Why Practices Don’t Sell
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.
4 Interesting Things to Implement So Your Dental Office Runs Smoothly
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 MoreAdvice for Dentists Who Are Thinking About Selling Their Dental Practice
For Dentists who are considering a practice sale – Here is some advice from an experienced Practice Transition Advisor – Megan Urban, Omni Practice Group.
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Top 5 Fears Veterinarians Have About Practice Ownership (And How to Overcome Them)
By Rod Johnston MBA, CMA, and Jim Vander Mey, CPA, ABI
There are many advantages to owning a veterinary practice over being an associate veterinarian and not owning a practice. For one, the average veterinary practice owner makes approximately 20% more in income than an associate veterinarian working for someone else. A veterinary practice owner also gets to choose what procedures he wants to perform and what type of animals he or she wants to work on. Heck, they even get to choose which animals they want to work on. They can also choose their own hours, pick the days they want to work, and how much vacation they want to take. So, why aren’t veterinary associates owning practices? What are they afraid of? Here are a few fears we have encountered and how to overcome those fears:
- Fear of the unknown – Associates feel they don’t have the experience in owning a practice. They haven’t managed staff. They haven’t kept financial records. They don’t know what marketing to put in place. They don’t know what benefits to give employees, how to hire or fire employees, or even how to balance a checkbook.
Fear not, you don’t have to know everything at once. You know how to do veterinary medicine. That’s the first step in owning a practice. You have a few years of experience working as an associate in a veterinary practice. You’ve observed the owner working with and managing staff. You may have experience leading a team in school, playing sports, etc. These are all examples of good experience in handling staff. You don’t have to know how to keep books right away. We suggest getting a veterinary bookkeeper and then getting educated on reading financial statements. This can happen over time. Bottom line is if you are good at what you do and willing to learn the other parts of practice ownership, you’ll be just fine. - Fear of taking on more Debt – Read Robert Kiyosaki’s book, “Rich Dad, Poor Dad”. Not all debt is created equal. There is good debt such as student loans and practice debt that helps generate an income and there is bad debt such as credit card debt where you just borrowed money because you wanted something. Practice debt used to buy a practice that will help you make more money and build equity in an asset (the practice) is a positive thing. As long as it’s a good practice with good cash flow, you’ll be money ahead in the long run.
- Fear of the Corporate Giants – Don’t fear the corporate giants. They have their own niche targeting bargain shoppers and lemmings who follow the crowd. They also have a high turnover in their staff and doctors. You will provide excellent service with the same staff and veterinarian that the clients will see every time they come to your office. In a corporate environment, they’re not sure who they’re going to get.
- Fear of not knowing what to look for – This is a valid concern. You can educate yourself in a number of ways. There are great resources via podcasts, YouTube, etc., that can help you know what to look for. Quite simply, you start by looking at your desired location, then look at the cash flow of the practice and after that, you can get into the details. There are consultants and brokers who can also help you with reviewing practices. Identify your team that will help you overcome this fear.
- Fear of a recession – Recessions happen, typically every 8 to 10 years and last 10 to 12 months. You cannot avoid recessions or downturns in the economy, it’s part of life. But, during recessions, employees typically get laid off from work. If you own your own practice, you’re probably not going to fire yourself. You’ll probably keep yourself employed and busy. Owning a practice is a deterrent from getting laid off during a recession.
These are a few of the fears that we’ve seen over the years, and there are others as well. But, the best thing you can do is educate yourself and talk to practice owners, brokers and bankers. Seek advice and counsel from everyone you can. This will help you make a wise decision in moving forward with practice ownership.
Read MoreGetting Your Practice Ready to Sell
By Cindy Pauley, DDS & Practice Transition Advisor, OMNI Practice Group
You are ready! You woke up one morning early last week and said to yourself, “It’s Time!”
You have loved being a practicing dentist. But for a multitude of possible reasons, you are ready to sell. So, what’s next? You look around and think is my practice ready to sell? All of a sudden you see the chipped paint and remember the door that sticks if you don’t open it a certain way. Not unlike a house that you are putting on the market, some quick accounting of your practice is in order. Unlike a house, big and costly upgrades will not net you a higher sales price. So, let’s talk about what is a great bang for the buck and what may be money thrown out the window.
First, some really great things that don’t cost much. If your paint is chipped worn or aged… paint! Painting is simple, fast, and the quickest way to make a great first impression during the showings. Second, and advisably after the painting, upgrade flooring if it is worn or really outdated. For both of these options, go for smart clean colors. For the flooring options, keep it simple. Commercial carpet or carpet tiles and vinyl sheet or luxury vinyl plank (LVP) are quick to install and look great.
Second, fix all minor repairs. Doors that stick, duct tape on a hose, or worn fabric on chairs can be easily and inexpensively repaired and add to an overall feeling of a well-run business.
Third, declutter your entire office. It is time anyway. Put things you can’t part with boxes and get them out of the office. Otherwise, use your local goodwill and dumpster and let things go. Walk through the office as if you were going to buy this practice. You know that you would want to have clean, clutter-free spaces to visualize your future dental life in.
Even if you choose to postpone your sale, all the things I have just mentioned should be done if they are needed regardless, so it is a win-win! Your staff and patients will love everything mentioned and it is an inexpensive boost to the whole business.
Notice what I didn’t include? That’s right. I didn’t include any expensive dental equipment upgrades. Much to the dental supply company’s sadness, new dental chairs and a cone beam are not a good investment if you are planning to sell soon. Do not buy a new laser or a CAD CAM machine because big equipment purchases, with rare exceptions, do not pay for themselves when a sale is imminent.
Ok, you are all set. Now what? Well, give a practice broker a call in the meantime to start the valuation process. A side benefit is that we are happy to come out to your practice and let you know what we see as the best things you can do prior to listing. Be ready for the answer to be that nothing needs to be done. If you look around and think “it looks pretty good here”, chances are we will too.
My door is always open for consultations at any stage of your practicing life. I am always excited to help you navigate the pathway to your new life’s adventures.
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