Transitions Roundtable: We ask two experts the same question on a complex issue
Two industry experts answer this month's question and provide their professional insights. I’m a periodontist looking to buy a practice. How does this differ from a general practice (GP) transition?
I’m a periodontist looking to buy a practice. How does this differ from a general practice (GP) transition?
Typically, a general dentist practice can be turned over to the buyer as soon as sale agreements are signed and money changes hands. My patient loss for general practice transitions, if properly done, is less than 2%. However, a specialist transition is another story. This can be like herding cats, so be prepared.
The role of the periodontist seller is to make the practice referral sources comfortable with the new buyer. As I tell my perio sellers, “Now is the time to cash in your chips with your referral colleagues.” Hopefully, these relationships are long-term and mutually satisfactory, so that the referral sources will give the buyer a chance.
I usually recommend a transition period of at least 90 days. During this time, the seller will introduce you to the referral sources and their staffs. It is up to you to present a good initial impression, both clinically and personally.
Perio practices are facing a challenging future. General dentists are keeping more perio procedures in-house and resisting perio maintenance done by the periodontist. This impacts practice profitability and growth. So, it is critical that the transition be done properly.
SCOTT FROUM, DDS
Buying a periodontal practice can differ from buying a general practice in a few ways. When you look at a perio practice, the most important feature from my perspective is, where are the new patients coming from?
Is the practice an established practice with word-of-mouth referrals, an Internet referral-based practice, or a practice that has a general practitioner/prostho referral system? If it is the latter, then you have to look at who the referrals are and whether or not you can continue this type of relationship.
That referral source might dry up for several reasons, such as if you and the general practitioner have differing practice philosophies. If you think that you will not be able to continue the relationship with the referring dentists, then that consideration has to be added into the valuation of the practice.
Gary Schaub, the owner of HELP Appraisals & Sales Inc. in Oregon, has over 25 years of experience in health care and dental practice appraisals, sales, and transitions. With a background in electrical engineering and a master’s degree in business administration, Mr. Schaub understands the intricacies of medical and dental practice transitions.
Scott Froum, DDS, a graduate of the State University of New York, Stony Brook School of Dental Medicine, is a periodontist in private practice at 1110 2nd Avenue, Suite 305, New York City, New York. He is the editorial director of Perio-Implant Advisory and serves on the editorial advisory board of Dental Economics. Dr. Froum, a diplomate of the American Board of Periodontology, is a clinical associate professor at SUNY Stony Brook School of Dental Medicine in the Department of Periodontology. He serves on the board of editorial consultants for the Academy of Osseointegration's Academy News. Contact him through his website at drscottfroum.comor (212) 751-8530.