. Eric Block: And now let’s, let’s wrap up with two final questions. The first one is, how do we find out more about what you’re up to? And then the second one is, what advice would you give to the young dentist out there?

Dr. John Montoya: Gosh. so how to get ahold of me Dental purchasing partners.com is our website. I’ve got a scheduling link on there. My phone number, you can, it’s my personal cell phone number. Anybody can get ahold of me at any time, on that number. My email address is on there, John, at dental purchasing partners.com. you can peruse our vendor list and see who we are. currently offering, we’re, we’re adding members and vendors all the time. And so, that’s an easy way to look at what we’re doing. and then, gosh, for the young dentists out there, don’t get taken aback by the shiny new thing. don’t overextend yourself like we were talking about earlier. Gosh, my colleague has the latest CBCT or, has two practices or lives in this certain neighborhood.

Dr. John Montoya: ’cause everybody’s at a different point in their lives and everybody’s at different point in their education. And really, cash flow is king. You wanna, your office to cash flow and cash flow very successfully because when you’re not worrying about when the, when the payments are coming in, or, the bills are stacking up, life gets a whole lot easier when you’re not stressed about paying for things, right? And so, that stuff will come in time. look at all the dentists that came before us, they didn’t have 3D printers and they didn’t have CBCs, and there was some amazing dentistry being done, right? so it can be done. and I’m not saying don’t get that stuff. I’m just saying, you know, be conscious and think about it and make sure that it works within your budget, works within your cash flow. because there’s ways to do a lot of this dentistry, do a lot of the modern stuff and not have to get yourself, indebted to a payment, right? there’s ways around that until you can buy it outright or, you know, make sure it fits within your budget, that kind of thing.

Dr. Eric Block: Yeah, I found that, now I’m, I’m 50, I wish I had done this earlier, but I no longer compare myself to others. it took me some time to do that. when I was younger, I would go to conferences and lectures and seminars and would compare myself to the people I was sitting next to or the person speaking. And it often did not, mentally turn out well. I would leave those conferences feeling worse. so I no longer do that, I’m happy with what I’m doing and, I don’t compare myself to my peers or, if I go to a conference, the person’s speaking, ’cause they may, they may be showing their best work. they’re not sharing the bad review they got or the fact that they had to redo that crown, eight times or that filling, kept breaking, we all have these issues. so, do the best you can. And I really found that, keeping positive people around you, removing those comparisons, removing negativity from your life is really been, is super powerful for me.

Dr. John Montoya: Yeah. Yeah. And the young guys, start investing early, right? save 10% of your salary and just put it aside. Get a good financial planner, start a 401k, start investing so you have an nest egg 20 years into your career, or, if it grows to the appropriate level, you can retire early if you want to, you don’t have to, but you don’t, you have the option.

Dr. Eric Block: Great stuff, man. John, thanks so much for the time and, excellent episode.

Dr. John Montoya: I appreciate it. Thank you.

Dr. Eric Block: Thanks again for listening to the Stress-Free Dentist Podcast. And don’t hesitate to get in touch with me at info@thestressfreedentist.com. And if you haven’t already, please subscribe on your favorite platform and leave us a review. Until the next episode. I’m Dr. Eric Block, the stress-Free Dentist.