Did you reach your goals this year? Was one of them to buy a practice by the end of 2021? Ahem, it’s December. You know who I’m talking about! Do you remember when the year started back in January, and you said to yourself, and perhaps to some of your family and friends, “This is the year I’m going to buy a practice!” Well? What happened?
Did you know that on average a dental practice owner makes 20% to 25% more than an associate dentist? Practice owners also build up equity in their practice similar to owning a house. A million-dollar practice with no debt will give you a million dollars in equity. Did you know that most practice owners tend to be happy in their dental profession? Practice owners get the privilege of setting their own hours. They get to choose which procedures they want to do and which procedures they want to refer out. They also hire their own staff and let go of those that they don’t believe are doing a good job. Practice owners even get to pick out the music that gets played at the practice. Although, staff may overrule you on that last one.
We gave buyers a mulligan in 2020. Covid-19 hit us all pretty hard. I caught it early and it took most of the year for me to get back to normal. The industry reeled for a few months due to the Covid shut down and various mandates provided at the federal and state levels. But after the shutdown was over, patients came back. Practices came back with a vengeance. Offices that were collecting $80,000 per month prior to the Covid-19 shutdown were producing $80,000 or even more upon the re-opening. In 2021, I would say the majority of practices are back at full capacity. We can’t predict when this Covid craziness will go away, especially with a new variant popping up every six months or so. But we can say that dental practices are resilient.
Those of you who kept your goals and purchased a practice in 2021 are doing well. The practices they purchased are at least producing what they were producing prior to them acquiring the practice. They took out a 10-year loan and they are now 1/10 of the way to paying off their practice debt. Think about those who purchased a practice five years ago. They’re halfway to paying off their practice debt. If they purchased a million-dollar practice, they now have $500,000 of equity in their practice. A half a million dollars! I tell the story of a dentist who would come to our buyer’s seminars year after year. At year 7 this dentist came to our buyer’s seminar, and I called her out. I pointed out that if she would have purchased the first practice that I showed her 7 years ago with a 7-year loan, she would have had the practice paid off. The practice was a $950,000 practice. She would have equity of close to and if not more than $1 million if she would have just taken action. That motivated her to purchase a practice a few months after the buyer’s seminar. The practice she purchased was three miles from the first practice I had shown her 7 years earlier!
So, as we end the year and you start to think about your goals for next year, think beyond the goal. What can you do better this year that will help you reach the goal of purchasing a practice in 2022? Make finding a practice to buy a priority. In the not-so-long run, you will be thankful you did. The brokers at Omni are always available for a phone call to discuss what you need to do to purchase a practice. Just pick up the phone and give us a call – 877-866-6053.Read More
By Megan Urban, Practice Transition Consultant
Your practice has successfully worked for you for many years so why isn’t it selling? It could be the transition consultant (broker) you are using, or it could be your practice.
Working with an experienced transition consultant is important. We know where and how to advertise. It doesn’t work to simply advertise on a website. You will want marketing and advertising in schools across the country, dental journals, and county/state societies. An experienced consultant already has a list of potential buyers for your area or type and may have other creative grassroots ideas to find the right buyer.
The right consultant cares about you, your team, practice, and goals. It shouldn’t be just about the commission money. Your consultant should be responsive and professional to potential buyers and you.
A comprehensive valuation and prospectus are important. If you or your consultant price your practice too high, it can be offensive to potential buyers, and they won’t feel comfortable offering a lower price. Even if you find a buyer willing to overpay for your practice, the bank will not finance 100%, which means you have to become a bank for a specific amount of the purchase price.
Sometimes even when you have the right consultant your practice may have other reasons for not selling. Sometimes it’s simply not finding the right dentist at the right time. Often it is because your location is not desirable to new buyers and their families. Sometimes it’s the size of the practice. We all know 3 op practices can be very efficient and profitable, but many buyers want 4 to 6 ops, especially to add more hygiene.
Declining collections the last 3 years or simply low collections can be a deterrent to potential buyers and banks unless you have a reason. They understand more time off due to vacation or health issues. Low new patient count, too many PPOs with low reimbursement, and low hygiene production can be concerning to buyers.
Most buyers understand they may need to update style or equipment and technology, but if it’s a lot of cost and effort, they may keep looking for a better practice.
If your practice falls into any of these areas of concern, it will take more time than the average to sell. Lowering the price may help, but if there is no interest, it’s not the price that’s the problem. Don’t give up or get mad, just understand that while your practice may have been perfect for you, it can be a while to find the right buyer.
By Dr. Mehmood Asghar
When you walk into your dental office and see your staff members bustling around you, you might assume they are working productively. But your staff and employees are constantly trying their best to catch up with their daily tasks; they are just busy – not productive.
A successful dental practice is one where routine tasks are streamlined, and all processes run smoothly. If despite your best effort, you and your team fail to achieve your key performance indicator (KPI) goals, it is time to make some changes. Here are 4 things that you can implement in your dental practice to improve productivity and ensure that your training runs smoothly:
1. Invest in Good Practice Management Software
A practice management software is not just necessary for billing purposes or to manage patient records. Modern practice management software takes most of the burden off your team’s shoulders and automates various processes. For example, instead of writing individual appointment reminder emails to patients, the software can automatically send reminders and even reschedule appointments if needed.
Besides, with modern software, you don’t need to maintain your material inventory manually. You can simply assign a barcode to all the products, and the system will record the information regarding the quantity and expiry dates of each item. The system will automatically inform you if any material is short in supply or is about to expire.
Most importantly, good practice management software allows you to manage your finances – cut unnecessary spending and increase spending in areas that matter, like buying new equipment, refurbishing the waiting room, etc. The software will provide you with a detailed overview of your earnings and expenditures, and help you identify exactly where you’re leaking money.
2. Buy State-of-the-art Equipment
Being a successful clinician requires two major things: clinical expertise and the right armamentarium. Investing in modern diagnostic or therapeutic equipment will help you improve your treatment outcome, reduce treatment time and increase productivity. For example, it would be a good idea to invest in a desktop 3D printer: instead of waiting for 1-2 weeks for your lab to prepare a patient’s crowns, why not print them chairside in one day?
Fortunately, 3D printers are much more cost-effective today than they were a few years ago. According to research by SmarTech Analysis, in-office dental 3D printers, capable of printing surgical models, implant templates, clear aligners, and even dental prostheses, may cost less than $5000 by 2021.
You may also consider investing in 3D imaging technology. Today, dental implants have become the most favorable and desirable tooth replacement option. According to the American College of Prosthodontists, over 2.3 million implant-supported crowns are made annually in the US alone. With this considerable reliance on dental implants for tooth replacement, it only makes sense to invest in equipment that aids in implant therapy. Cone-beam CT (CBCT) technology considerably improves the clinical outcome of implant and other oral surgical procedures. Besides, this technology can also be used in the early diagnosis and management of oral disease and malignancies.
3. Automate Processes
Did you know that a significant time of your employees is spent in the sterilization control room? This is not because they are lazy; it’s because they have to frequently wash, clean, and sterilize dental instruments – either because of a small autoclave machine or due to increased patient flow. Regardless of the main reason, you can improve your team’s productivity by buying a fully automated sterilization system, which takes away the multiple, time-consuming steps involved in manually sterilizing the instruments. The initial cost of such equipment might be high, but it will prove a worthwhile investment in the long run, especially considering the time saved.
4. Staff Training and Workshops
While seemingly unessential, staff training and workshops to refresh/upgrade their clinical skills and enhance their expertise in inpatient/data management software go a long way in improving their efficiency. These workshops also ensure that all staff members remember their roles and responsibilities, thereby streamlining the work in your practice.
No matter how good a clinician one is, they cannot run a successful practice unless they are seasoned managers. According to the statistics provided by the American Dental Association, the average hours worked by dentists in 1900 were 1,810.6, compared to 1448.8 hours in 2020. This downward trend shows the impact of the latest technology and good practice management in increasing dental office efficiency, productivity, and earnings. So, follow the tips given in this article to convert your practice into an efficient, productive, and profitable business.
Author bio: Dr. Mehmood Asghar is a dentist, an educator, and a researcher in dental biomaterials. He is currently working as an Assistant Professor in Dental Biomaterials at the National University of Medical Sciences, Pakistan, in addition to pursuing a Ph.D. in Dental Biomaterials. Apart from his professional activities, Dr. Asghar loves reading, writing, and working out.Read More
OMNI Practice Group believes in giving back and doing our part by helping those in need. Holidays should be a joyous time of year but for some, it can be stressful, especially with the pressure of buying gifts for children and providing a special meal for your family.
OMNI is proud to announce our holiday giving campaign for injured combat veterans and their families. We are partnering with a wonderful non-profit organization called Everyone for Veterans (E4V).
Your monetary contributions will be collected and disbursed accordingly to those veterans who need a little extra help purchasing gifts, food, warm clothing, and other necessary items to get through the holiday season. The more we can collect, the more families we can help. Your donations are greatly appreciated and please help spread the word by sharing our link.
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For Dentists who are considering a practice sale – Here is some advice from an experienced Practice Transition Advisor – Megan Urban, Omni Practice Group.