There’s no one way or perfect time to scale your dental practice. Whether you operate a solo practice that you plan to sell when you retire, plan to open new locations, want to expand operations at your current practice, have an interest in joining a group practice through a merger or acquisition, or already know you want to sell to a dental service organization (DSO), the right plan depends on your short- and long-term goals. The best you can do is gather all your information to see which opportunities present themselves. Here is a list of questions to help you understand what your next business move might look like.
Are you tracking your KPIs?
It's easy to get wrapped up in the managerial responsibilities of running your dental practice, but unless you're taking stock of the key performance indicators (KPIs) driving your business, you're likely missing opportunities to grow and diversify. While there are many ways to measure the success of your dental practice that dictate which business decisions to make, these quantitative results will help you improve profitability and increase efficiency.
Do you know your current ROI?
Purchasing a dental practice is no easy task, but it’s only the beginning of the hard work you’ll need to do to see a return on your investment (ROI). Whether the practice is new or existing, opportunity cost should drive all your post-buying decisions. Current loan payments, tax advantages and cash flow will all keep your ROI top of mind.
What value do you want to add?
Adding more dental practice locations doesn’t always add value. Owning multiple dental practice locations can affect your valuation when it comes time to transition, for better or worse. You’ll first want to crunch your numbers to know if you are able to staff both locations accordingly, while also planning for growth and refining your productivity.
Is there a demographic you want to reach?
The best way to ensure success when considering opening an additional location to meet demand is to tap into a new potential patient base. Focus your marketing efforts on new patients that haven’t already been targeted at a location that isn’t too close in proximity to your current one. Taking a look at your competition will help guide your decision and ensure the market doesn’t become oversaturated.
Will your staff support you?
The hiring crisis has certainly put a strain on finding employees to fill current roles while also devising a plan to retain current staff members and keep them motivated. If you find your dental practice is staffed mostly by temps and new hires, now might not be the time to consider an upgrade. Rather, focus your efforts on ways for your dental practice to overcome any staffing shortages.
What work-life balance do you want to achieve?
A paradox exists between being busy and feeling unfulfilled while being established in a career but needing an exit strategy. When owning your own practice, it can be easy to get lost in the day-to-day tasks and forget the clinical reasons you got into dentistry in the first place. Creating a comprehensive life plan that strikes a balance between personal and professional goals will help keep you on track for that elusive retirement while avoiding burnout.
Have you explored all your options?
Starting from scratch isn’t the only way to grow your dental practice. Consider strategies that involve either an acquisition or de novo startup, both of which have their perks, but understanding the consequences of either will ensure more pros than cons. Alternatively, consider merging your practice with an existing practice to get an influx of patients without the overhead of another office.
Bottom line
Even if you’re headed in the right direction, you don’t have to go it alone. Contact the experts at Professional Transition Strategies to learn the best way and time to scale your dental practice.