After a few years as an associate, you now want to be an owner. What are your options? Start a new practice, purchase a practice from a retiring dentist or buy into an established practice? You’ve heard all the stories, collected the appropriate information and received lots of advice about the different options available to a dentist ready for ownership.
Information is coming at you from all directions. Well-meaning people are giving you all kinds of advice. Don’t become a partner, partnerships never work, buy a practice of a retiring dentist, be your own boss, transition into a retiring dentist practice, start your own from the ground up etc. For some, answering the question about what will be best for you is as frightening as walking through a land mine. Remember, there is no right or wrong way. The most important thing is to decide what is the best strategy for you and get sound advice from people in the industry with proven experience.
When making this decision, it is important to consider all aspects of each option. Some important questions to ask are:
1. Will you enjoy the entire management responsibilities of owning a practice?
2.Will you enjoy taking full responsibility of all business decisions that are needed when you own your own practice?
3.Would you like to share visions and concepts with others or is it better for you to have total control?
4.Do you want to practice in a more rural setting, a bedroom community or a metropolitan area?
The following is a list of other things to consider when making your decision.
Sharing Costs Partnerships, be they cost-sharing or equity, allow a dentist to share costs. To manage a progressive practice means investing in technology, good equipment and well-trained team members. Technology is just one small part to the overheads in a dental office. Modern equipment, whether that means a computer system that will seamlessly integrate all of the other components in your office, air abrasion and intra-oral cameras are just a few tools that can be a big expense, unless you are sharing that expense with another dentist.
Management Historically, most dentists enjoy the dentistry but not the management part of running a practice. When you have a partner or partners the management of the practice is shared or it is profitable enough to have a full-time office manager who will handle the day-to-day operations for you. The manager will support you and your partners to achieving the vision and goals that are important for everyone.
Peer Support Clients say that it is great to brainstorm ideas with another dentist who may be down the hall. It may be a business decision or a clinical question, no matter what it is they enjoy the camaraderie.
Practice Coverage When sickness or tragedy hits a family and a dentist needs to take time away, it is a big relief to have a partner who can keep doing the dentistry and supervising the hygienist. When a dentist takes vacation or attends professional programs they are away from the practice, but expenses still need to be covered even while the same revenue is not being generated.
Full Patient Base When a practice is successful, it grows. When a practice grows and the patient base becomes larger than one dentist can serve comfortably, it is time to add another dentist. Becoming an associate/partner in a practice that can provide you with a good patient base is a great way to become an owner/partner, be busy and have good cash flow.
Disability Disability insurance is a great help when a dentist is on a short term disability leave. Much of the time, dentists are not sure of how long they will be unable to be in the practice. If the practice must be sold, many times the sale price is not what it would have been if a healthy dentist had the practice for sale. When you have a partner, the effect is more manageable and less traumatic for the dentist with the disability.
Flexibility An example of the need for flexibility is in the area of work schedules. Who will work what hours? Will the practice offer evenings and Saturday patient hours and who will cover those hours? Can you both be flexible enough to share, or is it more appropriate for one person to cover these hours because they prefer them?
Vacations and professional development time will also require discussion and flexibility. You will both need to communicate openly about what the protocol will be in this area, again flexibility and sharing will be important.
Agreements It is important to make sure you have a good partnership agreement in place that covers most situations — remember, it is costly to take a partnership apart. Use an advisor in this area that understands all the components that are important when structuring a partnership agreement. Partnerships take time to put together and they take time to take apart.
Communication A partnership will require more time for communication. You will need to meet on a pre-scheduled regular basis to discuss what’s going on in the practice. It will be important that the team feels that the partners are always on the same page.
Good Match It takes time to find a good partner match for a dental practice and it takes as much work and time as finding a good mate. If you are not prepared to invest the time, partnership should not be your choice.
Remember, there is no right or wrong way. You and only you can decide what works best for you. Don’t think short term — always make your decisions based on long term needs. Whichever direction you choose will be an investment of time, money and emotion.
Mary Ann Kindy is a certified management consultant with over 25 years experience, 18 years as co-founder and manager of an international consulting firm, past member of the American Association of Practice Management Consultants and is directly responsible for all associate placement services for Hill Kindy @ Transitions.