Tune in to our podcast series: The Dental Board Room
Listen Now
Buying a dental office should be the moment your career shifts into a higher level of income and control. But that only happens when you choose the right practice. A strong office can give you predictable production, a steady patient base, and a better work-life. The wrong office can keep you stuck at associate-level income while carrying a large loan.
Most buyer setbacks come from misreading the practice they are trying to purchase. These three mistakes are common, costly, and completely avoidable when you know what to look for.
Many new buyers focus on one number: the seller’s recent revenue. This is one of the worst ways to judge a practice. The seller’s production reflects the seller’s skills, speed, treatment style, and clinical habits. None of these may match yours.
Several issues hide behind high collection numbers:
Some sellers produce a heavy volume of crowns, implants, or larger cases. If every patient has fresh restorative care, there is nothing left for you to diagnose. You step in and suddenly numbers drop because your hands have nothing to do.
If a seller is extremely aggressive or extremely fast with crown placement, you may not match their pace. Your income then falls short of the financial reports you reviewed.
You should be asking:
What will the practice produce once I own it?
That answer rarely matches last year’s statement.
A year with many crowns looks strong, but those cases do not repeat yearly. A year with under-diagnosed hygiene patients looks weak, yet may carry more long-term potential for you.
A financial statement is a starting point. It is not a guarantee of your income.
Most buyers look at patient count. Few look at patient value. This is a major mistake.
A practice might have 1,000 active patients and still be a weak buy. Another practice might have 1,200 or 1,800 patients and be a far better long-term fit. The transcript gives a clear example that shows why:
This often means the seller has already completed nearly every major restorative procedure. The patient base is fully restored. You walk into an office where patients need cleanings, occasional fillings, and not much more.
Your production potential drops right away.
This is a high opportunity practice. Many older sellers reduce their treatment planning over time. They do not provide full care. They only treat the tooth that hurts.
When you review charts, you often find:
This gives the buyer a natural path to growth without advertising or long marketing campaigns.
A practice with weak seller production can outperform a “high production” practice once you step in with proper diagnosis.
Opportunity matters more than last year’s collections.
The seller’s financials do not match your financials. This is one of the biggest misunderstandings buyers face.
Once you close, several major expenses shift right away.
If the seller owns the building, they may be paying themselves below market rent. You will not have that arrangement.
Your rent may double or rise significantly.
If the seller’s spouse was the office manager, you now need a paid employee. If a family member was underpaid, you need a replacement at the market rate.
Your payroll can climb immediately.
The seller often has no practice loan during the final years. You do. That payment reduces your take-home income each month.
You may not qualify for the same plans the seller accepted.
Delta Premier is a common example. Some sellers are paid far more per crown than new owners will be.
Your fees may be lower for the same work.
Your tax structure shifts from associate pay to owner income with overhead, payroll, and debt to consider.
This is why the smart buyer does not ask, “How much did the seller take home?”
The real question is, “What will I take home after overhead, debt, and taxes under my name?”
Buying the right dental practice can double your income and give you more control over your schedule. Buying the wrong one can leave you stuck, frustrated, and unable to grow.
You avoid these outcomes by:
When you evaluate a practice with these points in mind, you give yourself a much safer and stronger path into ownership.
Watch the complete podcast episode for a deeper look at how to review a dental practice before you buy.
Wes knows what's best for dental practices. He's been doing this for a long time and he sees lots of practices. He can tell me how our practice is doing, and what we can do to increase our productivity. With past CPA's, there were no ideas. It was all coming from me, saying "I think I can do better, but I don't know how." I come in to meet with Wes and he says "You CAN do better, and I know how."
PracticeCFO is in hundreds of dental offices around the country. They know what numbers should look like. They know what percentages of payroll, rent and supplies should be, and they will hold you accountable to those numbers, which will really help you stick to your plan and your path of growth and savings. That is invaluable
Whenever something comes up, whether it's building or practice related and we weren't sure where the numbers would go, PracticeCFO has been instrumental in helping us figure that out. I can't say enough of how important that is - that it goes beyond that initial partnership. They make sure this business marriage works.
When I go home from work, I don't spend a whole lot of time stressing about what my books look like, or how much I owe in taxes. By using PracticeCFO, the burden of keeping track of a lot of the big financial numbers and metrics are taken off my plate.
PracticeCFO helped me develop a plan for the future. I have colleagues that work with other accountants that don't have a plan - they just look at the numbers of the practice and that's it. There's no plan for 10, 20 years from now. But with PracticeCFO, you get that. PracticeCFO makes you feel like you're they're only client.
(In reference to his practice sale) What could've been super stressful, wasn't! When picking John and Wes, it was from word of mouth recommendations and other people's experiences from the past that really did it for me. And it turns out that those recommendations were right on the line.
Wes knows the business side of dentistry. His comprehensive plan will organize your personal and professional finances so you can focus on taking care of patients. Massive ROI.
I can’t say enough good things about everyone at PracticeCFO. Everyone on the team is professional, organized, knowledgeable, helpful and kind. They also respond to emails and phone calls immediately and are always happy to help. They have helped me navigate year-to-year as a business owner. PracticeCFO gives me peace of mind that my business is in good hands.
I love Practice CFO! They have helped me obtain a practice and maintain a practice. They are incredible people who are on top of everything and make owning and running the business portion of a practice easy. They couldn’t be better for my business and my sanity. They have every detail of the business and taxes taken care of where all I have to do is show up and follow their easy steps to success!
Practice CFO has the best tools I’ve seen for personal tax and financial planning in addition to top-tier corporate tax and accounting services. I have been very pleased with the level of quality service. They manage my monthly bookkeeping and accounts payable. It is a great system and saves me a ton of time, and it allows us to have monthly financial statements within a week of month end.
This will close in 0 seconds
