Finance

Consider this strategy used by Laboratory Owner Mike Farago, Concord Dental Laboratory, Westford, MA: at the end of each year, he offers clients the opportunity to prepay a portion of the following year’s laboratory bill and has gotten $80,000 to $100,000 worth of prepayments nearly every year since.

Prepayment is appealing to dentists who may be looking at a hefty tax bill and need to spend money to reduce it. Some clients prepay what they estimate their January lab bill will be and others prepay a larger amount and start the year off with a significant credit.

From the lab’s perspective, the benefit is obvious: a large influx of cash. “In the lab, cash is king, of course; any opportunity to get money upfront from a dentist is hugely welcome,” says Farago, who is careful to advise clients to discuss...