**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…
We’ve noticed a recent spike in low billing surgeries coming to market and we suspect this trend to continue over at least the next 6 months as costs increase. We define a low billing surgery as one that does less than 600K per year in billings. This is the approximate point at which most dental…
At my practice ownership (startup and buying seminar) on the weekend, there was quite a bit of discussion about the economy and what we might expect coming up and what owners should be doing. I’d previously written about some things in 2020 when the downturn I predicted in our industry never actually materialised and things…
When looking at the impact of equipment on the overall value of a practice, it’s important to seperate out two types of equipment. Discrete, standalone, non standard items such as CBCT/Cerec and normal equipment every practice has. Discrete high value items, which can be easily separated and sold off are not the norm when discussing…