The New Professional Column

Start with the financials, because they’re the backbone of any purchase. Ask for at least three years of tax returns and profit-and-loss statements, and take the time to understand what they mean. Collections, overhead, and net income give you a snapshot of health, but it’s the patterns over time that really matter. If production has dropped, was it because the seller cut back hours or because patients stopped coming? A dip caused by reduced schedules may not be a red flag, but a shrinking patient base should make you cautious. Also, don’t overlook accounts receivable. Any business can look profitable on paper yet struggle to collect what’s owed. And, take note of the insurance mix, because if the practice leans too heavily on one plan, a change in reimbursement rates could shake the bottom line.

Still, numbers only tell part of the story. Patients are the heart of a dental business, and understanding them is critical. Look closely at how many are “active,” which is typically defined as being seen in the past 18 to 24 months, and how many new patients come in each month. Just as important is the community the practice serves. Are you stepping into a neighborhood of young families, retirees, or a more transient population? Each will shape the kind of dentistry you’ll be doing and the long-term potential for growth. And remember, patients often stay loyal to the doctor, not just the practice. If the seller is beloved for personal relationships, you may see some attrition after the transition. But if loyalty is tied to strong systems and great staff, the base will be far more secure.

Speaking of staff, don’t underestimate their role in your success. An experienced, welcoming team can make all the difference. They know the patients, the systems, and the flow of the office. On the other hand, high turnover or an unhappy team can create stress right when you need steadiness the most. When evaluating a practice, pay attention to the culture: how the team interacts with each other, how they greet patients, and whether the atmosphere feels warm or rushed. You’ll be inheriting that culture, so make sure it’s one you want to lead.

Facilities and equipment are another area to weigh carefully. The number of operatories, the condition of the equipment, and the technology in use will affect both how you work today and what you may need to invest in tomorrow. Location matters too. Accessibility, parking, and visibility all influence new patient flow and can’t be fixed as easily as old chairs or computers.