If you would have told me five years ago that I would become a private practice owner less than one year out of dental school, I would have thought you were absolutely crazy. Take it from someone who decided to have a baby, learn how to be a dentist, and purchase half of a practice all in the same year; becoming an owner dentist of a private practice can be stressful! Here’s a few ways to survive the whirlwind.
- Find a reputable consulting firm. There are many moving parts of buying or opening a practice! I honestly could not even imagine how we would have gotten our deal done without the help of a Transition Consulting Firm. They conducted our appraisal, directed and mediated all communication with bankers and legal teams, and finished our whole deal in the matter of only a few months (all during a time when interest rates were on an exponential rise). You need a practice transition consultant!
- Become an ideal loan candidate. Don’t do what I did and purchase a house and a truck in the same year that you are buying a practice. Luckily, there were ways around it, but I can assure you that all bankers are going to want to see at least $50k of available cash, a credit score above 700, and healthy spending habits. They’d also like to see evidence of a full year of promising production from you as a dentist. If not, then my next suggestion is an absolute requirement for you.
- Find a practice that makes it easier for bankers to give you a loan. As I just mentioned, I was not the most ideal candidate for banks to consider for a large loan. Getting the loan was my biggest stress because I was a new grad, had just made big purchases, and I had less than a full year of production to show for (and a six-week maternity leave of no production). I say all this for the people who don’t think that they can become practice owners because - even with all that going against me - I still got approved by several banks! The banks were able to approve me because my practice has enough hygiene production to pay for my loan. If you can find a practice that can assure the banks that you can pay your loan payments consistently then rule number two has a lot more leniency to it.
- Expect challenges with your team. Another one of the biggest stresses with purchasing or opening a new practice is the team. Whether you are choosing a new team or inheriting a long-existing team, there will always be people who don’t do well with change. Be patient and try to communicate as much as possible. Be reflective on critiques, but confident in your abilities. Allow time to pass for people to gain trust. Establish a clear practice mission and make sure everyone on the team aligns with those values. It will come!
- Dive headfirst into marketing and branding right away. Our practice has had a unique situation. The dentist I purchased from is still practicing occasionally, which has made our name and branding transition fairly slow. I can tell you from firsthand experience that the delay in changing names, branding, and making big announcements about change in ownership has been very confusing for patients. It has caused unneeded stress so I would highly recommend making the initial money and time investment in getting your new name, brand, and practice values out there as soon as you purchase that practice!
Becoming a practice owner has been the most challenging but rewarding endeavor I’ve ever done. It comes with a lot of stress and sleepless nights but has put me in a position where I can passionately and creatively provide for patients every day. Don’t be afraid to take the leap and know that even though it’s stressful, it is well worth it!