How the New Smile Source Lab Module Cuts Practice Overhead

With lab expenditures consuming a big slice of private practice revenue, a unified purchasing and lab ecosystem is a financial game-changer.

In private practice dentistry, managing overhead is a constant balancing act. While rent and payroll are relatively fixed, your clinical spending is highly variable. If you look closely at your profit and loss statements, you already know the reality: right behind team salaries, dental laboratory fees are typically a practice's second-largest operational expense.

That is why the launch of the new Lab Module within the Smile Source Marketplace at the end of June is a major financial milestone for our growing community of nearly 800 independently owned practices and more than 1,200 dentists nationwide. By bringing dental labs and clinical purchasing into one connected ecosystem, we will help you tame your overhead.

"The Smile Source Marketplace was built directly from what dentists told us they needed to succeed," says Dr. Jeff Osborne, Chief Dental Officer of Smile Source. "Private practice owners want scale, insights, and operational leverage, but they want it without sacrificing their independence. The Smile Source Marketplace delivers both.”

Driving Profitability Through Centralized Purchasing

On a recent episode of the ACT Dental Best Practices Show podcast, coach Robyn Theisen noted that a healthy standalone lab overhead target is about 8%. However, in modern digital practices that utilize in-house milling, the data can become obscured. "When they're buying blocks and things, that ends up going as a dental supply cost," Theisen explained. For an accurate financial picture, she recommends combining dental supplies (typically 5%) and lab costs for a combined target benchmark of 13%.

Whether your lab costs show up on an outside invoice or in your internal supply orders, keeping this metric in range directly impacts your profitability margins.

By combining transparent pricing, rebates, and centralized purchasing tools, the Lab Module platform reduces fragmentation and vendor fatigue through three core advantages:

• Leveraged Buying Power for Independent Practices: The Lab Module connects members directly with a curated network of elite, vetted lab partners. This gives you the collective bargaining clout and premium tier pricing of a large DSO while protecting your absolute independence as a doctor.

• Eliminating Administrative "Soft Costs": The Lab Module streamlines the entire ordering and tracking lifecycle into a single platform. The new efficiency reclaims valuable team hours. "This model gives dentists real options," says Ryan Steck, VP of Sales. "It's about protecting independence while delivering the infrastructure dentists need to compete and succeed long term."

• Preventing Spending Blind Spots: This new module brings your purchasing and lab spending under a single lens alongside more than 100 vetted vendors across supplies, equipment, and services. This gives you the total spending picture, so you can monitor overhead trends in real time, budget more accurately, and more quickly spot cost-saving opportunities.
  
  

Driving Efficiency to Protect Your Margins

Trimming overhead doesn’t mean cutting corners on clinical quality or sacrificing patient relationships. As podcast host Kirk Behrendt pointed out, finding the right lab partner is an investment rather than a mere expense—one that drives a clinical and financial return on investment. The goal of centralization is simply to eliminate the operational noise and clinical protocol errors, such as untracked remakes, that quietly drain your practice's resources.

By centralizing lab management and procurement, the Smile Source Marketplace provides independent dentists with the sophisticated backend infrastructure needed to protect their profit margins in today's economy.

As part of the broader Smile Source ecosystem, this tool supports your business from startup through succession planning. "This is about giving dentists real strategic options," says Tom Rimmer, VP of Strategic Partnerships. "We are building the tools, resources, and network that allow private practices to compete and thrive on their own terms."