Chad Park is the President and CEO of Acero Crowns, a leading manufacturer of preformed pediatric dental crowns. Dr. Park graduated from dental school in 1996 and completed a GPR residency program at UT School of Dentistry and Hermann Hospital in Houston. He graduated Harvard Business School in 2010. Dr. Park and his wife Dr. Rita Ne own and operate 6 Bravo Dental Clinics throughout Dallas. They have 2 daughters age 8 and 16 and he is a avid Crossfitter.
VIDEO - DUwHF #1075 - Chad Park
AUDIO - DUwHF #1075 - Chad Park
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Howard: But it's not made in China; it’s made in Taiwan.
Chad: Made in Taiwan, yes. There's a lot of people that also get confused: Taiwan, China.
Howard: Let’s talk about that just for a little history. So basically, when (00:00:19 unclear) did his revolution, the existing government fled to a little island called Taiwan, right?
Chad: Yeah, I am not the expert on Chinese history, but yes.
Howard: So it'd be like if Trump took office and all the Democrats fled to Cuba and there was basically no one living on Cuba. When the mainland Chinese government fled to Taiwan, was it uninhabited?
Chad: No, there's Taiwanese Indians that they call just like in US.
Howard: So they are indigenous people; people got there first.
Chad: Yes, definitely but China still claims Taiwan as theirs so China does not recognize—
Howard: But it's just chest beating.
Chad: Well, you remember how much flack Trump got because he accepted the phone call from the Taiwanese president and we have never had a sitting president accept a congratulatory phone call from Taiwan because that is just going to piss off China and Trump did it. That pissed off China.
Howard: Yeah. But I’ve got to tell you my funniest political story in China. If you lined up ten dentists in a row, the first ten dentists you found, and said, “Name five Chinese dynasties or presidents or leaders or prime ministers or whatever you want to call them.” How many of them could even name one? How many of them could even name the president of China right now?
Chad: You’re talking about right now if you go to China?
Howard: China’s got a five thousand years or just name like, the three largest dynasties. So I was in China, I was having breakfast with the president of the Chinese Dental Association and some other dentist. I was having fun and I just love China, I just love everything about it and I asked them who was their favorite US president. These really smart dentists, nobody could name one.
So that became my new hobby: asking every Chinese dentist, “Can you name an American president,” and I said no because when I'm over here and I go up to any dentist and say, “Well, name a Chinese leader.” I mean, you've got five thousand years to pick from.
So it's so funny how when you're in the dental community, there's no politics. I mean, nobody over here knows their leaders, the dentists over there and they just- But what I love the most about China is my God, they got a work ethic. I mean, it's like all they know is work. They'll outwork you. I mean, the forty-hour work week in America, Monday through Friday? Chinese, they wouldn't consider that.
Chad: It's all perspective, right? I love this country. I mean, the opportunities. I could never be here if I was in Korea. That's why my parents obviously— I'm the classic immigrant story. They came to the US looking for opportunities and so yes, the work ethic is amazing there and partly we look at US, we just got to tap ourselves and go, we're so fortunate.
Howard: Yeah, but the classic immigrant that is the single greatest paradox in American history, because if you say to any American, “What made America great?” “Well, people from all over the world, from every country on earth, they all came here. The Italians brought pizza and then Irish and everybody came here.” So Ellis Island, everybody came through Ellis Island. So let's open back up Ellis Island and let everybody come in and give them citizenry. “Oh no, you don't understand. It was good for my grandma and my great grandma and my great, great grandma, but nobody else,” and then you look at all these rural towns in America and they say, “Well, they closed down the factory.” Would you stop with that story? Who started that factory? What's the big yogurt story? The guy that went and bought the bankrupt yogurt company. He was from what, Pakistan?
Chad: Yeah, I remember hearing that. Is it one of the—
Howard: The Greek one.
Chad: The Greek one, yeah.
Howard: Find out where he was from, Ryan. I think he was from Pakistan, wasn’t he? So when I was little, we'd go on these campout vacations; you get the camp or the tent, you go to all these lakes and each city we would stop and we would go to the— We're talking towns to like a thousand. And they say, “Oh yeah, this group came from this country.” They were all fleeing the Catholic church; they brought this religion, Presbyterian, Lutheran, Mennonite, Mormon, whatever the heck it was.
So all these small town deals that are closing down, they were all started by an immigrant and you opened up immigration and let all that— Whenever you vote on your feet and move to a different country, you are a class above the rest. You’re ambitious—
Ryan: It was an immigrant from Turkey and he brought Greek yogurt.
Howard: What was his name?
Ryan: Chobani is the name.
Howard: Yeah, Chobani and he's from Turkey?
Ryan: Yeah, he’s from Turkey.
Howard: So the bottom line is: you look at a guy like you. So you started Acero Crowns. Well, you're an immigrant. Well, when you go to Mexico the ten million Mexicans that left Mexico, they came here. They are far more ambitious than the fifty million less motivated people out of their country of a hundred million people. So the cream of the crop.
Here's what's even more bizarre: we're approaching eight billion people. Only 1% of the planet is like you who's living in a country he wasn't born in. 99%.
Chad: That would have shocked me.
Howard: Yeah, 1% and look what this 1% kid did; built thirty-six offices then he did it again, got six then he started Acero Crowns and then look at your kid. He's sitting on an Xbox eating Doritos. Yeah, that kid is never going to have thirty-six offices because he was born too comfortable. And your journey; you lost your dad early, you immigrated to another country, you had all these challenges and it made—are you King Kong or Godzilla? And your wife has the same story.
Chad: Same story and my wife and I had this conversation every night because what our secret sauce or what gave us the superpowers to become successful was what we didn't have. What we didn’t have, what our parents couldn't provide us, which fueled our drive, our passion and how do we teach that to our kids?
Howard: It’s easy. You just move them back to the poorest country, you find the poorest orphanage in Asia and you send them there tomorrow.
Chad: That's the thing because our daughters are not growing up how we grew up and how we grew up is what got us to be successful and it scares the bejesus out of my wife and I every day.
Howard: Well, you'd know your two daughters by the time they're twenty-one, their names are going to be princess one and princess two. But what's so sad is I don't get into politics because people don't have open minds about religion and politics after the age of twenty-one and there is no way. Like my two older sisters went straight into the nunnery after high school. My oldest sister has been a nun for thirty-five years. You think I'd get into a conversation with her and make her Lutheran, Jewish, Hindu or? You can't, but it's so sad to see this country stumbling because we only had about a 2% growth rate for two decades. You opened up Ellis Island, we'd be back to a double digit growth rate; we'd be back to 10%.
Chad: Yeah. Well, I'll tell you this. Here is where I feel like the US just kicks everybody's butt especially the Asian countries. I dare to say that the kid who graduates in the 75% of his class, like he is not in the top percent, he’s probably number seventy-five in his graduating class out of a hundred; he’s in the seventy-five percentile. That kid can come to the US and be valedictorian at a lot of schools because in Asia and I'm not saying this is great, Asian education is so intensive.
I mean these kids are under so much stress because when I go back to Korea and when Rita goes back to Taiwan, we’ll see our—back then it was our cousins, now it's our nieces and nephews—how much stress; they're going to school twelve, fourteen hours a day and they're only in junior high. It is life or death for them to go to a good college.
So here's the sad part and it's the same in Japan, these kids are so smart as far as taking tests and they're just so smart. They get to college it is party city, is a joke. That's where the US colleges just kick butt. So you look, you go these Asians and I'm sure it may be this way for other countries, but “These Asians are so smart!”
Well, how come every single time someone wins the Nobel Peace prize or something someone comes up with, “Why aren't there these Asians that are?” It’s because these great, smart minds, unless they're super uber rich where their parents can send them to go to a college here in the US, they're going to get into a college in Korea and just party and then they're going to have to do their army, they still have the draft.
So where the US just the schools here, I mean we're pumping even though we may have a lot of, what did we say millennials or just anybody that are entitled, they don't have the passion, they're lazy and all this stuff, still there is that bit that will go to college and they will go to graduate school and they become the Jobs, they become the Bill Gates. Whereas, that doesn't happen in Korea in colleges.
So that's where I feel like the US just when people say that, I say yeah, we can say all we want Asian kids are smart that a kindergartener's learning multiplication or whatever, they're learning algebra in fourth grade but at the end of the day, when you see where they are at age eighteen or twenty-one, I mean hands down US colleges.
Howard: Well, the greatest powers, he moved all around, it used to be Genghis Khan. I mean, he had an area the size of North America. There used to be a thing called the Roman Empire if you read back far enough. There were all these empires and they’ve all come and gone and I'll tell you what, the only secret sauce of this almost three-hundred-year-old empire was Ellis Island and the day you close that down and started screwing with it, your rapid growth has been I mean, you've grown your productivity 2% the last generation or so.
And now you want to build a wall and I don't really even care because I don't really care that it went from Genghis Khan to the Roman Empire then it went to Portugal then it went to Spain, then it went to the United Kingdom and then it went to here and it's already China. I've been there, they've already passed your GDP on if you measure it by purchasing power parody. Not by the US dollar, but by PPP it says number one and so open up Ellis Island or just talk to Genghis Khan.
How long did the Mongolian empire last after Genghis Khan died?
Chad: I'm not a history major.
Howard: Like about eight seconds. The Roman Empire lasted six hundred years, that's about probably how long the American Empire lasted.
Chad: Who’s that author? He came up with the book exactly; he's using that historical data. He's like, “I'm not bashing the US.” He goes, “It's just there is going to be an in.” Historically, it's just a matter of fact.
Howard: Because they all get lazy, entitled, want benefits, don't want to pay taxes and want everything for free and what's your counter balance to that? Endless wave of immigrants who will work harder, cheaper, faster and it's like selecting the super bowl team. If you want to win a super bowl on the NFL, you've got to get the best fifty players. Well, you know who the best fifty players are? The people who will move all the way from Africa, Asia and Europe to come here. Not your kid over there eating Doritos, playing Nintendo who thinks everything should be easy.
You’ve seen that Bernie Sanders moment? “Oh yeah, free college, free health care, free everything!” Yeah okay, goodbye.
First of all, where did you get the name Acero? Is that because—?
Chad: First of all, Ryan, there is no way I could have prepared for this. No way!
Ryan: I told you, right.
Howard: That's why we call it Dentistry Uncensored, it's no holds barred.
Ryan: People always ask me how can I prepare for this? I’m like just don’t bother.
Howard: But people like Dentistry Uncensored because they would rather know what I honestly feel and not agree at all than the government which has 11% approval rating; they're all in a suit and tie being proper, but you know they're lying and they're not telling the truth. I'd rather anybody telling me what they believe and I disagree 100%.
Like my five sisters, my God, I don't agree with anything they say, but I love them and they're honest and we have an honest, open conversation and hug and eat dinner and we're best buddies and we text and call every day. What's the trade off? Someone lying to you? I don't want you to lie to me and then when you're trying to figure out what I want to hear, so now you're lying to me trying to gain me.
They'd rather say, I mean I love when my email says some guy said the other day about my dental therapist. He goes: love your show, listen to it every day on the way to work. Disagree a 100% on everything you said on dental therapist, still love you. You know what I mean? It's like great and that dentist who says he doesn't disagree with me I’ll say, “Well, he doesn't disagree with something with his own mom, his own life, his own spouse.” Just be honest with me.
But where does the name Acero came from?
Chad: I'll tell you this, the second hardest thing that we had a challenge was come up with a name. We came up with a lot of names. They're all taken! Did you try to trademark? I mean we came up with crazy names like Titan, Triton, just stupid names that two dentists are coming up with and then we started going into other languages because every single word we came up with was just like already trademarked you can't use it. So we said, “Okay, we’ve got to go to another language.”
Howard: Another language?
Chad: Yeah, just and it was actually Todd's, I think it was Todd's wife at that time.
Howard: Todd's wife at that time?
Chad: At that time.
Howard: Meaning (00:15:29 unclear) different wives.
Chad: I don't know how, but I think it was a collaboration because it was Rita, myself, Todd and his wife and we were just brainstorming and I think somehow we said, “Well, what's steel in Spanish?” It was acero and we all went, “Ooh, that rolls off the tongue pretty good, acero, acero” and we just sat there and we were like, “Oh hell, it's Acero!” So that's how we came up with the name. We went through so many different things and it was just bottom line, it was that, it was Acero.
Howard: I thought it was, you were watching Ace Ventura and you just extended ace out but acero means steel in Spanish that is so damn cool.
Chad: It just rolled off the tongue very well and it's A so A is a good word for alphabetical order and listings.
Howard: So you had the idea, 2007, you made your first crown in 2008 and now it's a decade later, it's 2018. How's Acero Crowns doing?
Chad: So I was that naive dumb dentist that thought, hey, if you come up with a great product and provide a great value, people are going to buy it. Well Howard, I was very naive. 3M is not going to let you enter their market that easily and so I guess this is uncensored if I'm going to just let it out.
I had doors shut on me; every dealer just they were interested in the door shut on me. “Great product, yeah, we have dentists all time trying to ask is there a private label brand of crowns that we can possibly buy because these three and crowns are getting expensive” and I talked to all the dealers. Really, all the big boys. “Oh, we've been looking for that” and then.
Howard: You didn't talk to my dealer.
Chad: Then the phone goes silent and through the years, I have found out that yeah, there were some forces at work there.
Howard: You should've called my dealer.
Chad: What's your dealer?
Howard: Well, he only sells drugs but he’s sort of an adverse dental.
Chad: And so I had to resort to—well, Howard, I heard a story about you. How did you market your practice when you first opened up your practice?
Howard: How did I first market? I went door-to-door.
Chad: Exactly! I went phone call to phone call. Just random cold calling.
Howard: To dentists?
Chad: To dentists!
Howard: And then did you focus on pediatric dentists because they’re the highest volume?
Chad: No. I focused on pediatric dentists, yes, but I also focused on Medicaid providers.
Howard: So this is the same thing is going on Amazon right now. When you talk to these people, they're off the record. They’re saying, this is crazy, if I sold my stuff through Amazon who's at a booth at the Greater New York meeting the last two years in a row, I know my dealers will blackball me, but those same dealers are selling their generics on Amazon.
So you go to Amazon, the dealers are selling their stuff, but all their customers so here's what I'm predicting on the Amazon deal. It's going to be like a damn collapsing. So someone big, I mean they got to be a billion dollar, but they got to be 3M they got to be a Ivoclar, they got to be Dentsply Sirona, really big boy or a really big girl once one goes, everyone else will be there the next morning at 8:00.
Chad: So we've been following Amazon very closely and they're making a play in the dental. If you saw the latest email that ADA sent out, ADA is promoting Amazon: buy your dental supplies at Amazon. I have it on my phone.
Howard: Send me the email.
Chad: Yeah but if you go actually go on it and—it's got 3M, it's got Dentsply, it's got the name, but when you go on it, the only products available are basically the homecare like toothbrush, mouth rinse.
Howard: Okay, so you're saying B2C business to consumer not B2B dental manufacturer to the dentist. So you're saying that on Amazon right now?
Chad: No, but they’re trying to get it to the dentists.
Howard: They're trying to go B2B?
Chad: Oh, absolutely! I've been involved in some of the—not me directly, but I've been talking to the people that have been in direct discussions with Amazon.
They've got a game plan to penetrate the healthcare markets itself to physicians, to dentist directly.
Howard: Sure. It's 17% of the economy, they're not going to not pay attention.
Chad: And they're having a hard time. They're having a hard time.
Howard: Well, look at Tesla trying to sell cars. The fifty states, the dealers have passed all these laws that you can only sell a car through a dealer and it's like so get rid of that law. But why can't they get rid of the law because the dealers give all the people.
Chad: This morning, Gordon Christensen's lecture, he spoke about it. He actually told everybody, support your dealers. Don't buy Amazon. Amazon cannot help you with—they just sell a product. You go to your dealer, they'll be able to give you some information like, “Oh, we had this other product that could be this or that and this doesn't go together.” So a small little sound bite, but he said, “Buy your supplies from your dealers.”
Howard: So eighty-three-year-old Yoda Gordon, that's his culture; it’s the good old boy. He’s eighty-three, that's all he ever knew and now the millennials are sitting there on Amazon Prime and Amazon has half the voice search so where's my Amazon Prime? See, my problem is I just can't flip it and see.
Chad: ADA vendor showcase: buy your dental supplies—
Howard: Can you forward that email to me? I am email@example.com.
So yeah, it'll be interesting to see if they will deregulate industries to see if I can buy a Tesla through mail order. It'll be interesting.
So are you selling your crowns on Amazon right now?
Chad: I have been thinking long and hard on this because at the same time, I now have dealers, I don't have the big boys but I've got dealers that I'd love to—
Howard: Do you have Schein?
Howard: And why would Henry Schein with a quarter of the market not want to carry? They move a billion dollars of 3M stuff a year and then what about number two Patterson, what about them?
Chad: Yeah, I've been in talks with them.
Howard: But are they carrying it today?
Howard: What about number three, Benco?
Chad: I know Chuck! He was one year below me at Harvard.
Howard: And the only dentist I know. No, I only know two people in dentistry that have been published in the Harvard Business View and Chuck was one of them. And his brother Rick and his dad Lawrence
Chad: And I've talked to Chuck and I've talked to Rick and I've got to watch what I say, I'm just saying that the 3M has a very big footprint.
Howard: He at least he probably honestly told you what the deal was?
Chad: Yeah, I knew before talking to him.
Howard: But I mean, he was a year behind you in school so he can tell you over a beer, the truth.
Chad: I think Chuck's very politically correct.
Howard: So Benco is his grandfather, Benjamin and I don’t know is it Benjamin Company or Benjamin Cohen? I think it’s Benjamin Cohen, Benco and then his son, Lawrence who was a huge role model of mine for the last thirty years and now Chuck and Rick are third generation and I love these romantic businesses.
The fourth one would be Burkhart and they're on fourth generation. That girl CEO, she's the great granddaughter; talk about an American story. It's a century old company and I always tell her that I mean now I have dental school class is women and you're the only woman CEO that sells supplies, work that card and she's like.
Chad: Our products are all for their hands.
Howard: But is Burkhart carrying it?
Chad: They're in discussion, but the discussion just goes cold.
Howard: And you've had a product for ten years?
Howard: Okay. So then what dealers are doing it?
Chad: So the dealers that have I’ll say the gonads to go up against—
Howard: The Stones.
Chad: Yes. Midwest Dental, love them.
Howard: Where are they out of?
Chad: Wichita Falls, Texas. So they have a big presence in Texas and Oklahoma.
Howard: Well, tell them to come on the show because I was born in Wichita.
Chad: Oh my God.
Howard: And he might not know there's another Wichita outside of Wichta.
Chad: Tim Cluley, the COO, is the greatest guy. I mean. Oh my God.
Howard: What's his name?
Chad: Tim Cluley, C-L-U-E-L-Y.
Howard: There he is! Handsome devil.
Chad: I got to tell you the story, Howard.
Howard: So now that dealer, is he just in Texas or?
Chad: Texas and Oklahoma, they're a good size dealer.
Howard: Potential global case. So what other dealers? Atlanta Dental in Georgia.
Chad: Practicon, it's been fantastic.
Howard: Who's the CEO of Atlanta Dental?
Chad: I don't know the CEO.
Howard: And then the next one is what?
Chad: Practicon. You know Practicon, they’re great.
Howard: Who's the CEO of Practicon?
Chad: I don't know, it's a pediatric dentist that started the company or was one of the founders but now I believe it's run by his hygienist who, I mean, this is years ago but I think she's the CEO. I can't remember her name, though.
Howard: They're out of Greenville, North Carolina?
Chad: Yeah. We've got Dental City out of Wisconsin. Indico, also Wisconsin. God, I hope I don't forget a dealer that's been—
Howard: So what is your marketing? How are you getting the word out?
Chad: So like you, door-to-door going to these dealers and they all love my product, but then somehow somewhere it comes to a grinding halt. But I was introduced to the dealer, a good friend of mine is a Brad Heckerman, who was the CEO of American Eagle Dental Instruments. Are you familiar with them?
Howard: Yeah, up in Montana.
Chad: Yeah, never sharpen, never dull. So Brad, his sales director for North America—
Howard: Who’s the owner of that, the woman? Oh, American Eagle!
Chad: American Eagle Instruments, the hand instruments for hygienists.
Howard: Right but there’s another one up there. There's two up in the same place, one of those dealers was—
Chad: But Brad was the CEO and he introduced me to his North America sales director, Lewis Myers, you know obviously Lewis, who introduced me to you. Lewis has introduced me to his network of dealers and actually I owe it to Lewis for introducing me to Midwestern, Atlanta Dental, Practicon.
Howard: He lives in Dallas now, right?
Howard: He is one of the most well-connected, hardworking, ambitious guy, my God. He’s very cool. Shout out to Lewis.
Chad: And it was Lewis that said, “Chad, okay, I got to get you on Howard” and I told him I was working on this video. He goes, “Okay, you got to make the video first because Howard's going to dig your video.” So he kept postponing it and finally I said, “Lewis, I finally finished my video.” He goes, “Okay, I'm going to get you out, show Howard the video.”
Now the video, you would have loved my unedited video. It just made fun of- I mean, come on, we all have to have a sense of humor, right? You got to make fun of yourself, make fun of us as a dentist treating a kid, helicopter mom that's hovering over you, “Is it hurting? Is it hurting? Is this bad? Dentist hurting you?” or the archaic 3M numbering system.
If you practice pediatric dentistry, this is all happened to us at one point: the tray flips off. There's a hundred crowns on there, it was like two hundred crowns on there. It comes off and you've got a mess and so we filmed it, making fun of all that stuff and then—
Howard: Is the video done?
Chad: It's done but then I had some of my marketing people and some pediatric dentists and all of a sudden it's like someone's going to get offended with that. So I had to edit out a lot of the stuff. So we poked fun of millennials, not in a mean way, but then I showed it to the millennials, “That's going to offend millennials.”
So we toned it down. I think it's still funny, but at some point way later on, I will show the raw, unedited version that's pretty funny.
Howard: Give me the raw, unedited version and we can put it at the end of this podcast.
Ryan: The edited one is the one I sent you this morning.
Howard: That’s the edited one? But the thing is with comedy, it's all context, like you'll go to a dental seminar and I'll give my lecture and always someone finds it offensive and then I'll go to a comedy club that night after the lecture while I'm in that town and they'll say, “Well, that's the cleanest act. You didn't say the F word, no nudity, no vio-”
I mean you go to a comedy club and it’s just F, F, F, everything is sex, sex, sex, and then you go to an R-rated movie and you got topless people dropping the F bomb. Then you go to a dental convention and say, “Why do Mexicans take Xanax? For their Hispanic attacks.” Get it? It's a pun on panic attacks and “My sister's Hispanic”. They’re so… And the thing that really is even funnier is comedy never works in the country you were born in because it's so culturally overtone that jokes don't work.
When I lecture outside of the United States and Canada -- Canada is just the fifty-first state -- there's no jokes. It's just purely information because no joke will work because they're so loaded with so much emotion and craziness.
I'll give you one more example of Asia and the United States. In America, Saudi Arabia, Israel, you show a movie like Rambo where it's a manmade AK-47, you kill a hundred people, it's a family film. They take their whole family to it but if the mom who's a mammal gives birth to live young shows a mammary gland, oh my God, it's rated R, X and they all run out of the theater.
Asia, it's reversed. They actually think it's like kind of vulgar to see all these machine gun thing and that's what scares me because I haven't had lunch and dinner and breakfast in fifty countries with dentist and they say things like that America kind of scares them because they're afraid of nudity when every animal in the zoo's nude. But they just love to see a film with hundred people shot down with a machine gun.
So many dentists say that you guys have a very violent culture and I'm like, “You think?” Texas has more guns than people. Does Australia have more guns than people? Does New Zealand? I mean, it's a very violent culture, but they're afraid of mammary glands. It's like, how can you be, you think you're so macho and you're afraid of a mammary gland.
Chad: It's where we live, Howard.
Howard: Have I crossed too many lines? Am I making my own guest uncomfortable? But yeah, culture is bizarre and we might as well not talk about it because once they're twenty-one, their brain is steel-trapped shut; they're not open to all the stuff like that.
So what is a 3M stainless steel crown costing today and what is an Acero stainless steel crown costing? And then do the same thing if it's laminated for aesthetic.
Chad: Yeah. I can say this, I'm the only manufacturer that makes stainless steel molar metal crowns and aesthetic veneered stainless steel crowns.
Howard: And what's the aesthetic veneers? Is it a composite or?
Chad: Yeah, it's a stainless steel with a resin composite veneer, which is another subject and that came up about, I finally got that project off the ground about four years ago. It was the same concept as a Medicaid provider, there was a social stigma against having your kids have stainless steel in the front teeth because they were (00:32:12 unclear).
Years ago, that's all there was so nobody cared. You get kids, you put stainless steel in the front teeth, nobody cared, but now you have moms going, “You're not going to put silver in my kid” and so what's the option? Well, there was those aesthetic. Also, there’s Kinder Krowns, EZ-Pedo, New Smiles and all but they were like $22 for one crown. You can't do that with Medicaid reimbursement. You're getting paid $68 and you're going to pay $22 for a crown that leaves you forty bucks, $46? It doesn't make sense.
So with that same drive that I pushed for stainless steel crowns, I said, “We've got to be able to make these crowns and be able to provide it to the dentists at a lower cost so that even Medicaid children can get aesthetic white crowns.” So same thing. They go, “What drove you to do this?” Well, that. I wanted to provide Medicaid dentists the ability to do aesthetic crowns because they're not going to do white crowns because they can't afford it so we came up with that.
So the current market, you've got the metal crowns which 3M dominates and then there's also Hu-Friedy, Hu-Friedy came into the picture. So you’ve got Hu-Friedy and 3M and on the aesthetic side, you've got a bunch of independent family-owned companies that sell direct to dentists.
Howard: And those are New Crown?
Chad: Those are like New Smiles and Kinder Krowns and EZ-Pedo (00:33:28 unclear). So I've got, I wouldn't say a battle, but I've got two eight-hundred-pound gorillas on this side and then I've got a whole another group of competitors here because they don't really cross each other. These guys don't make metal crowns and 3M and Hu-Friedy don't make aesthetic crowns, but I make both so.
Howard: So what's the price difference? Between the metal in teeth (00:33:53 unclear)—
Chad: So if you go by Henry Schein or Pearson Darby, I think the retail price for 3M crowns is $42? $42.95 for a box of five.
Howard: So $43 for five. So much is that? What’s forty-three to five?
Chad: It’s like $8 in what? $8 and twenty-five cents.
Howard: And what is yours?
Howard: No, per crown.
Chad: Three sixty? Eighteen divided by five, is that three sixty?
Howard: $3 and six cents.
Chad: Yeah, I think.
Howard: So theirs is eight bucks, yours is three and a half and then do the same thing for aesthetic crowns.
Chad: The aesthetic crowns, when I sell to the dealers, now dealers offer discounts and I can't tell the dealer—
Howard: But you sell direct?
Chad: No, I sold direct through one exclusive marketer so in a way, it's a little bit confusing. For me to break in, I had to sell direct so we were selling. But as Lewis introduced me to dealers, I only sell through dealers now so Midwest, Atlanta, Practicon.
Howard: Do you think that's an idea, though?
Chad: I can always sell direct, there's nothing that forbids me from selling direct.
Howard: Because there's two strategies. What percentage of supplies you think move direct in the United States versus through dealer?
Chad: What percentage?
Howard: Yeah. What percent of supplies go direct?
Chad: Well, Amazon and all these, but I mean initially without having all that, I would easily say less than 10%.
Howard: It's about twenty.
Chad: Is it? I mean other than Ultradent, who else sells direct?
Howard: Ultradent, Denmat, Centrix.
Chad: Small players!
Howard: Right. 80% go through a middleman and 20% go direct but God, I mean Ultradent. That guy’s got a thousand employees doing a hundred million a year. So does Denmat, so does Centrix. I mean there’s a ton of them, but they're all small but they add up and what the dealers have done, which is very smart because my dealer does it.
She tells my assistant, she says, “Well if you want to buy direct, that's totally great and cool, but you could still just give me the order and I’ll purchase it.” I’ll do it for you because they want the data. So your Scheins and Pattersons and Burkhart's and Bencos are saying, “Oh, I'll make it easy, I’ll buy it from Ultradent, Dentrix and all these companies” so then headquarters looking at that stuff, “Okay, this is what they're buying. What do we need to focus on?”
Chad: I mean that's a question I live every day.
Howard: Gloves is another huge direct, it's a big cost.
Chad: Well, that's what everybody's watching, right. At the end of the day, I mean there's a bit of frustration as a manufacturer. You're marketing your product and then just handing over to the sale to the distributors. But a distributor like Midwest and Practicon, I like them because they do help market my product as well, but then there's other ones, the big behemoths that say, “I'm not going to do anything. I'm just going to take my cut.”
Howard: So you’ve got like me and you sell ads in a magazine because what we do is I have a media company, I have a Dentaltown magazine that goes to a hundred and twenty-five thousand dentists every month. The best advertisers are the ones that sell direct like labs and direct because if 3M has an ad. Like 3M will say, “Okay, we sold a billion dollars last year,” but they don't know which dentist bought what. But when people who sell direct buy an ad, they use a special number. So then they might place an ad in four different magazines, four different numbers.
I was having lunch with one of my attorney friends about six months ago and he's so busy and I always laugh at him because he's got the back of the phonebook, the billboards, the TV, everything has the same phone number because he's got the thing. I said, “Well, how do you know if they're calling from the billboard, the TV, the phone book?” He goes, “I don't know.”
So that's the biggest joke in advertising that 50% of the advertising is amazing and 50% of it is useless, but no one knows which 50% does what.
Chad: Well, that's the big debate, Howard.
Howard: So then here's another thing I want to do from philosophy. It's not right or wrong to sell direct or through a dealer, get right and wrong out of your head. It's everything has a trade-off.
So try to look at things from an economist and a mathematician. You're a dentist, you should be a scientist. So it's not right or wrong, it's what's the trade-off? What's the pros and cons?
Chad: So when I ran South Texas, one of the reasons why we did buy from Schein is because you don't want to have three million invoices. I want to buy everything in one shot. When you get to thirty-seven, forty offices, you want to have one go-to stop. You don't want to go buy bananas at this place, milk at this place, you want to go to a grocery store and just buy your groceries.
So that has a little bit to do with it, but at the same time as a manufacturer, you do get frustrated because you're just kind of you've got to market your own product because Schein’s not there.
Howard: Have you talked to Stan Bergman?
Chad: I have been in meetings with them, not directly. I mean, I'm not big enough to get his attention.
Howard: Oh, you are, too. Stan makes a religion of availability. I've noticed that all the successful people make a religion out of availability.
Chad: I’ll tell you, Brad told me a story when he went up to what's it Melville, New York and he says, “I was meeting with somebody.” He said, “Stan came in and say, “Hey Brad.” Or he was meeting with Stan or something like that and Brad told me, “Chad, don't ever forget this. Stan told me that basically the bottom line was, I'm not going to market, do anything, I just want my 40%,” which is harsh, but that's basically, they're not there to promote your product, they're there to—
Howard: They're publicly traded.
Chad: They want their 40%.
Howard: So here's what I would do. You came on the show. How do my homies try—you got a sample size, sample box? Your website is acerocrowns.com. Acero is A-C-E-R-O Crowns. Acero which is Spanish for steel. So they go to Acero Crowns, do you have like a starter pack or what did they?
Chad: It’s information and they can go to any of the dealers that are listed on there, but if they just email me, support I answer every—
Howard: See, you can’t call them dealers, you’ve got to call them distributors because every time you say dealers, the millennials are thinking, you mean the lady that sells me weed and they're all confused.
Chad: But if they send an email request, whatever, believe it or not Howard, I read every single one of the emails.
Howard: What is your email?
Chad: My personal email is going to be firstname.lastname@example.org.
Howard: Another friend of mine who's a dentist named Park is the owner of MegaGen, Dr. Park who's been on the show.
Chad: And allow me to just say please don't ask me, “Hey, do you know him?” Do you know how many parks are in Korea?
Howard: But you realize that he might be able to sell these in Korea?
Chad: Absolutely. I have a dealer in Korea, the only thing is that Hu-Friedy, their crowns are from Korea.
Howard: They're made in Korea?
Chad: They're sold in Korea. The Korean company is basically a private label for Hu-Friedy.
Howard: So Hu-Friedy’s crowns are made in Korea so that’s a big advantage?
Chad: I don't know.
Howard: By the way, one thing you and your wife might want to do is guess what my project was for Dentaltown this year? So the Dentaltown website, we spend an entire year reformulating it so now we can take that and I mean, we've been programming for twenty years, it's a half million lines of code. It’s an amazing computerized message board format system which I think is where you have to have, if you're going to Facebook, Twitter, email groups, LinkedIn, Instagram with this endless unorganized newsfeed is great for entertainment, but it's not to teach you how to do a root canal.
But now starting January 1, we can cut and paste the entire Dentaltown community so you could start a Korean town and your wife could start a Taiwanese town.
Chad: Well, my wife had actually found a Dallas Asian Dental Association and it's a group in Dallas. She was the founder first president then I was probably the fifth president, I believe and each president adds something to the organization and when I was, I want to get DADA to become a 501(c)(3) and we got that.
So we have a Dallas Asian Dental Association; it's camaraderie, mutual learning, giving back to the community. I don't know if that has something that can partner up with Dentaltown, Koreatown?
Howard: Because there's people who, they're starting to realize that they start these Facebook groups and they haven't even figured out yet that Facebook even tells you in their public information there. When you make a post, only like 3½ % of the people are going to see your posts. People in their walnut brain think they make a posts and they have five thousand followers at five thousand are going to see their posts. No, not unless you boost your posts.
So when you put all your time and money on someone else's platform, you're at the mercy of their platform. Whereas, if you host your own website, you control it and then what's also great is you can do it with no ads and so we just want a deal where if you make a post, everybody’s going to see it.
But I fully expect people to start all kinds of their little splinter groups because people are very tribal in nature. Like if you're a pediatric dentist, maybe you just shouldn’t homie with other pediatric dentists, you have no desire to listen to oral surgeons and general dentists and Medicare, you just want to be.
So when I go around the world like dentists will tell me from Cambodia and Malaysia and all those countries that yeah, they love Dentaltown, but it's America and people don't get it that it's just so different in Cambodia or Vietnam. So they've been asking me for years to make a Dentaltown for their country. It's like well, I don't want to started Dentaltown for Cambodia, I'm not Cambodian. I mean, how the hell am I going to do that?
But so what I'm doing the technical software hosting deal and I’ve got five programmers working on this all year. They're all making all these automated I don't know what it's called but.
Chad: How do you give, let's say, a Dentaltown in Cambodia? How do you give it that foreign splash of spice?
Howard: Well, if you're the Howard friend of Cambodia I mean, I'm sure that Cambodia has got one short, fat, bald dentist. They can't be old, tall, dark and handsome in Cambodia.
Howard: Well, yeah, I think a lot of people are going to do that. It's so funny because dentists tell me all the time, “Yeah, I'm on a Facebook group there's seventeen thousand people and I put those cases.” It’s like, okay, so when you post a case on a group of seventy thousand people, how many people you think saw it?
I mean, if you talk to the owner of Facebook, he can tell you 3% max unless you give them money and they're publicly traded. That's why investment advice for social media like, if you give Facebook a lot of money, buy Facebook stock. Have you ever given Twitter a dollar? No, that's why I wouldn't buy their stock. Twitter's IPO price, their stock, it came out in the market like forty and immediately fell in half. Have you ever given Snapchat money? No. So why would you buy their stock?
Warren Buffett said all the time. Beating the Street by Peter Lynch, it's like people would ask Peter Lynch like, I remember when the big chain was rolling out Boston market. They would say, what do you think about Boston Market stocks? He said, “Well, first I want to know what you think of Boston Market? Do you eat there? Does your wife eat there? When you go in there in your neighborhood where you live, is it busy? Are people saying, I love this food?”
Don't talk to a Wall Street broker. The guy who made the most money in Wall Street lives in Omaha, Nebraska, and he doesn't give a rat’s rear what a stockbroker thinks. So when In-N-Out Burgers or Boston Market or—
Chad: Booyah Burgers.
Howard: Yeah. I mean, I still think to this day, Texas has the best ice cream on earth and who's that? Blue Bell.
Chad: Well, even after that disaster of tainted whatever, they've recovered just fine.
Howard: Yeah and so did Chipotle and all that stuff and it's always going to happen because for all you know, I mean, you can't have a full-proof like, they'll throw a billion dollars of lettuce away because of bacteria. Then I go talk to the farmers, do you know what the farmers say? “How can we have bacteria? We have javelina and deer walking through our farm fields pooping.” And then what would happen if they started shooting all the deer and javelinas? I mean, so it's always going to happen.
But man, I can't believe how long we went; we went an hour and a half. Shit, we went almost two hours. But it's acerocrowns.com, his email’s chad.park.@acerocrowns.com. Help a homie out, give it a try. I mean, it's a business so give it a try. Here's my five finger rule: is it faster, is it easier, is it higher quality, is it lower in price and does it get miniature over time?
So you look at when they first invented the steam engine, it was so big it can only suck water out of flooded coal mines in England, but as time goes by they get faster, easier, higher quality, lower cost and smaller. So when it got small eventually, it fit on a boat and you started the whole steamship business and the canal building and then it got smaller and smaller and finally was on a train. So if it's faster, it's easier, it's higher quality, it’s lower cost and miniature playing here for the big tray set up where you knock it and a hundred crowns fall on the floor.
Then when you look at the price of those crowns, do you know how many times in thirty years I've tried on three different sizes before I went with the final crowns? Routinely, the first one doesn't fit and I got to change sizes or whatever. But I think you and your wife should be the poster child for tearing down the Department of Immigration and opening back Ellis Island.
Thank you so much for voting with your family coming to this country and for all you've done. I think you're the all-American family and thank you so much for coming on the show.
Chad: Thanks, Howard. Enjoyed it.
Voiceover: Finally, your last appointment of the weekend, check the schedule. Really? A double pulp crown Friday at 4:00 PM? Does your staff hate you? “You're so great with kids,” they said. “You should be a pediatric dentist,” they said. Why did I listen to them? And look at princess here, I'm sure she's going to be a joy. Oh no, blue sucker. Well, I'm sure at least mommy's a calm, rational human—
Mom: Are you okay? Is this bad man trying to hurt you? Do you need your Sippy Cup? Are your peanut allergies acting up again? Do you have peanut dust on your hands?
Voiceover: But what are you worrying about? You've got a brand new assistant. I'm sure she'll be super helpful here.
Assistant: Oh yes, I need like the next four months off. Dustin and I are like starting a travelgram so…
Voiceover: You've got the golden window. Maybe ten minutes to get this double pulp and crown down before princess has a class three meltdown or this overprotective mom throws you through a window. Pulps are done, teeth are prepped, let's see some crowns.
You asked your assistant for an L3 and a K4. Pretty easy request, right? But with this crown tray layout, you may as well be speaking to her in Russian.
Doctor: (speaks in Russian)
Voiceover: Sorry, but McKinsey has no chance of finding the crowns you actually need. Princess is about ten seconds from going nuclear and helicopter mom is well, yeah, and your golden window is closing. You go to grab the crowns from the tray since Selfie Girl doesn't speak Russian when suddenly- Oh no! I should've gone with Acero.
Acero Crowns were designed and developed by dentists for dentists. With a user-friendly tray layout and simplified universal numbering system, Acero Crowns actually correspond to the tooth number. So even that brand new dental assistant you hired on Tuesday will have no problem getting you what you need. And not only are Acero Crowns so much easier to use, they're almost half the price of the other leading brands
Acero Crowns also come and white with lifelike translucency so princess can keep that beautiful smile for all her photos.
Doctor: Thanks so much for coming in. You've got a beautiful set of teeth in there. I think we're done. Thanks for coming in. Lay off the Diet Coke! Say hit to your husband!
Mom: Are you okay?
Doctor: So go to acerocrowns.com today and see the difference for yourself!