Looking to open a dental practice but don’t know where to start? Working as a dentist for other practice owners will only take you so far; to take your professional career to the next level, you must open your own practice. Rather than helping to boost the credentials of your competition, all of your hard work will go towards building your own practice. In this post, we’re going to reveal 5 important tips for opening a dental practice.

1. Define Your Service

Before officially opening a dental practice, you should first decide what types of services you want to offer. Some dental practices focus strictly on cleanings, while others perform cosmetic and/or surgical work. The advantage in expanding your services is that you’ll attract more customers and revenue, but the disadvantage is that you’ll likely need to hire associate dentists.

2. Research The Demographic

Another important tip for opening a dental practice is to research the surrounding demographic. Doing a little investigative research into census numbers will reveal key information about the city. Using this information, you can make smarter decisions on how to better run your dental practice.

3. Choose an Easy-To-Find Location

Make sure your dental practice is set up in a location that’s easy for clients to find. If customers are forced to drive down obscure back roads to reach your practice, you can count on some of them taking their business to one of your competitors. Ideally, new dental practices should be set up in a high-traffic  part of town that’s next to a major highway. When customers call to ask for directions, you should be able to provide them in just a few short sentences.

4. Hire an Accountant

Some dental practice owners may brush accountants off as an “unnecessary expense”, but they’re usually worth the price. A professional accountant will help organize your financial documentation, while offering guidance on tax write-offs and other information. Just remember to choose an experienced, licensed accountant that you can trust with your financial documentation.

5. High Population, Low Competition

When choosing a location for your dental practice, look for places with a high population density and low competition. Again, population numbers can be found at your local library, or you can hop online to view records on state-run websites. However, you’ll have to perform your own investigative work to determine the number of competing dental practices in the area.

One of the first steps in launching your own dental practice is choosing a location for it. You can have a team of highly skilled dental assistants and receptionists along with all of the right tools and equipment, but unless your practice is in the right location, you’ll have an increasingly difficult time trying to stay afloat. Location is arguably one of the most important elements for success, as it can either make or break a practice. To learn more about choosing the right location for a dental practice, keep reading.

1. Demographics

When you’re scouting potential locations for your dental practice, do some research into the demographics. There are a number of free-to-use resources and records, found both online and at city planning offices, which offer this information. Look to see how the population numbers have changed in the surrounding area over the past 5-10 years. Have the numbers increased or decreased? If people and businesses are moving away from this area, this is a red flag that should send you packing in the other direction as well. On the other hand, locations with large, dense populations of residents along with businesses are a sign of a healthy thriving economy and infrastructure.

2. Competition

Population numbers aren’t the only factor that should weigh into your decision on choosing a location for your dental practice. Another key factor that will greatly affect your business is the competition. Common sense should tell you that trying to muscle your way into a competitive area with several other dental practices nearby will only make your job more difficult. The fact is that most patients stick with the same dentists for ten or more years; therefore, trying to set up a new practice in a location where residents have already chosen their dentist is a poor choice. You can expect some competing dental practices in most busy cities, but make sure the dentist-to-population ratio is low enough so you don’t have to struggle for new clients.

3. Practice Lease

Another important step in choosing a location for a dental practice involves the lease. Don’t just accept the first building that ‘looks’ suitable for your practice. Instead, scout around in the desired area where you want to open a practice and call up buildings/shops with a ‘for lease’ sign. Find out how much space they offer, along with the monthly lease rate. You probably don’t want to operate out of a cramped building with little room to expand.

Starting a dental practice can be a rewarding and lucrative venture that will give you the opportunity to help patients achieve a better, healthier smile. Working in your own dental practice will allow you to help people achieve more self-confidence through a better-looking smile, which is something that draws many people to this exciting and rewarding industry. The following are a few tips to take into consideration when starting your own dental practice…

1. Choose a Populated Area

I can’t stress enough the importance of choosing a well-populated area to start your new dental practice. Common sense should tell you that clients translate into sales and ultimately profits. Leasing buildings and areas in populated city areas certainly costs more than a rural location, but it’s a small price to pay for a constant stream of patients. There are several free tools around, such as Wikipedia, that allow you to gauge the population density of regions.

2. Look For Financing Options

Spend some time researching the different financing options before purchasing a dental practice. You might be surprised to learn just how much capital is required to start a dental practice from scratch. The good news, however, is that financing options are readily available.  A dental practice consultant like 1st Med Financial can help you understand all the different financing options available to you.

3. Do Not Enter a Competitive Area

Going back to the importance of choosing the right location to start your dental practice, you shouldn’t try to force your way into an already competitive area. Once you’ve found a possible location for your practice, check the local phone book or do an on-line search to see how many other dentists are around. Most clients continue to go back to the same dentist for each procedure; therefore, you won’t receive many clients if you try to muscle your way into an area with several other practices around.

4. Don’t Run a One-Man Operation

Some people may attempt to run their dental practice themselves or with a single receptionist. Although this may save you some cash on payroll, it will likely result in poor performance while increasing the chance of mistakes. The bottom line is that you shouldn’t try to run a one-man operation in your new dental practice. Instead, place help wanted ads in the newspaper to look for experienced staff members.

Whether you intend on starting your own dental practice or purchasing a preexisting one, you’ll need to come up with the appropriate capital to cover all of your expenses. It’s not uncommon for preexisting practices to sell for several hundred thousand dollars, and that’s not including its employees’ payroll. Thankfully, there are loans available to help dentists and entrepreneurs finance their dental practice. Here, we’re going to take a look at the top 5 things you should to before applying for a dental practice loan.

1. Business Plan

Before you even think about applying for a dental practice loan, you should first draft up a business plan. This will show the bank or financial lender that you are a serious business person who’s going to work hard to create a successful practice. Place yourself in the shoes of a lender and ask yourself who you would rather hire: someone with a clean business plan demonstrated on paper or someone with ideas in their head.

2. Gather Financial Documents

You’ll also want to gather any and all financial documents pertaining to the dental practice. If you’ve already invested some of your own personal assets into the practice, locate these documents to the show the lender. This will give you some credit in their eyes since you are willing to invest some of your own money. If you intend on purchasing a preexisting dental practice, request that the current owner provide three years of filed tax returns for the practice along with a copy of their year-to-date profit and loss statement. 1st Med Financial can provide a detailed checklist of all the information you will need from the current owner.

3. Check Your Credit

It’s not a bad idea to check your credit before applying for a dental practice loan. Some financial institutes will look into your personal credit, so checking it beforehand will give you the opportunity to address any discrepancies. If you see any debtors wrongfully claiming that you owe them money, don’t be afraid to give them a call to settle this issue. Allowing these unpaid debt claims to remain on your credit report will only hurt your chances of acquiring a dental practice loan.

4. Decide How Much You Can Pay

Of course, you should also decide exactly how much you are willing to pay each month on a dental practice loan. During the application procedure, the bank or financial institute will likely throw some figures out there. Biting off more than you can chew with an expensive monthly payment could place you in deep trouble, so avoid making this mistake. If you intend on purchasing a preexisting dental practice a consultant at 1st Med Financial can assist in analyzing the cash flow. This will help you see what payment amount will be practical.

5. Be Professional

When you begin the dental practice loan application process, the single biggest piece of advice I can give is to present yourself in a professional manner. Carry yourself with a professional attitude. This will go a long ways in conveying your desire to succeed as a new business owner.

Employees are the backbone of any successful dental practice. You can spend thousands of dollars on marketing and promotional material, but unless you have skilled, qualified employees, all of your hard work is for nothing. Dental practices rely on repeat customers to succeed, and ultimately it’s the staff’s responsibility to encourage customers to come back. Keep reading to learn 5 of the most common hiring mistakes in dental practices.

Mistake #1 – Waiting For The “Perfect” Applicant

One of the single most common hiring mistakes in dental practices is waiting around for the “perfect” applicant. You’ll slowly build up a list of applications and resumes as you wait for the dream candidate to come along. Unfortunately, however, there’s no such thing as a “perfect” applicant, and waiting for one will only lead to other possible applicants finding jobs elsewhere.

Mistake #2 – Hiring Employees With No Dental Experience

You should always check for previous dental experience when hiring employees for a dental practice. Even if the applicant is polite and charismatic, they should still have some form of experience in the industry; otherwise, you’ll be forced to spend additional time and energy to train them. Whether the position is for a dental assistance or office worker, make sure the applicant has at least some form of previous experience in the industry.

Mistake #3 – Not Conveying The Job Properly

Unless you want to find yourself back in the same position a couple months down the road, make sure you fully explain the job position and everything it requires to the applicants. Let them know exactly what they’ll be doing and what’s expected of them. Any applicants who aren’t willing to satisfy this criteria will likely pass on the job, making it easier on you.

Mistake #4 – Jumping The Gun

Waiting around for the perfect job candidate to come along will only harm your search for dental practice employees. On the other hand, however, hiring a candidate too early can also lead to trouble. Give your practice time to draw some potential candidate to see who is the most qualified.

Mistake #5 – Skipping The Interview

Interviews are an integral part of the job application process for dental practices. Don’t hire a candidate based solely on his or her resume. If you believe they are a qualified for the job, ask them to come in for an interview on a later date. This will allow you to ask them additional questions and get to know them in a more personal manner.

Choosing to purchase a pre-existing dental practice is a big decision that shouldn’t be taken lightly. When done correctly, you’ll have a long-lasting, profitable business that offers a valuable service to the community. On the other hand, taking the wrong approach to this venture could result in a constant financial drain on your bank account. To help you get started on the right foot, we’ve compiled a list of 5 important tips for buying a dental practice.

Tip #1 – Financial History

One of the first things you’ll want to analyze is the financial history of the practice. Ask the current owner or manager for a copy of their revenue and expenses going back at least 3 years. Depending on the size of the practice, you may or may not be able to make sense of it by yourself. If the financial information is overwhelming, a CPA or a dental practice consultant like 1st Med Financial can assist in analyzing the cash flow. Make sure to look for sudden drops in revenue along with any outstanding debts.

Tip #2 – Location

Location is a key element that you must address when purchasing a dental practice. Ideally, the practice should be located in a busy, easy-to-find area that’s near a major highway or thoroughfare. A good location will make it easy for new customers to find the practice, leading to higher sales and profits. It’s an all-too-common mistake for dentists to lease buildings located in obscure areas. You may save a couple hundred bucks a month on their lease, but you will pay for it in the long run with fewer clients.

Tip #3 – Competition

I guess you could say competition goes hand in hand with location. Before you purchase a dental practice, do some research to determine how many other practices are located in the same area. Trying to force your way into an already crowded market will make your job ten times more difficult. It’s not impossible to get a piece of the action, but it’s certainly going to require more work.

Tip #4 – Tools and Equipment

Of course, you’ll also want to check the practice’s tools before signing any official purchase agreement. Don’t just take the owner’s word for it, but instead go test the tools for yourself. Make sure they are clean and function properly. If any tools are broken, talk with the owner to see if they will fix them or reduce the sales price to cover the added expense you will incur to purchase them.

Tip #5 – Staff

Lastly, do your homework on the staff to see if they are fully trained and capable of running the practice. Dedicated, dependable employees are an invaluable tool in dental practices. While you can always hire new employees later, it’s nice to have a strong base of loyal workers to start off on the right foot.

1st Med Financial is the Home of The 100% Dental Practice Acquisition Loan”. 100% Financing programs offers competitive, fixed interest rates an can include up to 15% of the transaction amount in working capital. Dental Practice Acquisition and Commercial Real Estate combination financing is also available.