It’s time to accept a new reality
It’s time to accept a new reality
The economy has changed, and so we need to change with it.

Inflation is here and business models have to change.

Right now, shortages seem to be everywhere. If it’s not Nando’s with no chicken, it’s McDonald’s running out of milkshakes. Supermarkets are sporting empty shelves, restaurants are running at full capacity (and then some), and nobody knows which goods are going to be hit next.

This isn’t a brand new problem; throughout the pandemic, we’ve seen strange and unusual shortages, which have affected grocery items such as flour and meat, as well as electrical goods and leisure items.

There’s no one sole reason for current supply issues, but in many cases labour shortages are a factor ­– it’s not the goods that are running low, but the people. After 18 months of living very differently, the world’s workforce isn’t keen (or able) to get back to business as ‘normal’.

In the dental sector, recruitment is also in disarray, with shortages in dental nurses and hygienists among others. Far fewer people are choosing careers such as dental nursing, where the responsibilities and demands of the role aren’t seen as recompensed by a salary which is too close to National Minimum Wage .

Where there are pressure points in market dynamics, inflation typically follows. It’s likely that the solution to dental staffing problems will involve greater financial incentives (such as salary increases), which will ultimately raise the end cost to the consumer. It’s a similar situation in the construction sector, where major timber shortages are leading to price hikes that will eventually trickle through to affect housing prices.

Economists were predicting a degree of inflation due to the global situation, but have been keen to describe this as ‘transitory’. Personally, I’m not so sure.

The Kübler-Ross five-stage model of grief originally explained responses to death and dying, but has since become accepted as a legitimate means of understanding how we process any unexpected bad news – from sudden divorce to a surprisingly hefty tax bill. The first of these stages is denial: a refusal to admit that something is happening, characterised by traits such as avoidance and confusion. At this time, we choose to live in a ‘preferable reality’, rather than actual reality.

By dismissing shortages and inflation as transitory, we’re at risk of becoming stuck in this preferable reality. Of course, the grief stages themselves aren’t always rigid – during the pandemic (and Brexit) we’ve also seen individuals, the media and the wider business community transition back and forth between anger, bargaining and depression – but it’s helpful to identify that this is what’s taking place.

It’s only when we begin to consider how we’ll go forward, that we can start approaching Kübler-Ross’ final stage: acceptance. If inflation is here and these changes aren’t transitory, it’s healthier to grasp hold of the situation and determine how we can act to make it better. The economy has changed, and so we need to change with it.

Your business model is not the same as it was in 2019, and it may require a stiffer evolution, but there remains an enormous amount of opportunity to be seized in the dental sector, with high demand for services. The new reality will have to look different, but the sooner we can face and embrace it, the sooner we can start getting our businesses where they need to be.

If you’d like help, get in touch for an objective appraisal and help with building your strategy.

The information contained in this article is based on the opinion of Hive Business and does not constitute formal tax advice. Any tax outcomes will be based on individual circumstances, tax legislation and regulation, which are subject to change in the future. You should seek specific advice before embarking on any course of action. Hive Business does not provide regulated Financial Advice, including advice on investment, insurance or lending products or their suitability for you. This article is provided for information only and does not constitute, and should not be interpreted as, investment advice or a recommendation to buy, sell or otherwise transact, or not transact, in any investment including Bitcoin and other crypto. Any use you wish to make of any information contained within this article is, therefore, entirely at your own risk.

By Ross Martin Management Consultant
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