During a time of inflation, staff shortages and increasing DSO presence, owning a dental practice brings with it numerous challenges one should consider before taking the leap to acquire or open an office.
Here, five dentists share what aspiring owners should know before opening their practice:
Rajdeep Randhawa, DDS. Innovative Dentistry (Rahway, N.J.): First and most important is do they have the clinical, management and business skills to independently own and operate their own dental office? Do they have the financial reserves or resources to back them up while they are building their own practices to a full schedule? Are they ready to pay for office overhead, their own expenses and all the loans they are servicing while the practice is not providing adequate income? Are they making the mistake of opening a dental office in an oversaturated area, where a large group of dentists and DSOs are chasing a small group of patients? Do they want to do insurance-dictated dentistry by being a participating provider?
Do they want to run high-overhead, high-stress, low-profit, insurance-participating offices that are called revolving door offices? Are they willing to go to rural areas where retiring dentists for lack of replacement are just closing their offices, and there is no lack of patients?
The pandemic is causing stress and burnout leading to supporting staff changing their profession altogether and going into jobs that pay better wages and benefits. When they buy an existing dental practice, do they have the skills similar to the dentist selling the practice in terms of doing the procedures that are his main sources of income? Do they have the right communication skills when it comes to dealing with team members and patients? Are they really good at attracting and retaining the right kind of patients? Can they provide leadership and assemble the right team to provide best dental services to their patient base?
David Keller, DDS. Granite Dental (Vancouver, Wash.): You have to have a solid business plan. To secure financing at good terms, this will likely be in place. But you also need a good business plan B for things like COVID-19, maternity leave, team members who decide to move and all the other things that pop up in clinical practice.
You need to have a solid plan for working on your practice, not just working in your practice. Regular dedication to your practice will pay more dividends than adding hours to your practice.
You need to start your practice with a transition plan in mind, and work that plan. If you want a partner or associate, have a plan for when and how. If you plan to work 30 years and sell, understand what that means for how and when to take out loans, purchase versus lease equipment, add versus drop insurance plans, etc.
Most important, find mentors, become vulnerable and ask for help. Other dentists, in general, want you to succeed. Let them help you do so.
Rick Mars, DDS. President at Dental Care Group (Aventura and Pembroke Pines, Fla.): Have a plan. The plan can change, but if you want to be an owner of a practice, are you willing to make the sacrifice? If not, maybe an associate role is perfect for you. You need to know what you want and that should be your starting point.
Oksana Boyechko, DMD. Boyechko Dental (Cameron Park, Calif.): We were taught in school that location is most important in opening your practice. I want to emphasize: not the location of the practice, but the location of your home. That is the most important. One needs to pick first the place to live, to have a family and be happy first, then look for the place to open the practice, near home. Also, start small: two operatories, doing your own hygiene, having only two employees, so as not to get overwhelmed. Try not to start many projects at once, like buying a house, car, and/or equipment for practice or learning several new procedures at the same time, like placing implants and doing 3D printing, etc. Pace yourself, accomplish small things, then move on to the next. Don't forget about the family and the loved ones!
Michael Davis, DDS. Smiles of Santa Fe (N.M.): The non-dental services that numbers of the DSOs handle and claim to be extraordinarily difficult are anything but. You can retain the services of a bookkeeper, payroll accounting, etc. for minimal cost, or do it yourself. You now collect and keep the profits of your dental practice, while building equity in a business. You're positioned to obtain the equipment and supplies that best serve your (not the corporation's) patients. One is also situated to serve fairly within the doctor/patient relationship, without non-disclosed intrusion of the third party (DSO).