The 3 Stages of the Life of a Dental Practice
More articles in the 'Starting a Dental Practice' section:
- Starting a Dental Practice
- 5 Key Steps to Starting your Dental Practice
- Choosing the right practice or starting one up
- Creating a business plan
- How Easy is it to Start, Scale or Sell a Dental Group?
- Putting a team in place
- Registering with the Care Quality Commission (CQC)
- The 3 Stages of the Life of a Dental Practice
- Why Dentists Want Their Own Practice
- Why start your own dental practice?
Step 1 – Setting up or Buying a Dental Practice.
If you’re at the stage of buying or setting up a dental practice, that is your first stage. If you are setting up a clinic, there are plenty of things you need to be thinking about. For instance, you need to consider the location, your budget, the type of dentistry you will be offering, as well as the type of patient you want to be attracting.
When beginning your journey as a dental practice owner, you have 2 main options. Firstly, you can set up a new clinic from scratch and we have a number of resources within the Learning Center that cover setting up a dental practice or clinic. Your other option is to buy an existing practice. Buying a practice comes with its own considerations such as; what are the current profits, where is it located, how is it performing currently, and, if you can buy that practice, how can you add value to it? In other words, if you buy it now at a certain price, how can you increase the value so that you can then sell the same practice in the future at a profit.
Step 2 – The Growth Stage
You may have set up or bought a practice that is now operating and performing fairly well. The truth is, however, that whether you started or bought your practice, your goal is to grow it. How do you accomplish this? There are several ways to grow a business, but you need to be smart about it. You need to ensure that you grow the turnover, without growing the cost at the same rate as the turnover. Therefore, you need to manage the costs appropriately to make sure that the margins of your business are growing at a healthy rate.
What do you need to grow your business? Firstly, you need to make sure you have the right team in place. Having the right team can make all the difference in any business. However, that team needs to have bought into your vision and they must understand what you are trying to achieve with your practice or your business. Secondly, your marketing has to be hot! We are living in an age of digital marketing, therefore, you need to be on-board with everything in the online world, whether it be YouTube, Instagram, Facebook, Pay Per Click marketing with Google, SEO etc. You need to understand these platforms to be able to grow your business. Growth is all about getting your marketing right, getting the team right and then implementing great care to your patients and customers. This is how you grow your business to a value that will ultimately help you on your exit.
Step 3 – The Exit Stage
You’re at the stage where you may have owned a practice for a few years, you have grown it healthily and it is doing well. However, you really want to exit at the top of its game, not when it has reached its peak and then started to decline. You need to be thinking about “when is the right time to be selling my dental practice or office?” The answer: when it is doing its best. At that stage of maximising value, where you have made all the effort at the growth stage to get a value that is healthy and profitable, this is where a buyer will come along and pay you a handsome price for it.