The Emotional Side of Transitioning Your Dental Practice

dentist with hands folded and looking at the floor

Transitioning a dental practice, whether you’re selling or merging, is a significant milestone in any dentist’s career. This journey, while full of opportunities, is also full of emotional challenges. Understanding and addressing these often overlooked emotional aspects is key to a smooth and successful transition. This article explores the various emotional facets of transitioning your dental practice and provides strategies to manage them effectively.

Coping With the Stress of Selling or Merging

The process of selling or merging a dental practice can be overwhelming. It involves many decisions, from financial considerations to logistical details. And, it isn’t just a professional change; it’s a significant life event that can impact your mental health. On top of that, dentistry is already a stressful job, with more than half of dentists experiencing high job stress according to a study from Nature (1). Recognizing this and taking proactive steps to manage your emotional well-being is essential for a successful transition.

Identifying Common Stressors

  • Uncertainty: The unknowns associated with the transition can create anxiety about the future direction of the practice and personal career path.
  • Workload: Balancing current practice demands while planning for the transition can lead to burnout. Selling a practice typically requires about 150 hours, spreading dentists thin between clinical care, business management and transition planning.
  • Financial Pressure: Large investments or holding a significant amount of debt can be scary and overwhelming. When investing in a dental practice, enlist experts to provide critical support, such as knowledge of medical or dental competition, patient demographics and expertise in practice appraisals to determine fair market value. For potential sellers, partnering with a dental service organization (DSO) often includes “cash at close,” providing immediate financial relief to clear debts and enhance financial stability for future endeavors.
  • Concerns With Exiting a Partnership: Transitioning out of a dental practice partnership is often complex, especially when one partner plans to retire while the other intends to continue practicing. This scenario often leads to divergent paths and requires careful planning to ensure a smooth transition for both parties. DSOs can offer structured solutions and support in navigating these transitions, facilitating agreements that accommodate different career aspirations and personal goals.
  • Worries About Clinical Autonomy in a DSO Transition: Modern DSOs offer varying levels of involvement, so finding one with your clinical and cultural values is crucial to preserving professional independence and patient care standards. To find the best fit, evaluate their support infrastructure and commitment to clinical autonomy. With over 375 DSOs available, an experienced broker can help identify those that align with your values and avoid those that might impose unwelcome changes.
  • Navigating Industry Shifts: The dental industry is currently undergoing significant consolidation, with approximately 35% of practices already consolidated (3) into DSO groups. This ongoing consolidation adds stress as practitioners must act soon amidst changing market dynamics to capitalize on the current opportunity before it’s too late.
  • Choosing the Best Option: It’s stressful when weighing multiple options before deciding on the best path forward for both personal and professional goals. When considering options for transitioning your practice, especially as a potential seller, it’s essential to weigh various deal structures available with DSOs, which include options such as an equity roll, joint venture model or outright sale to a DSO. Each structure offers different benefits and considerations, such as the financial incentives discussed in DrBicuspid.com (2), operational autonomy and future growth potential.

Strategies for Managing Stress

  • Plan Ahead: Create a detailed transition plan to minimize last-minute surprises. We always recommend starting the planning process at least five years before you want to transition your practice.
  • Delegate Tasks: Delegate responsibilities to trusted staff or consider hiring temporary assistance for help running the business during peak workload periods. Clearing non-essential tasks from your plate allows you to focus more on patient care and strategic planning.
  • Prepare To Sell: Effectively prepare by conducting a practice appraisal, which identifies opportunities to maximize profitability and enhance your practice’s overall value before listing it for sale. By optimizing financial and operational efficiency, you not only enhance your practice’s appeal but also navigate the selling process with greater confidence and reduced stress.
  • Seek Professional Help: Engaging with expert brokers like Professional Transition Strategies provides strategic guidance tailored to your goals and can support you in navigating negotiations, ensuring financial transparency and devising long-term growth strategies. This personalized counsel empowers dental entrepreneurs to make informed decisions that align with their personal vision for practice ownership, alleviating stress by knowing they have the best expertise guiding them every step of the way.

Managing Staff Emotions During Transitions

Your staff plays a critical role in your practice, and their emotions and reactions during a transition can significantly impact the process. It’s essential to avoid prematurely notifying staff about potential changes before the sale is finalized. Doing so could lead to significant disruptions and uncertainties among the team. Here’s how to approach communication effectively once the sale is complete:

Transparent Communication With Staff

  • Timing of Communication: Wait until the sale is complete before informing your staff about any impending transitions or changes. Premature communication can create unnecessary anxiety and speculation. Once the sale is finalized, it becomes appropriate to inform your staff about the upcoming changes to help mitigate uncertainties and alleviate fears.
  • Keep Them Informed: Regular updates about the transition can help alleviate fears and uncertainties. Clearly explain the steps involved in the transition and what it means for the staff.
  • Highlight Benefits: Discuss the potential benefits that come with the transition, whether it’s new career growth opportunities, enhanced benefits or improved working conditions.
  • Showcase Improvements: Inform staff about any improvements that will come with the transition, such as new technology, better facilities or expanded services.
  • Provide Support: Offer resources and support to help staff cope with the changes. This might include workshops or one-on-one meetings to address individual concerns.

Staff Benefits from DSO Transitions

Transitioning to a DSO can provide your staff with numerous benefits that enhance their professional and personal lives. DSOs are structured to offer comprehensive benefits, including health care and a 401K plan, from the outset. For hygienists and other dental professionals, DSOs present a well-defined career path with clear job opportunities. This structured approach allows staff to understand and plan their potential career progression. Moreover, DSOs invest in the latest technology, which not only improves the clinical experience for staff but also keeps them engaged and motivated. Overall, DSOs provide a supportive and structured environment that can greatly enhance job satisfaction and career growth for dental practice employees.

Dealing With Uncertainty

Change, even when positive, can trigger feelings of uncertainty and fear. Recognizing and addressing these emotions is essential for a smooth transition.

Coping Mechanisms

  • Acknowledge Your Feelings: Accepting and understanding your emotions can help you manage them better.
  • Stay Positive: Focus on the benefits and opportunities that the transition will bring.
  • Seek Support: Talk to colleagues, friends or a trained professional to help process your feelings. Connecting with other dentists who have undergone a similar practice transition can provide valuable insights and alleviate fears, or help identify DSO groups that may be a good fit if you’re considering selling your practice. Understanding their experiences with different DSOs can guide your decision-making process and ease concerns about the transition. Additionally, partnering with a seasoned dental practice broker can assist in identifying your ideal buyer, easing any worries you might have.

Balancing Personal and Professional Life

A transition can disrupt the delicate balance between your personal and professional life. It’s important to find ways to maintain this balance to ensure overall well-being.

Ensuring Self-Care During the Transition

  • Set Boundaries: Allocate specific times for work and personal activities.
  • Trust Your Team: Entrust responsibilities to your team to avoid overburdening yourself.
  • Take Breaks: Regular breaks and time off can help prevent burnout.

Financial Considerations and Emotional Well-Being

Financial aspects of a transition can significantly impact your emotional well-being. Proper financial planning and management can alleviate stress and ensure a smoother transition. These steps ensure that financial considerations are carefully managed throughout the transition process, providing financial stability and peace of mind.

Financial Planning Tips

  • Merging Dental Practices: When merging practices, it’s crucial to budget for integration costs, potential redundancies and any legal or regulatory expenses involved. An experienced dental broker can help navigate the complexities of combining financial systems and aligning revenue streams to ensure a seamless transition.
  • Selling a Dental Practice: Planning for a successful sale involves conducting a thorough practice appraisal to determine its fair market value and identifying and vetting potential buyers – both groups and individuals. Seeking guidance from an expert broker can streamline negotiations and maximize financial benefits from the sale.

Creating a Transition Timeline and Checklist

DSOs fit the dentist who craves a work-life balance and don’t want the added stress of the managerial responsibilities that come along with owning a business. Working 32 clinical hours (instead of six days a week with early mornings) is appealing to both the younger and older generation, especially leading up to retirement and to avoid burnout. For those looking to ease into retirement, working for a DSO can offer an abbreviated schedule rather than the added stress of a transition to another dentist. What’s more, you have the chance to expand and move toward a one-stop-shop model, all while increasing the value of your dental practice.

Developing a Transition Plan

  – Set clear goals: Start by defining what you want to achieve with the transition. This includes your personal and professional goals, financial objectives and career aspirations.

  • Create a timeline: Outline the steps and deadlines for each phase of the transition. Begin planning early to give yourself ample time to address potential challenges and make informed decisions. When selling your practice, you should start the transition process early to allow for strategic positioning of your practice in a competitive environment to source attractive offers.
  • Track progress: Regularly review and adjust your plan as needed to stay on track. Keeping a close eye on your timeline ensures that you remain focused on your goals and can address any issues promptly.
  • Consult an expert: Engaging a dental practice broker can provide numerous benefits, such as enhanced negotiating capabilities, strategic positioning and navigating legal and financial complexities. Brokers can help craft advantageous deal structures and secure more competitive offers, ultimately maximizing the value of your practice transition.

Common Questions

What stresses do dentists face? Why is dentistry the most stressful job?

Dentists face a multitude of stressors that contribute to high levels of anxiety, burnout, and emotional health concerns. According to the ADA’s 2021 Dentist Health and Well-Being Survey, anxiety levels among dentists have more than tripled since 2003, with 16% of respondents reporting anxiety and 13% reporting depression (4). The COVID-19 pandemic has significantly exacerbated these issues, adding unique stressors related to safety, patient management, and operational challenges.

Dentistry is widely recognized as one of the most stressful professions due to factors such as patient anxiety, the demanding precision required, and the physical rigors of the work. The profession’s high standards for accuracy, coupled with the consequences of mistakes, alongside the long hours and physical strain, collectively intensify the stress experienced by dentists.

Why is emotional intelligence important in dentistry?

Emotional intelligence is important in dentistry because it builds patient rapport, enhances team collaboration and improves decision-making. Understanding and addressing patient needs and concerns helps create a positive patient experience. Promoting better communication and cooperation among staff leads to a more harmonious work environment. Additionally, emotional intelligence enables more empathetic and effective decision-making.

How do you make dentistry less stressful?

To make dentistry less stressful, practice self-care, seek support, delegate tasks and stay organized. To alleviate the stress of owning and managing a dental practice, especially without formal business training, many dentists find transitioning to a DSO to be a beneficial option. This transition allows dentists to refocus on clinical care by offloading managerial responsibilities such as marketing, payroll, human resources and recruiting to dedicated professionals within the DSO.

This shift is significant as it enables dentists to return to their passion for clinical work, spending more time chairside with patients.

Bottom Line

The dental industry is currently undergoing significant change, with approximately 35% of practices already consolidated. This ongoing consolidation adds urgency as practitioners must act soon to capitalize on the current opportunity before it’s too late. Delaying your decision could result in missed opportunities, reduced practice value and increased competition.

Begin planning your transition early, seek professional guidance, maintain open communication, and take care of your mental and emotional well-being. Acting promptly and decisively will not only maximize your financial returns but also provide peace of mind as you navigate this significant milestone in your career.

To ensure a smooth and successful transition that addresses both financial and emotional factors, contact the experts at Professional Transition Strategies.

References

  1. Nature, “Dentistry and the stress of practice,” https://www.nature.com/articles/sj.bdj.2019.18
  2. DrBicuspid.com, “4 key financial considerations when selling to a DSO,” https://www.drbicuspid.com/dental-business/practice-sales/article/15678019/4-key-financial-considerations-when-selling-to-a-dso 
  3. DrBicuspid.com, “Halfway Through the Dental Consolidation Wave: What Entrepreneurs Need to Know,” https://www.drbicuspid.com/dental-business/dso/article/15667122/halfway-through-the-dental-consolidation-wave-heres-what-entrepreneurs-need-to-know
  4. ADA, “Survey: Younger Dentists Report Higher Level of Stress, Emotional Health Concerns,” https://adanews.ada.org/new-dentist/2022/february/survey-younger-dentist-report-higher-level-of-stress-emotional-health-concerns/

More Reasons To Sell Your Dental Practice to a DSO

dentist with hands folded and looking at the floor

Transitioning a dental practice, whether you’re selling or merging, is a significant milestone in any dentist’s career. This journey, while full of opportunities, is also full of emotional challenges. Understanding and addressing these often overlooked emotional aspects is key to a smooth and successful transition. This article explores the various emotional facets of transitioning your dental practice and provides strategies to manage them effectively.

Coping With the Stress of Selling or Merging

The process of selling or merging a dental practice can be overwhelming. It involves many decisions, from financial considerations to logistical details. And, it isn’t just a professional change; it’s a significant life event that can impact your mental health. On top of that, dentistry is already a stressful job, with more than half of dentists experiencing high job stress according to a study from Nature (1). Recognizing this and taking proactive steps to manage your emotional well-being is essential for a successful transition.

Identifying Common Stressors

  • Uncertainty: The unknowns associated with the transition can create anxiety about the future direction of the practice and personal career path.
  • Workload: Balancing current practice demands while planning for the transition can lead to burnout. Selling a practice typically requires about 150 hours, spreading dentists thin between clinical care, business management and transition planning.
  • Financial Pressure: Large investments or holding a significant amount of debt can be scary and overwhelming. When investing in a dental practice, enlist experts to provide critical support, such as knowledge of medical or dental competition, patient demographics and expertise in practice appraisals to determine fair market value. For potential sellers, partnering with a dental service organization (DSO) often includes “cash at close,” providing immediate financial relief to clear debts and enhance financial stability for future endeavors.
  • Concerns With Exiting a Partnership: Transitioning out of a dental practice partnership is often complex, especially when one partner plans to retire while the other intends to continue practicing. This scenario often leads to divergent paths and requires careful planning to ensure a smooth transition for both parties. DSOs can offer structured solutions and support in navigating these transitions, facilitating agreements that accommodate different career aspirations and personal goals.
  • Worries About Clinical Autonomy in a DSO Transition: Modern DSOs offer varying levels of involvement, so finding one with your clinical and cultural values is crucial to preserving professional independence and patient care standards. To find the best fit, evaluate their support infrastructure and commitment to clinical autonomy. With over 375 DSOs available, an experienced broker can help identify those that align with your values and avoid those that might impose unwelcome changes.
  • Navigating Industry Shifts: The dental industry is currently undergoing significant consolidation, with approximately 35% of practices already consolidated (3) into DSO groups. This ongoing consolidation adds stress as practitioners must act soon amidst changing market dynamics to capitalize on the current opportunity before it’s too late.
  • Choosing the Best Option: It’s stressful when weighing multiple options before deciding on the best path forward for both personal and professional goals. When considering options for transitioning your practice, especially as a potential seller, it’s essential to weigh various deal structures available with DSOs, which include options such as an equity roll, joint venture model or outright sale to a DSO. Each structure offers different benefits and considerations, such as the financial incentives discussed in DrBicuspid.com (2), operational autonomy and future growth potential.

Strategies for Managing Stress

  • Plan Ahead: Create a detailed transition plan to minimize last-minute surprises. We always recommend starting the planning process at least five years before you want to transition your practice.
  • Delegate Tasks: Delegate responsibilities to trusted staff or consider hiring temporary assistance for help running the business during peak workload periods. Clearing non-essential tasks from your plate allows you to focus more on patient care and strategic planning.
  • Prepare To Sell: Effectively prepare by conducting a practice appraisal, which identifies opportunities to maximize profitability and enhance your practice’s overall value before listing it for sale. By optimizing financial and operational efficiency, you not only enhance your practice’s appeal but also navigate the selling process with greater confidence and reduced stress.
  • Seek Professional Help: Engaging with expert brokers like Professional Transition Strategies provides strategic guidance tailored to your goals and can support you in navigating negotiations, ensuring financial transparency and devising long-term growth strategies. This personalized counsel empowers dental entrepreneurs to make informed decisions that align with their personal vision for practice ownership, alleviating stress by knowing they have the best expertise guiding them every step of the way.

Managing Staff Emotions During Transitions

Your staff plays a critical role in your practice, and their emotions and reactions during a transition can significantly impact the process. It’s essential to avoid prematurely notifying staff about potential changes before the sale is finalized. Doing so could lead to significant disruptions and uncertainties among the team. Here’s how to approach communication effectively once the sale is complete:

Transparent Communication With Staff

  • Timing of Communication: Wait until the sale is complete before informing your staff about any impending transitions or changes. Premature communication can create unnecessary anxiety and speculation. Once the sale is finalized, it becomes appropriate to inform your staff about the upcoming changes to help mitigate uncertainties and alleviate fears.
  • Keep Them Informed: Regular updates about the transition can help alleviate fears and uncertainties. Clearly explain the steps involved in the transition and what it means for the staff.
  • Highlight Benefits: Discuss the potential benefits that come with the transition, whether it’s new career growth opportunities, enhanced benefits or improved working conditions.
  • Showcase Improvements: Inform staff about any improvements that will come with the transition, such as new technology, better facilities or expanded services.
  • Provide Support: Offer resources and support to help staff cope with the changes. This might include workshops or one-on-one meetings to address individual concerns.

Staff Benefits from DSO Transitions

Transitioning to a DSO can provide your staff with numerous benefits that enhance their professional and personal lives. DSOs are structured to offer comprehensive benefits, including health care and a 401K plan, from the outset. For hygienists and other dental professionals, DSOs present a well-defined career path with clear job opportunities. This structured approach allows staff to understand and plan their potential career progression. Moreover, DSOs invest in the latest technology, which not only improves the clinical experience for staff but also keeps them engaged and motivated. Overall, DSOs provide a supportive and structured environment that can greatly enhance job satisfaction and career growth for dental practice employees.

Dealing With Uncertainty

Change, even when positive, can trigger feelings of uncertainty and fear. Recognizing and addressing these emotions is essential for a smooth transition.

Coping Mechanisms

  • Acknowledge Your Feelings: Accepting and understanding your emotions can help you manage them better.
  • Stay Positive: Focus on the benefits and opportunities that the transition will bring.
  • Seek Support: Talk to colleagues, friends or a trained professional to help process your feelings. Connecting with other dentists who have undergone a similar practice transition can provide valuable insights and alleviate fears, or help identify DSO groups that may be a good fit if you’re considering selling your practice. Understanding their experiences with different DSOs can guide your decision-making process and ease concerns about the transition. Additionally, partnering with a seasoned dental practice broker can assist in identifying your ideal buyer, easing any worries you might have.

Balancing Personal and Professional Life

A transition can disrupt the delicate balance between your personal and professional life. It’s important to find ways to maintain this balance to ensure overall well-being.

Ensuring Self-Care During the Transition

  • Set Boundaries: Allocate specific times for work and personal activities.
  • Trust Your Team: Entrust responsibilities to your team to avoid overburdening yourself.
  • Take Breaks: Regular breaks and time off can help prevent burnout.

Financial Considerations and Emotional Well-Being

Financial aspects of a transition can significantly impact your emotional well-being. Proper financial planning and management can alleviate stress and ensure a smoother transition. These steps ensure that financial considerations are carefully managed throughout the transition process, providing financial stability and peace of mind.

Financial Planning Tips

  • Merging Dental Practices: When merging practices, it’s crucial to budget for integration costs, potential redundancies and any legal or regulatory expenses involved. An experienced dental broker can help navigate the complexities of combining financial systems and aligning revenue streams to ensure a seamless transition.
  • Selling a Dental Practice: Planning for a successful sale involves conducting a thorough practice appraisal to determine its fair market value and identifying and vetting potential buyers – both groups and individuals. Seeking guidance from an expert broker can streamline negotiations and maximize financial benefits from the sale.

Creating a Transition Timeline and Checklist

DSOs fit the dentist who craves a work-life balance and don’t want the added stress of the managerial responsibilities that come along with owning a business. Working 32 clinical hours (instead of six days a week with early mornings) is appealing to both the younger and older generation, especially leading up to retirement and to avoid burnout. For those looking to ease into retirement, working for a DSO can offer an abbreviated schedule rather than the added stress of a transition to another dentist. What’s more, you have the chance to expand and move toward a one-stop-shop model, all while increasing the value of your dental practice.

Developing a Transition Plan

  – Set clear goals: Start by defining what you want to achieve with the transition. This includes your personal and professional goals, financial objectives and career aspirations.

  • Create a timeline: Outline the steps and deadlines for each phase of the transition. Begin planning early to give yourself ample time to address potential challenges and make informed decisions. When selling your practice, you should start the transition process early to allow for strategic positioning of your practice in a competitive environment to source attractive offers.
  • Track progress: Regularly review and adjust your plan as needed to stay on track. Keeping a close eye on your timeline ensures that you remain focused on your goals and can address any issues promptly.
  • Consult an expert: Engaging a dental practice broker can provide numerous benefits, such as enhanced negotiating capabilities, strategic positioning and navigating legal and financial complexities. Brokers can help craft advantageous deal structures and secure more competitive offers, ultimately maximizing the value of your practice transition.

Common Questions

What stresses do dentists face? Why is dentistry the most stressful job?

Dentists face a multitude of stressors that contribute to high levels of anxiety, burnout, and emotional health concerns. According to the ADA’s 2021 Dentist Health and Well-Being Survey, anxiety levels among dentists have more than tripled since 2003, with 16% of respondents reporting anxiety and 13% reporting depression (4). The COVID-19 pandemic has significantly exacerbated these issues, adding unique stressors related to safety, patient management, and operational challenges.

Dentistry is widely recognized as one of the most stressful professions due to factors such as patient anxiety, the demanding precision required, and the physical rigors of the work. The profession’s high standards for accuracy, coupled with the consequences of mistakes, alongside the long hours and physical strain, collectively intensify the stress experienced by dentists.

Why is emotional intelligence important in dentistry?

Emotional intelligence is important in dentistry because it builds patient rapport, enhances team collaboration and improves decision-making. Understanding and addressing patient needs and concerns helps create a positive patient experience. Promoting better communication and cooperation among staff leads to a more harmonious work environment. Additionally, emotional intelligence enables more empathetic and effective decision-making.

How do you make dentistry less stressful?

To make dentistry less stressful, practice self-care, seek support, delegate tasks and stay organized. To alleviate the stress of owning and managing a dental practice, especially without formal business training, many dentists find transitioning to a DSO to be a beneficial option. This transition allows dentists to refocus on clinical care by offloading managerial responsibilities such as marketing, payroll, human resources and recruiting to dedicated professionals within the DSO.

This shift is significant as it enables dentists to return to their passion for clinical work, spending more time chairside with patients.

Bottom Line

The dental industry is currently undergoing significant change, with approximately 35% of practices already consolidated. This ongoing consolidation adds urgency as practitioners must act soon to capitalize on the current opportunity before it’s too late. Delaying your decision could result in missed opportunities, reduced practice value and increased competition.

Begin planning your transition early, seek professional guidance, maintain open communication, and take care of your mental and emotional well-being. Acting promptly and decisively will not only maximize your financial returns but also provide peace of mind as you navigate this significant milestone in your career.

To ensure a smooth and successful transition that addresses both financial and emotional factors, contact the experts at Professional Transition Strategies.

References

  1. Nature, “Dentistry and the stress of practice,” https://www.nature.com/articles/sj.bdj.2019.18
  2. DrBicuspid.com, “4 key financial considerations when selling to a DSO,” https://www.drbicuspid.com/dental-business/practice-sales/article/15678019/4-key-financial-considerations-when-selling-to-a-dso 
  3. DrBicuspid.com, “Halfway Through the Dental Consolidation Wave: What Entrepreneurs Need to Know,” https://www.drbicuspid.com/dental-business/dso/article/15667122/halfway-through-the-dental-consolidation-wave-heres-what-entrepreneurs-need-to-know
  4. ADA, “Survey: Younger Dentists Report Higher Level of Stress, Emotional Health Concerns,” https://adanews.ada.org/new-dentist/2022/february/survey-younger-dentist-report-higher-level-of-stress-emotional-health-concerns/

Is Now the Time to Sell Your Dental Practice? Insights from Kim McCleskey on The DrBicuspid.com Podcast

Professional Transition Strategies Consultant Kim McCleskey recently joined The DrBicuspid.com Podcast to discuss the current economic climate and its implications for dentists interested in selling their practices now or in the future. With 30 years of experience in the industry, McCleskey provided valuable insights into the evolving landscape of dental practice ownership. Here’s a summary of the podcast conversation.

 

Understanding the Current Economic Climate

McCleskey highlighted the current state of the dental industry, noting that it is approximately 35% consolidated, which is about halfway through the consolidation wave taking place. Consolidation is projected to reach the full 60-70% within the next 5-7 years, signifying a paradigm shift in the industry’s investment dynamics. With a growing number of practices falling under private-equity backed DSOs, the influx of investor capital will eventually slow. McCleskey emphasized the significance of this shift, as it will fundamentally alter the ownership landscape of dental practices.

Urgency in Decision-Making

With the impending wave of dental consolidation, there is a sense of urgency for dentists to consider their options. McCleskey discussed the pressure on dentists to sell now versus potentially waiting. Your options in the next three to four years following the peak of consolidation are going to decrease and change, she noted. She also stressed the importance of dentists understanding their options and making informed decisions to navigate this evolving landscape effectively.

Treating Dental Practices as Businesses

McCleskey underscored the importance of treating dental practices as businesses and understanding their profitability and value. The first step down this path is to get dialed into conversations about profitability. Working with experts like PTS to create a prospectus can help you understand your business and options, whether you’re selling to an individual or a DSO. This business-oriented approach ensures dentists make informed decisions that enhance the financial health and marketability of their practice.

Preparing Your Practice for Sale

The dental industry consolidation wave is nearing its peak, with only one to two rounds of recapitalization events likely remaining. Translated for your practice: This is a limited-time opportunity to maximize your wealth through a sale. For instance, for a practice valued at $2 million with $500,000 EBITDA (earnings before interest, taxes, depreciation and amortization), it can be a difference between selling for $2.75 million vs. $3.25 million for the same deal with two recapitalization events. Don’t miss out on the chance to capitalize on a strong seller’s market.

In preparation to sell, it’s imperative to build the profitability of your practice and its infrastructure now. McClesky advises that if you want to use your practice as an investment vehicle, now is the time to make sure your practice has the kind of value that will help with your personal and professional goals. She advises that it’s never too early to have an understanding of where your business is and to have a valuation done to understand what you can do differently to move the needle in your favor for when it comes time to sell.

Exploring Alternative Options

Selling to a DSO is a great option for many dentists, especially for those with practices that aren’t currently profitable and are considering retirement. Instead of closing up shop and walking away with nothing, DSOs offer an alternative that can help improve profitability and secure a better outcome for your practice.

McCleskey emphasized the importance of understanding the range of deal options DSOs provide. DSOs provide various deal structures tailored to meet different needs and goals. These include outright sales, equity rollovers, joint ventures, 100% buyouts and hybrid options. Each type of deal offers unique benefits, such as maintaining some level of ownership, receiving ongoing income or benefiting from the DSO’s resources and support to enhance practice profitability.

DSOs can help transform an unprofitable practice into a more valuable asset, offering a practical and profitable exit strategy for dentists close or ready to retire. By leveraging these options, dentists can find a deal structure that aligns with their personal and professional objectives.

What’s Next?

McCleskey’s insights shed light on the current economic climate of the dental industry and its implications for dentists. With the industry poised for significant consolidation in the coming years, dentists must understand their options and make strategic decisions now to secure their future success. 

Listen to the recent episode of The DrBicuspid.com Podcast featuring McCleskey to gain insights on the pressing market dynamics and understand if now is the right time to consider selling.

Contact the experts at Professional Transition Strategies for guidance on practice valuations, profitability consulting, and exploring the best transition options for your unique goals.

Navigating Dental Practice Transitions: Insights from Kim McCleskey on The DrBicuspid.com Podcast

Professional Transition Strategies Consultant Kim McCleskey recently joined The DrBicuspid.com Podcast to discuss the current economic climate and its implications for dentists interested in selling their practices now or in the future. With 30 years of experience in the industry, McCleskey provided valuable insights into the evolving landscape of dental practice ownership. Here’s a summary of the podcast conversation.

 

Understanding the Current Economic Climate

McCleskey highlighted the current state of the dental industry, noting that it is approximately 35% consolidated, which is about halfway through the consolidation wave taking place. Consolidation is projected to reach the full 60-70% within the next 5-7 years, signifying a paradigm shift in the industry’s investment dynamics. With a growing number of practices falling under private-equity backed DSOs, the influx of investor capital will eventually slow. McCleskey emphasized the significance of this shift, as it will fundamentally alter the ownership landscape of dental practices.

Urgency in Decision-Making

With the impending wave of dental consolidation, there is a sense of urgency for dentists to consider their options. McCleskey discussed the pressure on dentists to sell now versus potentially waiting. Your options in the next three to four years following the peak of consolidation are going to decrease and change, she noted. She also stressed the importance of dentists understanding their options and making informed decisions to navigate this evolving landscape effectively.

Treating Dental Practices as Businesses

McCleskey underscored the importance of treating dental practices as businesses and understanding their profitability and value. The first step down this path is to get dialed into conversations about profitability. Working with experts like PTS to create a prospectus can help you understand your business and options, whether you’re selling to an individual or a DSO. This business-oriented approach ensures dentists make informed decisions that enhance the financial health and marketability of their practice.

Preparing Your Practice for Sale

The dental industry consolidation wave is nearing its peak, with only one to two rounds of recapitalization events likely remaining. Translated for your practice: This is a limited-time opportunity to maximize your wealth through a sale. For instance, for a practice valued at $2 million with $500,000 EBITDA (earnings before interest, taxes, depreciation and amortization), it can be a difference between selling for $2.75 million vs. $3.25 million for the same deal with two recapitalization events. Don’t miss out on the chance to capitalize on a strong seller’s market.

In preparation to sell, it’s imperative to build the profitability of your practice and its infrastructure now. McClesky advises that if you want to use your practice as an investment vehicle, now is the time to make sure your practice has the kind of value that will help with your personal and professional goals. She advises that it’s never too early to have an understanding of where your business is and to have a valuation done to understand what you can do differently to move the needle in your favor for when it comes time to sell.

Exploring Alternative Options

Selling to a DSO is a great option for many dentists, especially for those with practices that aren’t currently profitable and are considering retirement. Instead of closing up shop and walking away with nothing, DSOs offer an alternative that can help improve profitability and secure a better outcome for your practice.

McCleskey emphasized the importance of understanding the range of deal options DSOs provide. DSOs provide various deal structures tailored to meet different needs and goals. These include outright sales, equity rollovers, joint ventures, 100% buyouts and hybrid options. Each type of deal offers unique benefits, such as maintaining some level of ownership, receiving ongoing income or benefiting from the DSO’s resources and support to enhance practice profitability.

DSOs can help transform an unprofitable practice into a more valuable asset, offering a practical and profitable exit strategy for dentists close or ready to retire. By leveraging these options, dentists can find a deal structure that aligns with their personal and professional objectives.

What’s Next?

McCleskey’s insights shed light on the current economic climate of the dental industry and its implications for dentists. With the industry poised for significant consolidation in the coming years, dentists must understand their options and make strategic decisions now to secure their future success. 

Listen to the recent episode of The DrBicuspid.com Podcast featuring McCleskey to gain insights on the pressing market dynamics and understand if now is the right time to consider selling.

Contact the experts at Professional Transition Strategies for guidance on practice valuations, profitability consulting, and exploring the best transition options for your unique goals.

Why Dental Entrepreneurs Need to Act Now: Insights from Becker’s Webinar with PTS Founder Kyle Francis and Lead Broker Stanton Kensinger

Professional Transition Strategies Consultant Kim McCleskey recently joined The DrBicuspid.com Podcast to discuss the current economic climate and its implications for dentists interested in selling their practices now or in the future. With 30 years of experience in the industry, McCleskey provided valuable insights into the evolving landscape of dental practice ownership. Here’s a summary of the podcast conversation.

 

Understanding the Current Economic Climate

McCleskey highlighted the current state of the dental industry, noting that it is approximately 35% consolidated, which is about halfway through the consolidation wave taking place. Consolidation is projected to reach the full 60-70% within the next 5-7 years, signifying a paradigm shift in the industry’s investment dynamics. With a growing number of practices falling under private-equity backed DSOs, the influx of investor capital will eventually slow. McCleskey emphasized the significance of this shift, as it will fundamentally alter the ownership landscape of dental practices.

Urgency in Decision-Making

With the impending wave of dental consolidation, there is a sense of urgency for dentists to consider their options. McCleskey discussed the pressure on dentists to sell now versus potentially waiting. Your options in the next three to four years following the peak of consolidation are going to decrease and change, she noted. She also stressed the importance of dentists understanding their options and making informed decisions to navigate this evolving landscape effectively.

Treating Dental Practices as Businesses

McCleskey underscored the importance of treating dental practices as businesses and understanding their profitability and value. The first step down this path is to get dialed into conversations about profitability. Working with experts like PTS to create a prospectus can help you understand your business and options, whether you’re selling to an individual or a DSO. This business-oriented approach ensures dentists make informed decisions that enhance the financial health and marketability of their practice.

Preparing Your Practice for Sale

The dental industry consolidation wave is nearing its peak, with only one to two rounds of recapitalization events likely remaining. Translated for your practice: This is a limited-time opportunity to maximize your wealth through a sale. For instance, for a practice valued at $2 million with $500,000 EBITDA (earnings before interest, taxes, depreciation and amortization), it can be a difference between selling for $2.75 million vs. $3.25 million for the same deal with two recapitalization events. Don’t miss out on the chance to capitalize on a strong seller’s market.

In preparation to sell, it’s imperative to build the profitability of your practice and its infrastructure now. McClesky advises that if you want to use your practice as an investment vehicle, now is the time to make sure your practice has the kind of value that will help with your personal and professional goals. She advises that it’s never too early to have an understanding of where your business is and to have a valuation done to understand what you can do differently to move the needle in your favor for when it comes time to sell.

Exploring Alternative Options

Selling to a DSO is a great option for many dentists, especially for those with practices that aren’t currently profitable and are considering retirement. Instead of closing up shop and walking away with nothing, DSOs offer an alternative that can help improve profitability and secure a better outcome for your practice.

McCleskey emphasized the importance of understanding the range of deal options DSOs provide. DSOs provide various deal structures tailored to meet different needs and goals. These include outright sales, equity rollovers, joint ventures, 100% buyouts and hybrid options. Each type of deal offers unique benefits, such as maintaining some level of ownership, receiving ongoing income or benefiting from the DSO’s resources and support to enhance practice profitability.

DSOs can help transform an unprofitable practice into a more valuable asset, offering a practical and profitable exit strategy for dentists close or ready to retire. By leveraging these options, dentists can find a deal structure that aligns with their personal and professional objectives.

What’s Next?

McCleskey’s insights shed light on the current economic climate of the dental industry and its implications for dentists. With the industry poised for significant consolidation in the coming years, dentists must understand their options and make strategic decisions now to secure their future success. 

Listen to the recent episode of The DrBicuspid.com Podcast featuring McCleskey to gain insights on the pressing market dynamics and understand if now is the right time to consider selling.

Contact the experts at Professional Transition Strategies for guidance on practice valuations, profitability consulting, and exploring the best transition options for your unique goals.

How Partnering with a DSO Can Help Preserve Your Dental Practice’s Legacy

Professional Transition Strategies Consultant Kim McCleskey recently joined The DrBicuspid.com Podcast to discuss the current economic climate and its implications for dentists interested in selling their practices now or in the future. With 30 years of experience in the industry, McCleskey provided valuable insights into the evolving landscape of dental practice ownership. Here’s a summary of the podcast conversation.

 

Understanding the Current Economic Climate

McCleskey highlighted the current state of the dental industry, noting that it is approximately 35% consolidated, which is about halfway through the consolidation wave taking place. Consolidation is projected to reach the full 60-70% within the next 5-7 years, signifying a paradigm shift in the industry’s investment dynamics. With a growing number of practices falling under private-equity backed DSOs, the influx of investor capital will eventually slow. McCleskey emphasized the significance of this shift, as it will fundamentally alter the ownership landscape of dental practices.

Urgency in Decision-Making

With the impending wave of dental consolidation, there is a sense of urgency for dentists to consider their options. McCleskey discussed the pressure on dentists to sell now versus potentially waiting. Your options in the next three to four years following the peak of consolidation are going to decrease and change, she noted. She also stressed the importance of dentists understanding their options and making informed decisions to navigate this evolving landscape effectively.

Treating Dental Practices as Businesses

McCleskey underscored the importance of treating dental practices as businesses and understanding their profitability and value. The first step down this path is to get dialed into conversations about profitability. Working with experts like PTS to create a prospectus can help you understand your business and options, whether you’re selling to an individual or a DSO. This business-oriented approach ensures dentists make informed decisions that enhance the financial health and marketability of their practice.

Preparing Your Practice for Sale

The dental industry consolidation wave is nearing its peak, with only one to two rounds of recapitalization events likely remaining. Translated for your practice: This is a limited-time opportunity to maximize your wealth through a sale. For instance, for a practice valued at $2 million with $500,000 EBITDA (earnings before interest, taxes, depreciation and amortization), it can be a difference between selling for $2.75 million vs. $3.25 million for the same deal with two recapitalization events. Don’t miss out on the chance to capitalize on a strong seller’s market.

In preparation to sell, it’s imperative to build the profitability of your practice and its infrastructure now. McClesky advises that if you want to use your practice as an investment vehicle, now is the time to make sure your practice has the kind of value that will help with your personal and professional goals. She advises that it’s never too early to have an understanding of where your business is and to have a valuation done to understand what you can do differently to move the needle in your favor for when it comes time to sell.

Exploring Alternative Options

Selling to a DSO is a great option for many dentists, especially for those with practices that aren’t currently profitable and are considering retirement. Instead of closing up shop and walking away with nothing, DSOs offer an alternative that can help improve profitability and secure a better outcome for your practice.

McCleskey emphasized the importance of understanding the range of deal options DSOs provide. DSOs provide various deal structures tailored to meet different needs and goals. These include outright sales, equity rollovers, joint ventures, 100% buyouts and hybrid options. Each type of deal offers unique benefits, such as maintaining some level of ownership, receiving ongoing income or benefiting from the DSO’s resources and support to enhance practice profitability.

DSOs can help transform an unprofitable practice into a more valuable asset, offering a practical and profitable exit strategy for dentists close or ready to retire. By leveraging these options, dentists can find a deal structure that aligns with their personal and professional objectives.

What’s Next?

McCleskey’s insights shed light on the current economic climate of the dental industry and its implications for dentists. With the industry poised for significant consolidation in the coming years, dentists must understand their options and make strategic decisions now to secure their future success. 

Listen to the recent episode of The DrBicuspid.com Podcast featuring McCleskey to gain insights on the pressing market dynamics and understand if now is the right time to consider selling.

Contact the experts at Professional Transition Strategies for guidance on practice valuations, profitability consulting, and exploring the best transition options for your unique goals.

What Sets PTS Apart?

Professional Transition Strategies Consultant Kim McCleskey recently joined The DrBicuspid.com Podcast to discuss the current economic climate and its implications for dentists interested in selling their practices now or in the future. With 30 years of experience in the industry, McCleskey provided valuable insights into the evolving landscape of dental practice ownership. Here’s a summary of the podcast conversation.

 

Understanding the Current Economic Climate

McCleskey highlighted the current state of the dental industry, noting that it is approximately 35% consolidated, which is about halfway through the consolidation wave taking place. Consolidation is projected to reach the full 60-70% within the next 5-7 years, signifying a paradigm shift in the industry’s investment dynamics. With a growing number of practices falling under private-equity backed DSOs, the influx of investor capital will eventually slow. McCleskey emphasized the significance of this shift, as it will fundamentally alter the ownership landscape of dental practices.

Urgency in Decision-Making

With the impending wave of dental consolidation, there is a sense of urgency for dentists to consider their options. McCleskey discussed the pressure on dentists to sell now versus potentially waiting. Your options in the next three to four years following the peak of consolidation are going to decrease and change, she noted. She also stressed the importance of dentists understanding their options and making informed decisions to navigate this evolving landscape effectively.

Treating Dental Practices as Businesses

McCleskey underscored the importance of treating dental practices as businesses and understanding their profitability and value. The first step down this path is to get dialed into conversations about profitability. Working with experts like PTS to create a prospectus can help you understand your business and options, whether you’re selling to an individual or a DSO. This business-oriented approach ensures dentists make informed decisions that enhance the financial health and marketability of their practice.

Preparing Your Practice for Sale

The dental industry consolidation wave is nearing its peak, with only one to two rounds of recapitalization events likely remaining. Translated for your practice: This is a limited-time opportunity to maximize your wealth through a sale. For instance, for a practice valued at $2 million with $500,000 EBITDA (earnings before interest, taxes, depreciation and amortization), it can be a difference between selling for $2.75 million vs. $3.25 million for the same deal with two recapitalization events. Don’t miss out on the chance to capitalize on a strong seller’s market.

In preparation to sell, it’s imperative to build the profitability of your practice and its infrastructure now. McClesky advises that if you want to use your practice as an investment vehicle, now is the time to make sure your practice has the kind of value that will help with your personal and professional goals. She advises that it’s never too early to have an understanding of where your business is and to have a valuation done to understand what you can do differently to move the needle in your favor for when it comes time to sell.

Exploring Alternative Options

Selling to a DSO is a great option for many dentists, especially for those with practices that aren’t currently profitable and are considering retirement. Instead of closing up shop and walking away with nothing, DSOs offer an alternative that can help improve profitability and secure a better outcome for your practice.

McCleskey emphasized the importance of understanding the range of deal options DSOs provide. DSOs provide various deal structures tailored to meet different needs and goals. These include outright sales, equity rollovers, joint ventures, 100% buyouts and hybrid options. Each type of deal offers unique benefits, such as maintaining some level of ownership, receiving ongoing income or benefiting from the DSO’s resources and support to enhance practice profitability.

DSOs can help transform an unprofitable practice into a more valuable asset, offering a practical and profitable exit strategy for dentists close or ready to retire. By leveraging these options, dentists can find a deal structure that aligns with their personal and professional objectives.

What’s Next?

McCleskey’s insights shed light on the current economic climate of the dental industry and its implications for dentists. With the industry poised for significant consolidation in the coming years, dentists must understand their options and make strategic decisions now to secure their future success. 

Listen to the recent episode of The DrBicuspid.com Podcast featuring McCleskey to gain insights on the pressing market dynamics and understand if now is the right time to consider selling.

Contact the experts at Professional Transition Strategies for guidance on practice valuations, profitability consulting, and exploring the best transition options for your unique goals.

The Ultimate Guide to Practice Transitions

Professional Transition Strategies Consultant Kim McCleskey recently joined The DrBicuspid.com Podcast to discuss the current economic climate and its implications for dentists interested in selling their practices now or in the future. With 30 years of experience in the industry, McCleskey provided valuable insights into the evolving landscape of dental practice ownership. Here’s a summary of the podcast conversation.

 

Understanding the Current Economic Climate

McCleskey highlighted the current state of the dental industry, noting that it is approximately 35% consolidated, which is about halfway through the consolidation wave taking place. Consolidation is projected to reach the full 60-70% within the next 5-7 years, signifying a paradigm shift in the industry’s investment dynamics. With a growing number of practices falling under private-equity backed DSOs, the influx of investor capital will eventually slow. McCleskey emphasized the significance of this shift, as it will fundamentally alter the ownership landscape of dental practices.

Urgency in Decision-Making

With the impending wave of dental consolidation, there is a sense of urgency for dentists to consider their options. McCleskey discussed the pressure on dentists to sell now versus potentially waiting. Your options in the next three to four years following the peak of consolidation are going to decrease and change, she noted. She also stressed the importance of dentists understanding their options and making informed decisions to navigate this evolving landscape effectively.

Treating Dental Practices as Businesses

McCleskey underscored the importance of treating dental practices as businesses and understanding their profitability and value. The first step down this path is to get dialed into conversations about profitability. Working with experts like PTS to create a prospectus can help you understand your business and options, whether you’re selling to an individual or a DSO. This business-oriented approach ensures dentists make informed decisions that enhance the financial health and marketability of their practice.

Preparing Your Practice for Sale

The dental industry consolidation wave is nearing its peak, with only one to two rounds of recapitalization events likely remaining. Translated for your practice: This is a limited-time opportunity to maximize your wealth through a sale. For instance, for a practice valued at $2 million with $500,000 EBITDA (earnings before interest, taxes, depreciation and amortization), it can be a difference between selling for $2.75 million vs. $3.25 million for the same deal with two recapitalization events. Don’t miss out on the chance to capitalize on a strong seller’s market.

In preparation to sell, it’s imperative to build the profitability of your practice and its infrastructure now. McClesky advises that if you want to use your practice as an investment vehicle, now is the time to make sure your practice has the kind of value that will help with your personal and professional goals. She advises that it’s never too early to have an understanding of where your business is and to have a valuation done to understand what you can do differently to move the needle in your favor for when it comes time to sell.

Exploring Alternative Options

Selling to a DSO is a great option for many dentists, especially for those with practices that aren’t currently profitable and are considering retirement. Instead of closing up shop and walking away with nothing, DSOs offer an alternative that can help improve profitability and secure a better outcome for your practice.

McCleskey emphasized the importance of understanding the range of deal options DSOs provide. DSOs provide various deal structures tailored to meet different needs and goals. These include outright sales, equity rollovers, joint ventures, 100% buyouts and hybrid options. Each type of deal offers unique benefits, such as maintaining some level of ownership, receiving ongoing income or benefiting from the DSO’s resources and support to enhance practice profitability.

DSOs can help transform an unprofitable practice into a more valuable asset, offering a practical and profitable exit strategy for dentists close or ready to retire. By leveraging these options, dentists can find a deal structure that aligns with their personal and professional objectives.

What’s Next?

McCleskey’s insights shed light on the current economic climate of the dental industry and its implications for dentists. With the industry poised for significant consolidation in the coming years, dentists must understand their options and make strategic decisions now to secure their future success. 

Listen to the recent episode of The DrBicuspid.com Podcast featuring McCleskey to gain insights on the pressing market dynamics and understand if now is the right time to consider selling.

Contact the experts at Professional Transition Strategies for guidance on practice valuations, profitability consulting, and exploring the best transition options for your unique goals.

What It’s Like to Work With a Dental Practice Broker

dentist with hands folded and looking at the floor

Transitioning a dental practice, whether you’re selling or merging, is a significant milestone in any dentist’s career. This journey, while full of opportunities, is also full of emotional challenges. Understanding and addressing these often overlooked emotional aspects is key to a smooth and successful transition. This article explores the various emotional facets of transitioning your dental practice and provides strategies to manage them effectively.

Coping With the Stress of Selling or Merging

The process of selling or merging a dental practice can be overwhelming. It involves many decisions, from financial considerations to logistical details. And, it isn’t just a professional change; it’s a significant life event that can impact your mental health. On top of that, dentistry is already a stressful job, with more than half of dentists experiencing high job stress according to a study from Nature (1). Recognizing this and taking proactive steps to manage your emotional well-being is essential for a successful transition.

Identifying Common Stressors

  • Uncertainty: The unknowns associated with the transition can create anxiety about the future direction of the practice and personal career path.
  • Workload: Balancing current practice demands while planning for the transition can lead to burnout. Selling a practice typically requires about 150 hours, spreading dentists thin between clinical care, business management and transition planning.
  • Financial Pressure: Large investments or holding a significant amount of debt can be scary and overwhelming. When investing in a dental practice, enlist experts to provide critical support, such as knowledge of medical or dental competition, patient demographics and expertise in practice appraisals to determine fair market value. For potential sellers, partnering with a dental service organization (DSO) often includes “cash at close,” providing immediate financial relief to clear debts and enhance financial stability for future endeavors.
  • Concerns With Exiting a Partnership: Transitioning out of a dental practice partnership is often complex, especially when one partner plans to retire while the other intends to continue practicing. This scenario often leads to divergent paths and requires careful planning to ensure a smooth transition for both parties. DSOs can offer structured solutions and support in navigating these transitions, facilitating agreements that accommodate different career aspirations and personal goals.
  • Worries About Clinical Autonomy in a DSO Transition: Modern DSOs offer varying levels of involvement, so finding one with your clinical and cultural values is crucial to preserving professional independence and patient care standards. To find the best fit, evaluate their support infrastructure and commitment to clinical autonomy. With over 375 DSOs available, an experienced broker can help identify those that align with your values and avoid those that might impose unwelcome changes.
  • Navigating Industry Shifts: The dental industry is currently undergoing significant consolidation, with approximately 35% of practices already consolidated (3) into DSO groups. This ongoing consolidation adds stress as practitioners must act soon amidst changing market dynamics to capitalize on the current opportunity before it’s too late.
  • Choosing the Best Option: It’s stressful when weighing multiple options before deciding on the best path forward for both personal and professional goals. When considering options for transitioning your practice, especially as a potential seller, it’s essential to weigh various deal structures available with DSOs, which include options such as an equity roll, joint venture model or outright sale to a DSO. Each structure offers different benefits and considerations, such as the financial incentives discussed in DrBicuspid.com (2), operational autonomy and future growth potential.

Strategies for Managing Stress

  • Plan Ahead: Create a detailed transition plan to minimize last-minute surprises. We always recommend starting the planning process at least five years before you want to transition your practice.
  • Delegate Tasks: Delegate responsibilities to trusted staff or consider hiring temporary assistance for help running the business during peak workload periods. Clearing non-essential tasks from your plate allows you to focus more on patient care and strategic planning.
  • Prepare To Sell: Effectively prepare by conducting a practice appraisal, which identifies opportunities to maximize profitability and enhance your practice’s overall value before listing it for sale. By optimizing financial and operational efficiency, you not only enhance your practice’s appeal but also navigate the selling process with greater confidence and reduced stress.
  • Seek Professional Help: Engaging with expert brokers like Professional Transition Strategies provides strategic guidance tailored to your goals and can support you in navigating negotiations, ensuring financial transparency and devising long-term growth strategies. This personalized counsel empowers dental entrepreneurs to make informed decisions that align with their personal vision for practice ownership, alleviating stress by knowing they have the best expertise guiding them every step of the way.

Managing Staff Emotions During Transitions

Your staff plays a critical role in your practice, and their emotions and reactions during a transition can significantly impact the process. It’s essential to avoid prematurely notifying staff about potential changes before the sale is finalized. Doing so could lead to significant disruptions and uncertainties among the team. Here’s how to approach communication effectively once the sale is complete:

Transparent Communication With Staff

  • Timing of Communication: Wait until the sale is complete before informing your staff about any impending transitions or changes. Premature communication can create unnecessary anxiety and speculation. Once the sale is finalized, it becomes appropriate to inform your staff about the upcoming changes to help mitigate uncertainties and alleviate fears.
  • Keep Them Informed: Regular updates about the transition can help alleviate fears and uncertainties. Clearly explain the steps involved in the transition and what it means for the staff.
  • Highlight Benefits: Discuss the potential benefits that come with the transition, whether it’s new career growth opportunities, enhanced benefits or improved working conditions.
  • Showcase Improvements: Inform staff about any improvements that will come with the transition, such as new technology, better facilities or expanded services.
  • Provide Support: Offer resources and support to help staff cope with the changes. This might include workshops or one-on-one meetings to address individual concerns.

Staff Benefits from DSO Transitions

Transitioning to a DSO can provide your staff with numerous benefits that enhance their professional and personal lives. DSOs are structured to offer comprehensive benefits, including health care and a 401K plan, from the outset. For hygienists and other dental professionals, DSOs present a well-defined career path with clear job opportunities. This structured approach allows staff to understand and plan their potential career progression. Moreover, DSOs invest in the latest technology, which not only improves the clinical experience for staff but also keeps them engaged and motivated. Overall, DSOs provide a supportive and structured environment that can greatly enhance job satisfaction and career growth for dental practice employees.

Dealing With Uncertainty

Change, even when positive, can trigger feelings of uncertainty and fear. Recognizing and addressing these emotions is essential for a smooth transition.

Coping Mechanisms

  • Acknowledge Your Feelings: Accepting and understanding your emotions can help you manage them better.
  • Stay Positive: Focus on the benefits and opportunities that the transition will bring.
  • Seek Support: Talk to colleagues, friends or a trained professional to help process your feelings. Connecting with other dentists who have undergone a similar practice transition can provide valuable insights and alleviate fears, or help identify DSO groups that may be a good fit if you’re considering selling your practice. Understanding their experiences with different DSOs can guide your decision-making process and ease concerns about the transition. Additionally, partnering with a seasoned dental practice broker can assist in identifying your ideal buyer, easing any worries you might have.

Balancing Personal and Professional Life

A transition can disrupt the delicate balance between your personal and professional life. It’s important to find ways to maintain this balance to ensure overall well-being.

Ensuring Self-Care During the Transition

  • Set Boundaries: Allocate specific times for work and personal activities.
  • Trust Your Team: Entrust responsibilities to your team to avoid overburdening yourself.
  • Take Breaks: Regular breaks and time off can help prevent burnout.

Financial Considerations and Emotional Well-Being

Financial aspects of a transition can significantly impact your emotional well-being. Proper financial planning and management can alleviate stress and ensure a smoother transition. These steps ensure that financial considerations are carefully managed throughout the transition process, providing financial stability and peace of mind.

Financial Planning Tips

  • Merging Dental Practices: When merging practices, it’s crucial to budget for integration costs, potential redundancies and any legal or regulatory expenses involved. An experienced dental broker can help navigate the complexities of combining financial systems and aligning revenue streams to ensure a seamless transition.
  • Selling a Dental Practice: Planning for a successful sale involves conducting a thorough practice appraisal to determine its fair market value and identifying and vetting potential buyers – both groups and individuals. Seeking guidance from an expert broker can streamline negotiations and maximize financial benefits from the sale.

Creating a Transition Timeline and Checklist

DSOs fit the dentist who craves a work-life balance and don’t want the added stress of the managerial responsibilities that come along with owning a business. Working 32 clinical hours (instead of six days a week with early mornings) is appealing to both the younger and older generation, especially leading up to retirement and to avoid burnout. For those looking to ease into retirement, working for a DSO can offer an abbreviated schedule rather than the added stress of a transition to another dentist. What’s more, you have the chance to expand and move toward a one-stop-shop model, all while increasing the value of your dental practice.

Developing a Transition Plan

  – Set clear goals: Start by defining what you want to achieve with the transition. This includes your personal and professional goals, financial objectives and career aspirations.

  • Create a timeline: Outline the steps and deadlines for each phase of the transition. Begin planning early to give yourself ample time to address potential challenges and make informed decisions. When selling your practice, you should start the transition process early to allow for strategic positioning of your practice in a competitive environment to source attractive offers.
  • Track progress: Regularly review and adjust your plan as needed to stay on track. Keeping a close eye on your timeline ensures that you remain focused on your goals and can address any issues promptly.
  • Consult an expert: Engaging a dental practice broker can provide numerous benefits, such as enhanced negotiating capabilities, strategic positioning and navigating legal and financial complexities. Brokers can help craft advantageous deal structures and secure more competitive offers, ultimately maximizing the value of your practice transition.

Common Questions

What stresses do dentists face? Why is dentistry the most stressful job?

Dentists face a multitude of stressors that contribute to high levels of anxiety, burnout, and emotional health concerns. According to the ADA’s 2021 Dentist Health and Well-Being Survey, anxiety levels among dentists have more than tripled since 2003, with 16% of respondents reporting anxiety and 13% reporting depression (4). The COVID-19 pandemic has significantly exacerbated these issues, adding unique stressors related to safety, patient management, and operational challenges.

Dentistry is widely recognized as one of the most stressful professions due to factors such as patient anxiety, the demanding precision required, and the physical rigors of the work. The profession’s high standards for accuracy, coupled with the consequences of mistakes, alongside the long hours and physical strain, collectively intensify the stress experienced by dentists.

Why is emotional intelligence important in dentistry?

Emotional intelligence is important in dentistry because it builds patient rapport, enhances team collaboration and improves decision-making. Understanding and addressing patient needs and concerns helps create a positive patient experience. Promoting better communication and cooperation among staff leads to a more harmonious work environment. Additionally, emotional intelligence enables more empathetic and effective decision-making.

How do you make dentistry less stressful?

To make dentistry less stressful, practice self-care, seek support, delegate tasks and stay organized. To alleviate the stress of owning and managing a dental practice, especially without formal business training, many dentists find transitioning to a DSO to be a beneficial option. This transition allows dentists to refocus on clinical care by offloading managerial responsibilities such as marketing, payroll, human resources and recruiting to dedicated professionals within the DSO.

This shift is significant as it enables dentists to return to their passion for clinical work, spending more time chairside with patients.

Bottom Line

The dental industry is currently undergoing significant change, with approximately 35% of practices already consolidated. This ongoing consolidation adds urgency as practitioners must act soon to capitalize on the current opportunity before it’s too late. Delaying your decision could result in missed opportunities, reduced practice value and increased competition.

Begin planning your transition early, seek professional guidance, maintain open communication, and take care of your mental and emotional well-being. Acting promptly and decisively will not only maximize your financial returns but also provide peace of mind as you navigate this significant milestone in your career.

To ensure a smooth and successful transition that addresses both financial and emotional factors, contact the experts at Professional Transition Strategies.

References

  1. Nature, “Dentistry and the stress of practice,” https://www.nature.com/articles/sj.bdj.2019.18
  2. DrBicuspid.com, “4 key financial considerations when selling to a DSO,” https://www.drbicuspid.com/dental-business/practice-sales/article/15678019/4-key-financial-considerations-when-selling-to-a-dso 
  3. DrBicuspid.com, “Halfway Through the Dental Consolidation Wave: What Entrepreneurs Need to Know,” https://www.drbicuspid.com/dental-business/dso/article/15667122/halfway-through-the-dental-consolidation-wave-heres-what-entrepreneurs-need-to-know
  4. ADA, “Survey: Younger Dentists Report Higher Level of Stress, Emotional Health Concerns,” https://adanews.ada.org/new-dentist/2022/february/survey-younger-dentist-report-higher-level-of-stress-emotional-health-concerns/

Corporate Dentistry vs. Private Practice: What Are the Differences

laser dentistry

All dentists who own their practice will eventually reach a point when they’re ready to make a career transition. The circumstances vary by individual dentist. A dentist may decide to sell because they want to retire or move to a new career path altogether. A dentist may assume their only options are to take on an associate — often with an eye toward partnering and an eventual buy-out — or a straight buy-out of their practice. Little do they know, there are more options out there.

Selling a practice to a dental corporation is another option, but if you are a dentist who has thoughtfully built a practice over a number of years, creating a patient-centered business and cultivating a caring team, you might have misgivings about that idea. You may worry that a corporation won’t ensure patients are treated with the same level of care or your staff might be asked to cut corners and short-change patients in the name of profit.

It’s not an unreasonable concern. Committed, highly trained health care providers, like dentists, act in the best interests of their patients, and they don’t like the idea of a bean-counter who doesn’t have the appropriate clinical training weighing in on care plans. That said, it’s important to know there’s a wide range of operating models used by dental corporations. Dental service organizations (DSOs) are an increasingly popular choice for dentists.

DSOs aren’t a monolith — there are many types of DSO arrangements, as they can provide staff and patients with more opportunities while offering financial benefits for doctors. So, it pays to keep an open mind and not write DSOs off as “corporate dentistry.” It’s a good idea for dentists who are planning a career transition to get a better understanding of what DSOs are, why they are gaining marketplace traction, and the pros and cons of working with a DSO. Here’s a closer look at DSOs that can help you make a more informed decision about private practice versus corporate dentistry.

Why more dentists are choosing DSOs

The American Dental Association (ADA) defines a DSO as “entities that dental practice owners contract with to manage the administrative, marketing and/or business sides of that dental practice.” Put another way, they are organizations that handle the non-clinical aspects of a practice. For many dentists, the non-clinical portions of managing the practice are exactly the part they’d willingly hand off to someone else so that they can focus more of their attention on patient care.

DSOs come in all shapes and sizes, ranging from teams that manage a handful of practices to large DSOs that manage more than 1,600 offices. The fact is that fewer dental practices are selling to individuals now than ever before. One reason behind the shift is the high debt load new dentists carry: The average dental school graduate owes more than $290,000 in student loans today, so they are less likely to be in a position to buy a practice.

In addition to the debt load, dental practices have historically been undervalued by banks and an individual dentist is typically beholden to what a bank is willing to lend.

So, why the move toward DSOs? For one, there are simply more DSOs operating today than in the past and their more differentiated than ever, which makes it more likely that a dentist who wants to make a transition will choose a DSO. Also, because DSOs offer a variety of arrangements, dentists are more likely to find a DSO offering terms that help them meet their objectives, such as an arrangement where the dentist stays with the practice to provide patient care but relinquishes management responsibilities. That option could be a good fit for dentists in a variety of scenarios, including those who are planning for retirement in a few years and those who are seeking a better work-life balance.

Another factor that is contributing to the rise of DSOs is that they have a funding advantage. Individual buyers typically rely on bank financing, which can be hard to obtain for some would-be purchasers, particularly in an uncertain economy when banks are tightening standards. DSOs are usually funded by private equity groups, so they can pay more to purchase a practice.

Available DSOs models

Although some dentists may put DSOs under the “corporate dentistry” heading and conclude that selling to a DSO is tantamount to selling out to a corporation, the truth is there are many different types of DSOs. Here’s a brief look at DSO models and how they affect the dentists who sell their practices under each type of DSO investment arrangement.

  • Joint venture: In the joint venture model, the dentist who is selling and the DSO investor both contribute capital in the form of money, equipment and other types of assets into a joint venture, and they share in the growth of the practice proportionally, according to the terms of the joint venture agreement. In this arrangement, the dentist maintains day-to-day clinical control of the practice, and a doctor will often sell between 60% and 70% equity in their practice.
  • Equity roll: This type of arrangement is a group affiliation as opposed to a partnership with a group. In an equity roll, the practice owner sells 100% of the practice and then trades in a portion of their equity into the DSO as a whole.
  • Sub-DSO: In this type of practice transition, the dentist who owns the practice exits the transition debt-free with a substantial upfront payment and typically retains 40% ownership and profit shares in a holding space outside the DSO or practice level. Returns can be made on a variety of levels, including equity, profit sharing and exit after parent DSO recapitalization.
  • Direct investment with private equity: In this model, your practice may be large enough that you don’t need a DSO. You can circumvent the DSO and go directly to private equity. That way, you become a founding member of a DSO.

The key point to keep in mind is that DSOs are not one-size-fits-all. That’s why it’s important for any dentist who is considering a practice transition to be aware of their options, preferably by discussing them with an objective party, like a dental practice broker. It’s not a matter of “corporate dentistry versus private practice” — the terms of the arrangement and the value the selling dentist realizes are the most significant factors.

DSO pros and cons

Dentists who are planning a career transition should think outside the “corporate dentistry versus private practice” box, and it starts by better understanding what a DSO offers. In some situations, DSOs can offer the most value and still enable you to maintain high standards of patient care. But not all DSOs are alike, and neither are dental practice transitions, so it makes sense to review the pros and cons of selling to a DSO, as well as pros and cons of selling to an individual.

For a dentist who is not yet ready to retire but is nearing the end of their career and wants to offload some of the hassles associated with running a practice, a DSO can be a great option. The right DSO can make daily operations easier by handling the business side while the dentist manages clinical decisions. The DSO can handle collections, supplies, marketing and more, increasing profits without the dentist having to focus on business operations.

DSOs typically pay more than individual buyers for a practice because of private equity investment rather than having to use traditional bank financing and can offer other advantages to dentists who are nearing retirement age, including the ability to cash out with a higher valuation. In some scenarios, the dentist works the same or fewer hours after the sale. This approach can accelerate the transition timeline and reduce uncertainty in the retirement planning process.

DSOs can also be a great option for mid-career dentists. Not every dentist enjoys the business side of running a practice, so they may opt for a DSO arrangement to offload the aspects of the operation they don’t want to handle, like human resources and marketing, and focus on what they do best — patient care.

Younger doctors can oftentimes make out better when working with a DSO, especially with a joint venture deal structure. A DSO should help make the practice more profitable; therefore, when the doctor sells the rest of their equity, the value should have increased significantly over the years.

Working with a DSO can help dentists achieve a better balance in their lives, so it may be a good option for doctors who want to spend more time with their families and friends but aren’t yet ready to hang up their white coat just yet.

That said, not all DSOs are a fit for everyone. Like any other category of organization, some are run well, and some are managed poorly. In addition, poorly run DSOs will only focus on the bottom line and not on patient care. They can push unnecessary procedures to benefit their own interests. It’s a good idea to ask a DSO for references, i.e., the names and contact information for dentists who have recently transitioned their practice to the DSO, so you can get an insider’s view of what it’s like working with them.

Exploring options and taking the next step

DSOs aren’t the only practice transition option — fewer practice sales between individual dentists are happening now than in years past, but it’s still an effective and fulfilling route dentists who are planning a practice transition can pursue. Bringing in an associate is still an option, though it has about a 20% success rate. A dentist who is planning to retire can also choose to see fewer patients and eventually just close their doors. It’s important to note that transition plan leaves hundreds of thousands — if not millions — of dollars on the table.

It’s all about finding the right option for the doctor’s transition goals,  whether it be selling to an individual or going the group route. Because finding the right option is important, it’s also imperative to know that the process takes time, and we recommend beginning the planning process up to five years in advance.

The corporate dentistry versus private practice conundrum can be complicated, so the best bet if you are thinking about a practice transition is to find a dental practice broker with the experience and expertise to help you explore the many options available to you. A dental practice broker like Professional Transition Services can help you achieve the best outcome, so don’t go it alone.