So you’re thinking of taking your career to the next level and opening your own dental practice?
Congratulations! But before you set up shop and open your doors to patients, there are some key steps to take on the road to success. Becoming a business owner can be thrilling, lucrative, and professionally enriching, but it can also be a risky venture when you aren’t fully prepared. The short-sighted dentist believes that their dentistry skills and training is all they need to open a successful dental clinic, but the smart practitioner will understand that in addition to scrubs, they also have to put on the hat of ‘business owner’. To ensure that your dental startup is a success story, follow these 10 tips to be on your way to building a thriving dental practice.
1. Research, Research, Research!
Like any major life decision, it’s good to know what you’re getting yourself into. Are you ready to be the boss? Are you fully aware of the financial and legal obligations involved in starting a dental practice? In addition to learning about your responsibilities and expectations, it’s also beneficial to speak to or read about other practitioners who have made the transition from associate to practice owner. Knowing what challenges they faced and what did and didn’t work for them can help you make smarter decisions when you open your own dental clinic. Consider it an exercise in continuing your education.
2. Establish Your Professional and Personal Goals
You likely aren’t ready to retire yet, but it never hurts to think about your career in the long-term, and doing so at the onset of your new practice means you can take steps to reach those goals. Determine and outline what you want to achieve in the future, and how you envision your practice before you begin planning. For example:
What are your production goals and cash flow projections?
Will you be able to service the practice debt (build) in the first few years?
Will you specialize, or offer general dentistry services?
Will you start off as a solo dentist or bring in an associate or two?
How many operatories will you need?
Do you envision yourself expanding
down the line, requiring more space?
Once you have answered some important questions, you can work backwards to create a business plan that will support all of these objectives.
3. Develop an Airtight Business Plan
When you have established your personal and career goals, it’s time to determine how to achieve them. You should think of a business plan as your road map to success, and the framework for your entire practice – and it will also help to secure lenders. A good business plan will contain the following information:
A timeline that includes important milestones and a proposed deadline for each. (i.e. what date would you like to open your doors? When will you need to obtain necessary insurance?)
Key steps broken up into tasks and deliverables (i.e. what measures must be taken to determine if a location is suitable for your practice? What needs to be done before you can sign off on your dental office lease agreement, including drafting the letter of intent
, reviewing the proposed lease, and negotiating the terms to meet your needs.)
Financial forecasts and business/production projections based on market research.
A debt service plan.
A financial plan that includes a detailed budget and breakdown of projected expenses.
Monthly new patient goals.
A marketing plan to ensure your practice production and new patient goals are met.
4. Determine Your Resource Needs
One of the more challenging aspects of running your dental clinic is anticipating its needs before your doors open. For example, will you require a full staff? Do you need a full suite of new dental equipment? Some new dental practices fail by taking on too much too quickly, so it’s best to start slow and build your practice as it expands naturally. You may find it beneficial to speak to an established practice owner about their experience, and learn what type of resources they had in place when they first opened. Remember that you can always scale up, but it’s much harder to scale down.
5. Show Me the Money!
Obtaining financing isn’t usually a problem for dentists for one simple reason: dentists are a good investment, and banks consider dental practices low risk. This knowledge gives you leverage with lenders, so shop around for the best terms for your loan. That being said, you should ensure that your personal credit is in good standing before applying for a practice loan. A lender is also more likely to approve a loan if you can demonstrate good credit, and a strong business plan and growth strategy, which is why the planning stage is so crucial.
6. Team Up with the Experts
Dentistry is a booming industry, and the demand for business solutions partners has created a robust market of specialists who operate exclusively within dental. For a new dental practice owner, this means you won’t, and shouldn’t have to, go it alone! From professional dental office lease negotiators to accountants, to office designers and equipment and supply specialists, these professionals will tailor their services to the specific needs of your startup practice. Enlisting the help of specialists can save you valuable time, help protect your assets, and optimize operations and revenue.
The next steps to starting a dental practice are critical: find a suitable location, review and negotiate the dental office lease for the space, build a marketing and patient acquisition plan, and budget managements. Click here to read Part 2 of our “10 Tips for Starting a Dental Practice” blog series.
Questions about starting a practice or upcoming negotiation?
Contact us for a complimentary lease chat below.