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The tricky path from dental school to dental practice

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Although it’s been a few years since I walked out of dental school with my degree in hand, I still think about new graduates going from the halls of academe to their careers in a dental office.

When today’s dentists start their career, most will be unable to purchase a practice. A quarter million dollars of student debt will make certain of that. Further, most lack the basic business knowledge to run a small or medium size business. If that seems odd, it’s because since they entered high school, the sciences have been their focus and following that, four years of an intense dental education.

Fix a tooth? Easy. Seeking out suppliers? Not so much.

So it’s been encouraging to hear that most dental schools are starting to provide at least sixteen hours of practice management education. The goal is to prepare these young businessmen and women how to make sound business decisions. Are they going to join a group practice, corporate dentistry, become an associate with an existing practice? Ideally this training will help them dovetail these options with their own personalities, ambitions and drive to find the right path to follow.

Consider the private practice option.

In my experience if a dental student is considering going it alone, the process should be begin in dental school.

They likely know that after the graduation accolades fade, the reality of starting their professional life will come rushing at them faster than their first loan repayment installment.

There are several stages that a practice goes through when you’re looking to either purchase or start your own.

Stage one is simply opening up one’s own practice de novo: put a shingle on the door, market the hell out of the practice and yourself and hope to God you have a patient base to both support your debt and provide an income that’s necessary for you to survive. In general, you will need approximately 1,800 active patients, meaning that those clients come to your office at least every 18 months to make it work.

Sound impossible? Most realize it is, which is why it’s done so rarely right out of dental school. Many opt for a way to ensure steady income while they pay down their student debt and put their solo dreams on hold.

If you are considering starting up your own practice, I offer personal coaching for dentists help you navigate the business end of dentistry. It may be the wisest investment you make because I can quickly tell you whether or not this is a smart decision.

And if you do go through with it I’m here with over 30 years experience running 14 practices to help you implement the processes and procedures to help you build the practice of your dreams.

Corporate dentistry not friend or foe

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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.

Ownership still has it’s privileges

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When you own a practice as part of a chain, you have certain obligations to the franchise. At times it can feel like you aren’t your own boss although shedding a bit of  professional sovereignty yields considerable benefits.

The most important of these is that you don’t really have to put too much thought into how you run your practice. Or at least that’s how many owner/dentists tend to approach things.

But what happens is that you start thinking about your services as products to be sold rather than treatments for patients. So your practice becomes a glorified assembly line. Where treatments are ranked based on price and not necessarily patient need.

I recently told the story of an elderly couple who came into my practice facing either a pricey root canal, or a simple extraction. Obviously a short term win for me would have been the root canal. But then given the patient’s age and medical history, would that have been the right choice? Of course not. So we did the extraction.

If someone owns a practice that is part of a chain they could theoretically still offer advice to a patient that would save them money.

Doing so would create loyalty with that customer and make their operation stand out among the other chain services lining the streets.

So why don’t more do this? Depressingly, it could be because it doesn’t matter.

Being part of a chain means a steady flow of customers drawn in because of the brand. Word of mouth means little. A chain store is a chain store is a chain store, right? Is your local Starbucks any worse or better than the one down the street? Does it really matter if someone is just looking for a coffee?

Well yes and no. Because a business person can have their cake and eat it too. They can operate under a chain and deliver superior service with an eye to getting return business, loyalty and word-of-mouth.

What’s the cost? Very little if one puts the cost of saving customers money against the cost of regional marketing and advertising budgets.

But there is a very real reason why individual service initiatives don’t often happen in a chain store. Simply put, most dentists working in chain operations only stay for two years. Any quality service improvements will ultimately just frustrate the next dentist who may not have the same integrity.

So what to do? As a customer, I always choose the independent operator.  It doesn’t mean I don’t trust the chains. I simply want my dentists to have more of a long term investment in myself and my community.

When the chains make this a part of their business model, maybe they’ll even be able to retain some of their best talent beyond that two year mark.