Adding additional practices comes with financial, management, and logistical factors that all need to be carefully considered. Additional practices always have a direct impact on the career and financial well-being of the dentist. It’s best to know all the ramifications of owning a small group practice before you begin building one.
Start with a plan. Many small group practices are cobbled together almost by accident. For example, a dentist may have the opportunity to buy out a failing practice, followed by buying out the practice of a retiring dentist, followed by identifying a hot new area that’s perfect for a new practice.
Each of these decisions is independent and not part of a medium- or long-range plan. Without a concrete plan, the dentist may later find that he or she is overextended financially or that the hot new area isn’t as hot as they thought. Gaining economies of scale may be the primary benefit of building a group practice. The absence of a strategic plan will almost guarantee that you will not experience this important benefit.
Don’t forget to check out the competition. A competitive analysis for each area where a future practice will be opened can help you understand how changes in the area might affect your small group practice.
Dr. Roger P. Levin is CEO of Levin Group, a leading practice management and marketing consulting firm. To contact him or to join the 40,000 dental professionals who receive his Practice Production Tip of the Day, visit LevinGroup.com or email [email protected].
The comments and observations expressed herein do not necessarily reflect the opinions of DrBicuspid.com, nor should they be construed as an endorsement or admonishment of any particular idea, vendor, or organization.
