In this article we’ll go through the considerations for starting a second practice.


Timing (Financial Considerations):


  • Profitability and revenue of your existing practice: Your first practice SHOULD be profitable from a BUSINESS PERSPECTIVE AFTER YOU DRAW YOUR 40%. Roughly 1 million in revenue is ideal as you should have a profit percentage of around ~15% and this will help offset the losses!
  • Your debt load and ability to borrow: If the existing debt and repayments on your current business is large, it may hinder your ability to borrow for a second practice. Especially if it’s a start-up. You need to be realistic about committing to another large debt. If the second practice does not have good cashflow, it could severely impact the finances of the first practice. If you are looking at starting a second practice, perhaps do not outlay for an expensive Conebeam or Cerec.
  • Personal cashflow and debts: There will be a period, depending on how good your marketing and location is of your first practice, that you will be required to put money into the new start-up. If you have large personal debt like mortgages, cars or if your spouse isn’t working due to parental leave then this can have a large impact on your personal life. As an example, it may not be a good idea to start a second practice when you have just committed to a large mortgage that requires much more repayments.


Timing (Personal Considerations):


  • Management and delegation ability: If you are struggling with management of one practice or are unable to delegate, a second practice is not for you. We know several examples of owners that need complete control and are unable to delegate attempt a second practice and failed miserably.
  • Personal life: How are things in your personal life? Big changes ahead? Want to start family soon? Get married/go on a long honeymoon? There will be a large time commitment in the setup phase and initial period. Will this have an adverse impact on your personal life?


Location and proximity to first practice: We’ll discuss the advantages and disadvantages of having a second practice that is in close proximity to your first.



  • Sharing of staff: Rostering can be more efficient. If patients cancel at one practice and it frees up the afternoon, you can move staff around to the other practice. It’s easier to cover staff on leave as there is a bigger pool of staff. For those that own a smaller practice 1-2 chairs, staff sickness can be a major issue especially if one staff member is already on leave. It can necessitate closing books or hiring expensive temps. By having another surgery in close proximity, you have room to move with respect to managing these situations as there is a greater pool of staff.
  • Share equipment and procedures: For example, orthodontics can be done at one practice. There may only be one practitioner that does ortho across the group and instead of moving equipment, inventory and orthodontically trained auxiliary staff around, we can keep them at the one location and refer patients.
  • Deter competitors: If you have an area nearby which has a good shopping centre and maybe a bit further out, with new development and people moving into the area then this may be attractive for a competitor to setup. By putting a practice there, in the area of growth, you deter other competitors coming in and setup a pseudo-monopoly for yourself. Obviously, costs are increased by being in two locations but it would be disastrous having a competitor come in and cut-off your supply of new patients because they are located closer to the growth.



  • Difficult exit: You may have to sell both practices. If selling just one then you may have issues with potential buyers seeing significant risk of goodwill slippage and therefore won’t be worth as much or harder to sell separately.
  • If too close – cannibalisation of existing patient base: If areas aren’t growing then there is the real potential to just increase your costs with no overall increase in turnover. You may just steal patients off the initial practice.



Branding: We aren’t like McDonalds or large companies where we have geographic reach. Branding the same serves us no purpose. One common myth around branding the same is that marketing is easier and cheaper – it’s not. Most marketing is local. You want to target the specific geographic area around a practice. It’s easier to market if the surgery is branded by the area name. Another myth is that you will get better bargaining power with suppliers. You can internally link the group even though each practice may have a different name.


The advantages of separate branding are as follows. It’s easier to sell each practice separately and there is no need to deal with a change of name etc. An unhappy patient at one practice may be retained by your other nearby practice (the patient doesn’t need to know that the ownership is the same). If a catastrophic incident (detrimental media article etc) occurs at one practice, the other practices aren’t contaminated (they would be grouped together if they had the same name).


A second practice is definitely easier the second time around as the systems are already in place and you have a degree of experience. It can be an excellent source of passive income. There is also a larger patient pool available to do special interest clinical procedures (FMR, Implants etc).


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Our next start-up and buying seminars are coming up in Sydney on Friday 26th and Saturday 27th of July 2024 and in Melbourne on Friday 18th and Saturday 19th of October 2024. Please register asap using the link below to avoid missing out.


We also offer expert guidance in various areas of practice ownership. Please see the below link for more information.


We’re holding our 2nd Dental Manager’s Conference (#DMC2024) in August. This is the premier event for dental manager’s (many owners also attended in 2022) and not to be missed. We have an amazing line up of speakers and the learning and networking opportunities will be immense. Please see the link below for more information.