Category Archives: Before You Buy

Running a dental office ain’t cheap. And it might be tempting to focus solely on the biggest expense on your list, the staff. But having a good handle on all your expenses is important. Today we’re going to focus on another major expense for dental practices: supply costs.

Q: How much should I be paying for facility costs?

A: Facility costs should account for 5-10% of practice collections, whether you’re renting the facility or purchasing it. This expense is very geographically specific so there is no exact benchmark price you should pay for a facility. But 5-10% is a good range to start with.

I’m about to tell you something that may seem counterintuitive: Active patient count is not as important as people think it is. At least, not on its own.

Dental practice valuation is a huge task. It’s easy to focus on the major factors such as overhead, profit margins, and staff costs. But don’t forget to include accounts payable into your equation. Otherwise, you might be in for an unpleasant reality check after you’ve closed on the practice.

You’ve closed on a dental practice and need to transition from the previous owner’s management to your capable hands. Here’s how to tell the staff about the practice transition.

A buyer I’m currently working with found a good practice for sale and asked for my help with the analysis and LOI. The target practice is solid, collecting $680k last year with overhead around 62% and a decent amount of hygiene in a rural area of the country.

One problem. The price.

Both are great ways to make more money, pay off student loans, and build real wealth over your career. So for young dentists the question often comes up: should I build or buy? There’s no shortage of opinions in dental forums, but let me give you my two cents as someone who has spent over a decade helping dentists buy practices.