Industry Veteran's Gamble Pays Off
Posted Aug 02, 2012, Published 2012-08-01
In 2006, Mike Mellon, CDT, a 24-year industry veteran, moved from Delaware to Central Florida to take an exciting new position as the department manager for a large laboratory. But two years later, he found himself out of work, yet another victim of the recession.
While searching for a new position, the owner of a local denture lab offered Mellon a deal: "He couldn't give me a job but he was willing to rent me a 500-sq-ft space in his lab if I would do his partial denture frameworks," he says. Mellon took him up on his offer and four weeks later opened M&J Partials--named for himself and his wife, Jodie, who co-owns the lab--using $45,000 of his personal savings to invest in equipment and supplies.
Pleased with the frameworks he received, the owner began to spread the word about Mellon's services to other labs and, as a result, M&J Partials began to grow. By the beginning of 2010, Mellon had hired his first employee on a part-time basis--his stepson, Kent, also a technician--and grown his client base to 12, including dentists. "The best advertising is word of mouth," he says. "Just keep your quality where it needs to be."
Mellon began looking for more elbow room and when he found a great deal in a 2,300-sq-ft commercial duplex in Leesburg, FL, he bought it. With the down economy, the price was right, and he committed to an owner-financed agreement that lowered the closing costs and allowed for a smaller down payment. The owner holds the mortgage and Mellon pays him directly each month; he now pays less for his mortgage than he was paying for rent and he will own the building in five years.
Like so many lab owners, his biggest challenge has been finding qualified technicians. Mellon's approach has been to hire inexperienced people who exhibit enthusiasm for the field as well as artistic ability. During the interview process, he takes prospective technicians on a tour of the lab and then has them try out the equipment and do some hands-on work. If they're comfortable and Mellon sees potential talent, he takes them on and trains them in-house, paying for their attendance at outside courses and webinars.
Today, the lab has five employees and 32 active dentist- and laboratory-clients. Mellon credits his past experience as a lab manager as a key factor in his success. "I have a firm grasp of the business end of operating a laboratory, so the transition to lab owner was easier than I expected," he says. For instance, in addition to attending numerous management seminars, he has expertise in overseeing inventory, setting fees, dealing with employee hours and wages, improving and streamlining production, and resolving technical issues. In fact, thanks to this business savvy, Mellon has already paid off all his equipment.
Another important strategy has been some mentoring from Mellon's former boss in Delaware who, although retired, still works as a consultant. He helped Mellon develop his initial business plan as well as his expansion and hiring strategies. "He told me what I should be looking for, how to pay accordingly, and even helped me find a phenomenal waxer," says Mellon.
Mellon admits the best part of the gamble of opening his own lab is being his own boss. Although he logs about 60 hours per week, he says ownership is much more rewarding than being just a number at a big operation. "We really rolled the dice, and I didn't take a paycheck for the whole first year, but it was worth it. It's mine. The lab has my name on it, so I really go the extra mile," Mellon explains. "I gear everything toward the patients and the satisfaction of their new smiles."
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