Clinic decision guide · By the Modirify team
Reviewing service costs when material prices increase
When material prices rise, a service’s calculated result may fall even if its selling price stays unchanged. Start by updating cost inputs and reviewing their effect. Changing the selling price is a separate decision subject to the applicable agreements and policies.
A material cost is not the whole service cost
A service may include materials, chair time, dentist commission, laboratory costs and other components. Count each component once and check that commission or depreciation has not been included twice. Define the result: a procedure margin based on selected inputs is not necessarily the clinic’s net profit. Review inputs with the person responsible for accounts before using them in a pricing decision.
Before the material-price change
This fictional example is not a suggested price for a clinical service. Assume a selling price of EGP 1,000, materials of EGP 200, allocated operating costs of EGP 250 and dentist commission of 20% of selling price, or EGP 200. Modelled cost is EGP 650, the remainder EGP 350 and the margin 35% of selling price. Laboratory charges, payment fees, taxes and any unmentioned costs are excluded; add what applies to your case.
After the increase, with the price unchanged
If materials become EGP 280 and everything else remains unchanged, modelled cost rises to EGP 730. The remainder becomes EGP 270 and the margin 27%. The remainder falls by EGP 80 despite an unchanged patient count and selling price. This is illustrative arithmetic, not an income statement or a clinic profit forecast. Check that the new material price, unit and quantity correspond to the correct service.
An equal price increase may not restore the remainder
If the example’s selling price rises to EGP 1,080, percentage commission rises from EGP 200 to EGP 216. Cost becomes EGP 746 and the remainder EGP 334, not EGP 350. Do not assume that adding the material increase to the selling price restores the old result when commission also changes. This is not advice to raise prices; it explains why recalculation matters. Decisions about clinical materials and care quality belong with the dentist and professional standards, not price alone.
Record the review and decision
Keep the date and source of a changed material price, identify related services, and review units, quantities and cost components. Compare old and new inputs and document the decision: monitor, review operations, or revise future service pricing under the applicable agreements. Do not automatically change historical invoices because a new purchase invoice arrived. A current cost estimate and a previously agreed selling price are different records.
Use current inputs rather than an old figure
Modirify connects service economics with recorded materials and inputs. The Alpha story describes using purchase prices to monitor service costs; this does not mean automatically changing selling prices. Try your inputs in the related service-economics calculator and review stocktake information to check quantities. Reassess after material changes in supplies, overhead, commission or procedure duration, and when correcting errors in the underlying records.