The Three Common Mistakes Buyers Make When Purchasing Their First Dental Practice
Transitioning from an associate to a practice owner is more than just a title change; it’s a significant leap into the business side of dentistry. Purchasing your first dental practice might seem simple, but it’s a path riddled with common mistakes. In this blog post, we highlight the three most frequent missteps first-time buyers make. Whether you’re gearing up to make a purchase or just exploring the idea, knowing what to watch out for can be the key to a smooth transition.
- Focusing on the Wrong Details:
When making an offer, buyers often get bogged down by minute details. Remember, the offer phase is about broad strokes. Post acceptance of your offer, you will have ample opportunity for due diligence. This means diving deep into practice management software, discussing specifics with the seller, and consulting with advisors. When making an offer, focus on these three crucial aspects:
- Location: Do you like the community and the practice’s location? Consider the commute; a short drive might be fine now, but think about those long days once you’re the owner.
- Revenue Trends: Check if the collections and cash flow of the business are growing or stable. Declining trends can be red flags.
- Dentistry Skills: Ensure you’re equipped to carry out the dentistry procedures the seller is known for. This includes the type of procedures as well as the pace.
- Relying Exclusively on Out-of-Town Advisors:
The New England dental market is unique, with typically higher prices than other regions. An out-of-town advisor might find local prices staggering. Thus, if you work with out-of-town advisors, make sure they’ve had experience in the New England market. It’s also a good strategy to balance them with local experts.
- Waiting for the ‘Perfect’ Practice:
Many prospective buyers have an ideal practice in mind, often mirroring a dream scenario. But remember, highly sought-after practices are rare and in great demand. Stay open to practices that might not tick every box but have potential. Think about aspects that can be easily changed, like interiors. You might not get your dream office immediately, but with time and effort, you can mold it into one.
Entering the world of dental practice ownership can be daunting. But by focusing on the right factors, working with experienced advisors, and keeping an open mind, you can make the transition smoother.
Think you might be ready to take the the next step in your dental career? Explore how Rosen Dental Transitions can help.