It may sound like a recipe for disaster, but according to practice transition specialist Sara Lynch, a partner at Jim Kasper Associates LLC, banks will fund dental practice acquisitions right now. Lynch’s article, “Practice transition marketplace and the current economy” appeared in this month’s Dental Economics.
Gross revenues for dental practices in some areas have dropped 9-14%, Lynch states, and her ideas to weather the economical storm include cutting back on practice hours, beefing up your marketing, or expanding. The article tells us that “sleeper” practices can yield $200K per year – a good little profit to fill the void of lagging revenue. These practices are small dental offices in outlying areas that have little competition. While searching for a hot deal may be a waste of time, investing in a second (or third, fourth…) practice that’s earning a profit is wise in some situations. If a practice’s profits are 75% of gross revenues, banks will usually fund acquisition.
So if you want to make the most of your business in these trying economical times, take a look at Lynch’s article on page 102 of the October 2008 issue. You may also want to review “Recession proofing your practice” from the September issue. For advice on dental practice marketing, contact TNT Dental, the leader in custom dental website design and Internet dental practice marketing.