By: Bruce Bryen
After getting out of dental school and going to work as an associate at a dental practice, the feeling of having learned what was available to digest at that practice now seems like it has been fulfilled.
It seems like it is time to either go to another dental practice to continue learning from someone more experienced or to begin a search for a dental practice to acquire.
Other than buying a house, the acquisition of a dental practice may be the biggest financial step in the dentist’s life based on the money involved as well as the emotional part of the acquisition.
The confidence needed to buy the practice and to be on your own, financially, can be more unsettling than the student loans being faced after graduation.
If the saturation point in learning has been reached at your current position, you know that the time has come to move on to another place.
Are you ready for an acquisition or do you need more time learning from another before taking the step of purchasing a practice?
Only you know and it is probably not knowing for sure but taking a risk in either endeavor to find out the correct conclusion.
Going to Work for Another Dentist
The dentist has learned from the first job and usually feels confident about his or her clinical skills. Going to work for another dentist may be just to refresh some of those skills or to learn more about the administrative side of the practice.
If the dentist is going to be an owner of a practice at some point in his or her career, learning about the non-clinical skills is really a must.
Learning about hiring, firing, health insurance, retirement plans for the staff and the ability for the dental practice to grow in value will not happen without the dentist’s constant input from a clinical as well as administrative point of view.
If a job is taken as another associate dentist without any thought of being an owner as of now, it will be a time for the associate to hone his or her administrative and clinical abilities while working for the second dentist.
Comparing that position with the possibility of being an owner, will certainly allow the dentist to see the difference in earning ability and equity for himself or herself.
The dentist will see which makes the most sense when his or her peers are succeeding with the course they have chosen for themselves. It is a good thing for the associate dentist to look at his or her peers and the confidence they have for comparison with their confidence level.
Purchasing an Existing Dental Practice
Hopefully the dentist has a team that he or she has built over the years that consists of a dental CPA, an attorney, and a financial advisor or dental practice management consultant.
Having that type of advisory service available will substantially reduce the pressure on the dentist when making a decision about a question in the dental practice.
Shall the dentist buy a new piece of equipment, lease it or not do anything at all about spending money on it? Should the dentist wait before considering spending the money on any new type of equipment?
The financial people that advise the dentist will have a large effect on the dentist and his or her current and future income and what will happen with the practice and the employees.
These financial experts have been trained and have worked with dentists and dental practices and know the results of giving advice about the practice.
Hopefully, the dentist has surrounded himself or herself with those types of administrative people who are not generalists in understanding business without a good knowledge about dentists but are trained in assisting dentists and answering questions about dental practices.
It may cost a little more to retain someone who has a special understanding of dental practices and dentists and their specific needs but in the long term, the dental advisor will pay for himself or herself.
Those financial advisors and management people who know about warehouses, inventory, and the handling of accounts receivable and accounts payable are not for the dental practice.
These people usually don’t have an interest in goodwill, which is probably the most important and most valuable asset that the dentist has. A warehouse with a lot of inventory has nothing to do with creating goodwill at the dental practice.
Those selling the inventory will probably not have the educational background of the dentist or the dental hygienists.
Is it the best idea for the dentist to go to work for someone again because more confidence is needed before going out to be an owner?
Shall the dentist become an owner after getting the experience with the first job and the dentist who has taught the young associate enough so that he or she feels confident and can call on someone who can assist if there is a problem?
Some of the younger dental associates feel that they have plenty of time and would rather take their time and learn as much as possible before going out and being solo practitioners with the responsibility that comes with that title.
Timing is the key so if a younger person is not sure of when to become an owner, it is better to go slowly and learn as much as possible before striking out on his or her own.
Being younger is an advantage in this instance since the younger dentist will find a dental practice eventually and if it takes another year or more to find the practice, it is not going to hurt him or her since the young person can still learn and will feel ready when the time is right.
There are plenty of practices for sale so jumping in when the dentist is not ready is certainly a mistake.
Photo by Cedric Fauntleroy