Dentaltown July 2022 - 70

by Jay Geier
Jay Geier is an authority on growing
independent practices. His passion is
in turning practices into businesses,
doctors into CEOs, and employees into
high-performing individuals and teams.
Geier is the founder and CEO of Scheduling
Institute, a fi rm that specializes in training
and development and coaching doctors
in turning practices into businesses,
doctors into CEOs, and employees into
high-performing individuals and teams.
and development and coaching doctors
on how to transform their private practices into thriving
businesses. Subscribe to his Private Practice Playbook podcast at
podcastfordoctors.com/dtown.
Protect Your
Private Practice
I
derive tremendous satisfaction from teaching independent
practice owners the benefi ts of not selling their
practices and the strategies for earning passive income
from the day they retire for the rest of their lives (and
even those of their heirs).
But not everyone chooses that route. If you decide that
selling is the better choice, the key to successfully navigating
that path is to recognize the pitfalls so you can avoid them,
be in control every step of the way and be able to make
well-informed, fact-based decisions. The alternative is to fall
victim to a buyer's pressure tactics that could cost you dearly,
fi nancially and emotionally.
Understand the value of what you have
If you've never paid to have a professional appraisal done
on your business, you undoubtedly underestimate its value.
You're likely to think only in terms of what you might be
able to sell it for today, but a quality appraisal will assess
both current and future value from your standpoint-not
the buyer's-by factoring in a steady revenue stream and
long-term growth potential.
I am especially critical of DSOs for using this fact to
their advantage. They approach independent practice owners
and offer to have an appraisal done for free, which is an
70 JULY 2022 // dentaltown.com
inherent confl ict of interest because it allows the buyer to set
the price. That's because the business model for DSOs is to
essentially fl ip practices-buy as inexpensively as possible,
cut costs and staff and resell for as much as possible.
Most DSOs are backed by private equity fi rms whose
only objectives are short-term profi t and maximum resale,
typically within fi ve to seven years. Their interests have
nothing to do with patient experience, employee culture
or community involvement. They won't invest in improvements,
and they will strip out many of the things that made
you proud to own your practice and attracted patients to it.
Hence the double whammy-the fi nancial hit of being
lured to sell your life's work for less than it's worth, and the
emotional hit of having to witness the dismantling of what
you built. Even worse, because you're likely to be kept on as
an employee of the new business for several years, you will
be made to feel all the negative changes are taking place with
your blessing, even though you now have zero say-so in any
aspect of practice management.
Keep your options open
My second-biggest criticism about DSOs is their attempt
to lock practice owners into a relationship before
they've have had time to do their homework or get legal ad
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Dentaltown July 2022

Table of Contents for the Digital Edition of Dentaltown July 2022
