Life is like a record album for those who remember what that actually is. It spins around and around, and once it gets to the end, it starts back at the beginning. Like the 70’s Rock Band, The Clash simply put it in the 1982 top 40 hit, “Should I Stay, or Should I Go”? The lyrics to the song could be how you see yourself in your practice. A lot of give and take and one day it is fine and the next it’s not. The business of Dentistry is very cyclical and almost everything we have experienced in the past 40 years has presented itself previously in some form or fashion. We always prevail, but do we have the time and energy left to do it again.
Do I stay? Keep everything as is and hope that the current pandemic is in the past. Will the new administration have my best interest in mind? Is my retirement plan fully funded and protected? Do I have the necessary resources available to make some modest investments into my business to maintain my year-over-year production and collections? These are just a few questions that you should be asking yourself.
Over this past year, due to Covid rules and regulations, offices were forced to clean up. For some, this was a bigger undertaking than others. Decades of clutter, dust and grime made it to the dumpster. Some offices got fresh paint, flooring, and some new equipment. Going to the office for some became a bit more exciting now that the office was feeling fresh.
Do I grow? In addition to the above, maybe you hire an associate if your practice can support one. Expand the facility if possible. Acquire an additional location. Build a new office and relocate the current office into that facility.
Now is a great time to take a deep dive into your numbers. Most practices monitor production, collection, new patients, and the accounts receivable. What is your practice mix? Most general dentists perform around 90 unique clinical procedures. The more procedures you offer, the less dependent you become on new patients. What about your insurance plans and fee schedules? Are you taking advantage of alternative patient financing? Are you coding correctly?
Take advantage of the current lending rates. Interest rates are currently at an all-time low. A ten-year loan for $100,000 at a 4% interest rate is only $1,013 per month. Depending on what you utilize the proceeds for, there can be some significant tax benefits as well.
Do I go? If you’ve been saying 5 more years for several years, and just when things go bad, they soon start to recover, and then they go bad again. There will always be something around the corner. As you and your practice age, the profitability, marketability and transition ability all slide up and down.
Keep in mind that a transition typically takes up to a year to complete. The location may greatly affect that timeline and if you are a specialist or if you do a good percentage of specialty procedures, that may not only affect the timeline but also the market value.
Before you choose any path above, you should consult with one of our ADS Dental Transition Brokers. With the experience and expertise we have from coast to coast, you’ll be well informed and advised to make that very important decision.
Doug Sellan is a transitions consultant with PMA Practice Transitions and a member of ADS. He began his commercial banking career in 1987 and has over 30 years of experience in the healthcare industry.