Business side of dentistry: Looking for a practice in the area
Editor’s note: This is the third article in a series exploring the business aspects of the dental profession, from starting a practice and marketing to hiring staff and finances.
Once you’ve decided which location you want to be in, finding a practice becomes the next big step. There are two ways to think about this: having an on-market strategy and an off-market one.
1. Make a list of all the brokers in the country who sell practices in your location. Ask other dentists, your dental society, vendors, dental specific accountants and mentors which brokers they have heard of or worked with the past, to make a comprehensive list. I was surprised to find that in the Pacific Northwest alone there are almost 15 dental brokerage firms!
2. Go on their websites, browse existing listings, fill out their NDA form, send an email introducing yourself (always attach a resume) and tell them exactly what you are looking for (how many ops, gross production of the practice per year, ideal location and square footage).
3. Most brokers are extremely busy. Respect their time and don’t ask for a phone call, unless they suggest it. Demonstrate your preparedness and focus around buying a practice. If you have pre-qualification from a bank, share it. Otherwise mention that you’ve spoken to a few interested lenders and are ready to proceed with an acquisition ASAP.
4. As the founder of the New Dentist Business Club, if there is one thing I have learned over the last year, it is the importance of a follow-up. If nobody responds to you at first, wait a week and follow up. I usually do two follow-ups before trying again in a few months. Usually, the three-email follow-up strategy rarely fails.
5. Many dentists think the above strategy is the only way to find a practice to buy. Relying on this strategy can easily become frustrating because you are waiting for the right opportunity to come along. Don’t be that person who is constantly waiting for things to happen, get into the active seat. Read below for a second strategy!
1. Make a list of all the dental practices in the community you are interested in. This can take several weeks for you to compile.
2. Go to their individual websites and look up the graduation date of the dentist. Most bios will mention which year they graduated in. The purpose of this exercise is to evaluate if the owner dentist of the practice is 55+. Most dentists retire around age 60 or 62, some dentists like to retire sooner, others later.
3. PRO TIP: A lot of new dentists even find associateships this way!
4. Narrow your selection even further by doing a drive by on those chosen practices. Are they in a location you like, with good visibility? Do you see your family living close by?
5. Narrow your selection more by looking at how many hygienists are employed by the practice. Usually if there are more than two or three hygienists, the practice might have a robust recall rate amongst patients.
6. If you’re not able to gauge the age of the dentist, the website: healthgrades.com could offer you that data.
7. Create a letter for the practice owner explaining who you are and mention your professional goals and vision for the future. Let the reader know you’re interested in buying a practice! Are they looking to sell in a few years? Let them know you’re also looking for mentorship. Would they like to have coffee with you? Would they be open to a short phone call? You can link this letter to a personal website with photos of yourself and professional skills listed.
8. PRO TIP: Attach a photograph of yourself and your family, it always humanizes you and makes you look like someone they can connect with.
Does all of this work?
YES, it can.
I followed the above strategy for a full year. Here are some of the things that happened as a result.
1. On-market strategy: I was emailed about at least five practices by brokers before the listing went live on their websites. All of the practices were in my desired location. Getting those emails meant they knew I was serious.
2. I was contacted by at least 10-15 dentists as a result of my mailers. I didn’t send a whole lot, just a few chosen ones based on extensive narrowing. Three of them were interested in selling. Two of them were looking for a long-term associate that would culminate in ownership. Others called me to thank me for my letter and invited me to their office for coffee. Every single person was incredibly nice and gracious with their time.
3. Remember that the dentist and dental vendor community is extremely small in any city/town. Be kind to everyone. Help others when you can. Remain humble and gracious, it’ll go a long way in cementing friendships.
Go crush it!!!
Dr. Sampada Deshpande is a general dentist based in Seattle. A foreign trained dentist from India, Sampada earned her DDS from the University of Washington in 2018, where she is also a current LEND trainee. Outside of clinical dentistry, she enjoys teaching at the New Dentist Business Club, biking with her husband, and reading books on Finance & Management. You can reach her directly at @dr.deshpande on Instagram or visit her website www.sampadadeshpandedds.com for more information.
Editor’s note: We know that finding the right practice can be overwhelming and time consuming. That’s why the ADA created ADA Practice Transitions (ADAPT), a service that matches you with practices that fit your practice approach and lifestyle. We provide customized resources to ensure you feel confident in your decisions and an ADA Advisor supports you during each step of the journey. Learn more at ADAPracticeTransitions.com.