Every once in awhile I like to change things up a bit and look outside of dentistry to help me communicate with my marketing clients. A frequent question I hear a lot is: “Where should I buy my next practice.” As a marketing guy, I should be able to tell them the best markets or at least have access to that information. Unfortunately, it’s not that simple.
The dental industry has adopted a bit of a race to the top mentality. Most dentists who contact me have goals of opening up numerous practices. The main reason is that they feel they need to compete with corporate dentistry. That’s fair but the question I always ask is “Are you getting everything out of the practice(s) you have.”
Every small to medium size DSO organization I work with has practices that are challenges for them. They are unsure as to why some of their practices are thriving why others are barely getting by. There are thousands of reasons for this. The biggest, in my opinion, is they bought practices because they were a great value. They didn’t perfect the practice they had and then seek out areas that have the same footprint.
If you have a thriving cosmetic practice in a high-income part of town you can’t expect to buy a practice in a low-income part of town and have the same success. Same with family practices. Even if you buy in an area with a lot of families that practice may not be established in the community like your current practice. Moms keep a tight grip on the local businesses they refer. It can take quite a bit of time to become part of that conversation.
My recommendation is to not be as concerned with buying that next practice until you are sure you have reached the max potential in the office you have. Another office means more supplies, more staff, more management, and the need for more new patients.
Everyone wants you to do this because the supplier is going to get more money, the banker, the realtor, the accountant, the transition broker, consultants, etc. I even have to include myself as a marketer. We all make more money but we may have excited you into something you didn’t need yet.
The Hardware Store:
Many of us that own homes will spend quite a bit of time in a hardware store. I bought a house several years ago and have spent thousands of dollars and what feels like thousands of hours at the hardware store.
With the Internet, I feel empowered after watching a Youtube video that I can complete any home project. I plan out my project, head to Lowes or Home Depot, buy what I need, and head home confident in my new found skills of roof repair.
Rarely do these projects work out the way I want them to. In all honesty, I usually put myself in danger and end up on a home improvement app to get professional help. “Do it nice or pay for it twice” always comes to mine when I finish paying them.
This changed dramatically when I discovered a local hardware store nearby. I knew it always existed but heard they were really expensive. That was put to the side when I had a drainage issue in my yard. My goal was to see if there was someone there knowledgeable enough to talk me out of doing this myself.
When I went into this place I was amazed. Someone greeted me, asked me what I was coming in for that day. They called over to the garden department and pointed me in the right direction. I was greeted by a man who had been in the industry for over 20 years and knew the most about drainage problems.
I was amazed at his knowledge and showed him pictures of my issues. This guy wrote up a step by step plan on how bringing in some dirt and making drainage canals to two reservoirs would solve my problem. He even gave me the name of a local dirt provider who dropped this off at my house. Then informed me on how to expedite an 811 survey so they would be out in days not weeks to let me know where I could dig. I bought about $100 of tools from him that day but his advice has led me to spend thousands since. I recommend them to anyone with a home improvement project and it’s rare I’m seen in a Lowes or Home Depot these days.
My point to all this is if you have one location that delivers a great patient experience then local people will find out about you. They will also be willing to pay more for your services and most importantly refer you.
Be that go to local practice and duplicate your great patient experience to as many people as you can there first. I know the itch for another practice will be there but don’t scratch it until you can’t service another patient perfectly at your current location. Keep in mind: A three million dollar practice will have a lot less overhead then three one million dollar practices.