Corporate dentistry not friend or foe

What’s the fastest growing segment of the dental health care industry? No, not actual dental care methods like braces and tooth replacements. It’s actually corporate dentistry: the organizational DNA of the industry.

Although many of us are aware of the accelerating incursion of dental chains into our industry, it’s worth mulling over the facts for a moment and why it matters.

As a catchall term, corporate dentistry is growing at almost 40 to 45 percent each year. These Managed Service Organizations (usually chains) or Dental Service Organizations (same, except a DSO can be a stand-alone operation) can be owned or invested in by venture capital or equity firms.

It can be argued that such a financial relationship is problematic in practice. Equity firms typically invest short-term so when they get involved in dental firms they’re trying to triple or quadruple their money over a 3 to 7 year timeframe. When they get out and sell to another finance firm, this can be disruptive to the dental operations in that they may have to financially modify or change their models.

Most of these dental practices are run like franchises. Some have a universal look and feel along with strict franchise practices and branding. Others, usually existing dental practices, are allowed to retain their own unique character and feel, with the franchising instead focussing on suppliers and general business practices.

Keep in mind that like with all things there are excellent corporations, less than excellent corporations and poor corporations. The critical aspect is what is their short and long term goals are. And that should be your focus when considering bringing your practice under their system.