New Business Models Bring Challenge and Change
Posted Apr 28, 2011, Published 2011-01-01
Life changed dramatically for Donna Pickett's laboratory in Taylorsville, Utah, when she added milling services and became a zirconia distribution center.
For more than 10 years, it was just the two of them: Donna Pickett, owner of Broadway Dental Lab in Taylorsville, Utah, and her son, Sullivan Heward, fabricating conventional PFMs. And when dentist-clients started prescribing zirconia restorations in 2007, she subcontracted the work to a nearby laboratory. But as the lab's zirconia business increased, so did the subcontracting costs and Pickett had to reevaluate her business model. Embracing digital technology, Heward decided to learn everything he could about milling zirconium. He did a lot of research and, in 2008, the laboratory purchased a 3Shape scanner, five-axis milling system and two sintering ovens, and added milling services to its repertoire.
"It was a scary move for a two-person laboratory to spend $200,000 on equipment but when our subcontracting costs became the equivalent of the cost of a milling machine, I thought it made sense to buy one," says Pickett. "What I didn't initially factor into the equation was the need to hire additional staff to handle the scanning, designing and milling responsibilities. Once I realized that need, we decided we had to offer our services to other laboratories to compensate for the cost of the new employees."
The expansion into lab-to-lab subcontracting has proven to be a boon for business. The laboratory's workload has more than tripled in two years, with 75% of its caseload coming from other laboratories. It's fabricating about 140 units per day, hired four new employees to handle the workload and moved into a larger, 1,760-sq-ft space. The lab is also much more profitable, but it's putting all of that profit back into the business. The journey has been fun, but not without challenges. "One of the hardest parts is getting our name out there. We've used direct mail, e-blasts, advertising and a lot of cold calling, and competitive pricing on our zirconia copings," says Pickett.
The lab has also expanded in another area: last April, it opened a distribution center and was named the exclusive distributor in the U.S. and Mexico of Dental Direkt's isostatically pressed zirconia blocks, the zirconia material the lab has been using in its restorations. (The lab changed its name to Broadway Dental Lab & Distribution.) "We're proud that Dental Direkt selected us instead of several large distribution companies it was considering," says Pickett. "When time permits, the staff acts as sales people, making calls to get the name Broadway and Dental Direkt out there."
As the lab's staff has increased to six people, Pickett's role has changed tremendously during the past two years. By establishing relationships with her laboratory customers, she's gotten more involved in the industry. She's also had to learn how to be a boss and mentor and prides herself on maintaining the family atmosphere in the lab. She and Heward include the staff in making decisions that affect the company and ideas are shared during frequent staff meetings. Everyone works in one large room, making it easier to keep them informed about developments or if someone needs help.
"Happy people are the key to great service and all of us get along well. Having a larger staff is more fun. Every day is an adventure," says Pickett. "As scary as it was making the change, it has turned out to be the best thing I've ever done."
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