Dental A Team with Kiera Dent
Dental A Team with Kiera Dent
Dentists, this is your playbook for building a practice that THRIVES rather than just survives! If you're ready to scale, streamline, or simply want to lead like a CEO, we're here to support you with our strategies.
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Dental A Team
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Selling? Build Dental Practice Profitability

Selling? Build Dental Practice Profitability

10/22/2026 7:13:00 AM   |   Comments: 0   |   Views: 19
A dentist can spend 20 years building a practice and only a few months preparing to sell it. That last-minute approach can limit choices. Dental practice profitability is built long before a buyer asks for financial statements, and the same habits that protect future value can make ownership easier today.

The conversation between Kiera Dent and practice transition advisor Brannon Moncrief highlighted a point worth discussing: preparing for a sale does not mean committing to one. It means creating a business with enough financial strength and operational stability to give the owner real choices.

Why Does Dental Practice Profitability Affect a Sale?

Dental practice profitability matters because buyers need to understand what the business earns after its operating costs, and whether those earnings are likely to continue. Strong collections are helpful, but revenue alone does not answer those questions.

Consider a practice that collects consistently but struggles with aging receivables, uncontrolled overhead, and frequent staffing gaps. The doctor may stay busy while actual cash flow remains unpredictable. A buyer reviewing the financials will want to see what has been collected, what it costs to produce that care, and which expenses are likely to continue after the transition.

Clean financial statements help. So does reviewing collections, payroll, overhead, and profit monthly rather than waiting until tax season. Dental A Team's guide to the numbers dentists should track offers a practical starting point.

Private Buyers Look Beyond Revenue

A private buyer often intends to become the treating dentist. That means the buyer is evaluating both the income available from providing clinical care and the cash flow generated by owning the office. This is why a traditional doctor-to-doctor valuation may differ from an investor's calculation.

Other details still matter. Operatories, location, equipment condition, payer mix, and the ability to add another provider can all affect interest in a practice. A beautiful office cannot make up for weak financial records, and strong revenue does not guarantee that every buyer can finance the purchase.

The most useful preparation is not an expensive last-minute renovation. It is a clear picture of the practice's recent performance, realistic upgrades with an operational benefit, and a transition plan that helps patients and employees stay supported.

How DSOs Measure Dental Practice Profitability

A DSO generally approaches practice earnings through an investor's lens. EBITDA, or earnings before interest, taxes, depreciation, and amortization, is commonly part of the analysis, with adjustments needed to account for expenses such as market-rate compensation for the selling dentist's clinical work.

The distinction matters. An investor is not planning to step into the treatment room and personally produce the owner's chairside income. Buyers want to know what the practice can earn after the clinicians and operating team are paid, especially when the seller eventually reduces clinical time.

A higher stated valuation also deserves a closer look. The proposal may include cash at closing, future payments tied to performance, retained equity, or a continued work commitment. Those pieces carry different levels of risk and flexibility, so the largest headline number is not automatically the best outcome. Dental A Team's discussion of questions to consider before selling to a DSO explores the tradeoffs.

A Full Schedule Can Hide a Quiet Decline

One of the most useful points from the interview was the risk of unintentionally winding down a practice before selling it. Fewer clinical days, lighter schedules, or declining collections may seem reasonable as retirement gets closer. Yet buyers often give substantial weight to recent performance, not the practice's best year from several years ago.

There is nothing wrong with deliberately reducing hours. The issue is making that change without understanding its effect on cash flow, patient continuity, and the eventual sale. An associate, stronger hygiene systems, or a planned ownership transition may create more flexibility than simply allowing production to drift downward.

The important question is whether the practice is following an intentional plan or slowly losing momentum without anyone measuring the impact.

Build Dental Practice Profitability Without Owner Dependence

A practice becomes harder to transfer when the dentist is the only person who can resolve routine problems. If the owner personally approves every scheduling change, follows up on overdue balances, and manages every team concern, a buyer inherits that dependence along with the patient base.

Better financial performance can start with ordinary operating decisions. Give the office manager clear authority, make insurance follow-up someone's responsibility, and review scheduling and collections against agreed goals. Document how the team handles patient handoffs so the process continues when a particular employee is absent.

These improvements have value before a sale, too. Better delegation can reduce interruptions, clearer ownership can protect production, and consistent reporting can help the dentist address problems before they become expensive. For a related approach, see Dental A Team's article on improving profitability without cutting the team.

Keep Dental Practice Profitability on Your Terms

Planning several years ahead gives a dentist time to compare a private sale, an associate transition, and a DSO affiliation without having to rush. It also allows time to clean up financial records, strengthen key leadership roles, and make improvements that can pay off during continued ownership.

Before discussing an asking price, it helps to have a dental-specific CPA explain normalized cash flow and an experienced transition advisor outline realistic deal structures. An attorney can review obligations after closing, including future employment, deferred payments, and equity provisions. The right choice depends on lifestyle goals, desired timing, and how much risk the owner is willing to accept.

Dental A Team helps practice owners build the financial visibility, leadership, and operating systems behind those options. If you'd like help improving the business before deciding what comes next, schedule a call with our team.

A good first conversation is about the practice you want to own, not a sale you have to make.

For more tips, check out our podcast.

Clients see up to a 30% increase in revenue

Last updated: October, 2026
Category: Ethics, Jurisprudence and Malpractice, Financial Planning and Investments, Office Design, Practice Management, HR and Accounting, Practice Transitions
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