**Be aware, the low billing practice** There will be a tsunami of practices coming up for sale or are already on sale, that are billing less than $500,000 a year. These practices have no profit and many are making a significant business loss. Many of them were started up in the last 4-5 years. Some…
**Marketing Return On Investment (ROI)** Marketing ROI, measures the effectiveness of the practice’s marketing efforts in generating revenue. For a dental practice, successful marketing campaigns can attract new patients, retain existing ones, and promote higher-value treatments. Calculating marketing ROI involves comparing the cost of marketing initiatives to the revenue generated from those efforts. Analyzing marketing…
**Case Study: Assessing Financials** Over the years we have seen many versions of dental financial statements through our consulting business. We’d like to think we have encountered most scenarios. However, every now and again we do get sent financials that surprise us. As a dentist looking to purchase a dental practice who has very little…
**Auxiliary Staff Ratios** It is probably the best time to visit this topic in light of increasing wages and difficult economic times ahead. In good times additional staff can go unnoticed, that is the additional billings make up for any staffing inefficiencies and hit on profitability. However, in an environment of stagnating or decreasing billings…
Profit! We expect dental practices that bill above 1 million to produce significant business profitability. We generally anticipate this to be around 20% of turnover. However, recently we’re analysing more and more of these practices that are far off this target with some even making a loss. Profitability typically rises with billings. There are exceptions…
Many good businesses have been undone by cash flow problems. For any potential practice owner, it is important they understand cash flow before embarking on ownership. At its core, cash flow is defined as the amount of money going into and out of your business at a given time. When there is more money…
**Asymmetrical Risk vs Reward** Over the years we’ve presented and advised on many situations related to dental practice ownership. We came across the above drawing recently. This drawing perhaps visually demonstrates our guiding philosophy best. We always attempt to minimise risk. However, we also consider risk in the context of rewards and upside. For…
**Opportunity!!!** One of the most important lessons I want the attendees from my Practice Ownership seminars to learn is the ability to find opportunities which others may overlook. We have real-world examples of two potential dental practices for sale. We give attendees the information that they will likely receive from the broker and/or vendor…
I discussed this topic several years ago and have recently had an influx of associates contact me about their specific situation and if ownership is right for them. It’s probably a good time to revisit this topic. Many associates have probably been super busy over the past two years due to considerable money flowing through…
Many dentist’s wanting to start-up a dental practice often encounter the dilemma of how large a tenancy to choose. This has become more relevant currently as fit out costs and rents increase substantially. The answer to this is multi-faceted. As a base one should know how many dental rooms will fit within a certain square…