Looking for a practice

[drseplo]

I've been looking for well over a year now in the North Dallas area for a practice to buy and during that time I've found very little that's been attractive and anything that's been remotely interesting has been purchased by a DSO. I'm getting frustrated and wanted to see if anyone has any recommendations for where to look or experienced the same. I've been checking in on several brokerage sites.

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[Thehighwind87]

It takes a long time to find a practice. I suggest having an outline of 50 or so miles that you think is "doable" and waiting for the right opportunity. This is a life changing decision- do not rush into something that you don't feel comfortable with.

 

[SnozzBerry]

It takes a long time to find a practice. I suggest having an outline of 50 or so miles that you think is "doable" and waiting for the right opportunity. This is a life changing decision- do not rush into something that you don't feel comfortable with.

Nah, don’t “wait for the right opportunity”. That may take forever, you gotta make the right opportunity happen. OP how are you looking for practices?

 

[drseplo]

Nah, don’t “wait for the right opportunity”. That may take forever, you gotta make the right opportunity happen. OP how are you looking for practices?

I've been looking through brokerage sites. Dentaltown classifieds, Practice transitions group, DDSmatch, and ADS Texas.

 

[Thehighwind87]

I've been looking through brokerage sites. Dentaltown classifieds, Practice transitions group, DDSmatch, and ADS Texas.

Sounds about right. I did the same while networking with reps and accountants.

Talk to your rep tell them you are interested in buying and talk to your acct to know if any doc thinking of retiring.

However the reality is the ones that are selling are the ones selling on classifieds, and brokers. The issue with networking with reps and Accts is that they may know of someone that might retire soon- but for a dentist to “finalize” their retirement might be a while so you will be strung around for a while before they say ok I’m done. To finalize and sell a practice a dentist has to be mentally be done and ready to quit which doesn’t happen overnight. So you might strung along for a year or two or more aka waste of time.

That’s why brokerages is better because those sellers are selling not “thinking” of selling


Regardless what I did was put 50 miles on my radius and practices that fit my criteria. 700-1mil bread and butter, 50-60% overhead, etc. didn’t bother with practices not in my criteria. Once the right one came I already had the bank setup and knew it was the one and pulled the trigger.

So long story made short sometimes you just gotta wait but be ready and know what you want- and when it’s the right opportunity jump on it.

 

[SnozzBerry]

Sounds about right. I did the same while networking with reps and accountants.

Talk to your rep tell them you are interested in buying and talk to your acct to know if any doc thinking of retiring.

However the reality is the ones that are selling are the ones selling on classifieds, and brokers. The issue with networking with reps and Accts is that they may know of someone that might retire soon- but for a dentist to “finalize” their retirement might be a while so you will be strung around for a while before they say ok I’m done. To finalize and sell a practice a dentist has to be mentally be done and ready to quit which doesn’t happen overnight. So you might strung along for a year or two or more aka waste of time.

That’s why brokerages is better because those sellers are selling not “thinking” of selling


Regardless what I did was put 50 miles on my radius and practices that fit my criteria. 700-1mil bread and butter, 50-60% overhead, etc. didn’t bother with practices not in my criteria. Once the right one came I already had the bank setup and knew it was the one and pulled the trigger.

So long story made short sometimes you just gotta wait but be ready and know what you want- and when it’s the right opportunity jump on it.

How long ago did you buy? Your recommendation seems a bit outdated… That criteria pretty much perfectly matches exactly with what DSO’s are looking for, and they are willing to pay more.

OP—In a high-demand area (I bet anywhere near Dallas is), DSO competition for practices is your biggest challenge. You probably can’t out pay them. So you have two choices:

1. Go for practices they aren’t interested in, ie usually smaller practices. The goal here would be to find a practice that is underperforming. Old dentist that under treats, decent/good location, doesn’t advertise, is booked out, and doesn’t work much, etc. A good accountant will help discern the potential of the practice. Once you get into a practice like this, it will take extra work. However, it can be most profitable since you will pay less. Again, less predictable, which is why DSO’s stay away.

2. Find the dentist who doesn’t want to sell to a DSO. These exist. Single dentist exiting a partnership or group would probably qualify here too. You need to send hand written letters to every office that is owned by an older dentist in your acceptable radius, maybe even stop in for a handshake and convo. Cast a big net here.

You need to continue doing what you are doing as well of course. But as you already know, the DSOs know what to look for and will snatch it from you if given the chance. Brokers like fast and easy sales. Network, network, network. Specialists, accountants, study clubs, supply reps, etc.

Best of luck!

 

[Lemillion]

A fair amount of my classmates practice in the Dallas area. Many of them spent a good amount of time searching for a practice to be sold in the area with no luck.

Any thoughts on opening up your own? I have a few classmates that opened outside the Dallas area (Mesquite, Rowlett, Aubrey, etc) and one of them is already planning his second location. Sometimes you will have to create your own opportunity if one does not present itself. At least then you can pick the location, design the office with your vision and establish your culture from day one. Just another consideration!

 

[Thehighwind87]

A fair amount of my classmates practice in the Dallas area. Many of them spent a good amount of time searching for a practice to be sold in the area with no luck.

Any thoughts on opening up your own? I have a few classmates that opened outside the Dallas area (Mesquite, Rowlett, Aubrey, etc) and one of them is already planning his second location. Sometimes you will have to create your own opportunity if one does not present itself. At least then you can pick the location, design the office with your vision and establish your culture from day one. Just another consideration!

Yeah its hard. I almost did that until the right one came along. OP you can go knock on doors if you want. I did that to, but it seemed sorta futile and silly. I looked up all the older dentists in the area and went knocking on doors. But like I said, it's sorta futile and it reeks of desperation. In addtion, the process to sell (put value on the practice) and mentally (dentist retiring) will take time. It's not an overnight decision.

Networking with reps, accts etc helps to, but like I said, the ones that are looking to sell- are listing it. The ones thinking of selling- might not sell for a while. At the end of the day tho, DSO is part of the competition- and they can offer more money. It's just the way the profession is heading. And at the end of the day, the dentist will always sell to the highest bidder. So sometimes you just gotta pay more for what it is. Noone is gonna sell their house to the "nicer" guy- but rather they would sell it to the highest bidder. Duh.

Start-ups in a "cheaper" place can work. I would def not do start up in bay area. Texas can work, if it still reasonably priced

 

[drseplo]

When you guys say network with reps, how would you go about doing that? Are you just calling schein, patterson etc and asking to speak to your local guy?

 

[Thehighwind87]

When you guys say network with reps, how would you go about doing that? Are you just calling schein, patterson etc and asking to speak to your local guy?

Pretty much and or talking to owners/specialists that use reps. It's a long shot though. Reps may know of "someone" that is old and thinking of retiring and or smaller practices- but the reality is- those sellers take time to sell. It's like selling a house. You don't just move tomorrow. With a practice it's arguably harder- since its a source of income and your lifes work for the past 30 years.

In addition- lets say you do find someone that wants to sell- how do you value how much the practice is worth...and how does the buyer? In addition, if you do entice someone to sell- what stops them from saying hmm ok- you are willing to pay 400k for my practice, let me go ask around accountant and the brokers what my practice is worth- and they say hey dude a dso will pay 500k if you list it with me- guess what happens? The practice owner goes and lists it with a broker and gets more money and you get left in the dust. Business is business and money talks.

Anyways- I knocked on doors, talked to reps, talked to accts, met with study clubs etc. At the end of the day, I ended buying from a broker.

 

[OncePreDent]

I've been looking for well over a year now in the North Dallas area for a practice to buy and during that time I've found very little that's been attractive and anything that's been remotely interesting has been purchased by a DSO. I'm getting frustrated and wanted to see if anyone has any recommendations for where to look or experienced the same. I've been checking in on several brokerage sites.

Have you thought about building a practice from scratch? There are a lot of perks going both ways (purchasing or starting one up), but it might be something that you should start looking into.

 

[Roto Picante]

One word..... Dallas.

 

[drseplo]

One word..... Dallas.

Not in dallas proper to be honest, I'm looking about 1 hr from downtown dallas.

 

[SnozzBerry]

When you guys say network with reps, how would you go about doing that? Are you just calling schein, patterson etc and asking to speak to your local guy?

Yeah pretty much. Does the office you work at now have any existing relationships?

 

[SnozzBerry]

Yeah its hard. I almost did that until the right one came along. OP you can go knock on doors if you want. I did that to, but it seemed sorta futile and silly. I looked up all the older dentists in the area and went knocking on doors. But like I said, it's sorta futile and it reeks of desperation. In addtion, the process to sell (put value on the practice) and mentally (dentist retiring) will take time. It's not an overnight decision.

Networking with reps, accts etc helps to, but like I said, the ones that are looking to sell- are listing it. The ones thinking of selling- might not sell for a while. At the end of the day tho, DSO is part of the competition- and they can offer more money. It's just the way the profession is heading. And at the end of the day, the dentist will always sell to the highest bidder. So sometimes you just gotta pay more for what it is. Noone is gonna sell their house to the "nicer" guy- but rather they would sell it to the highest bidder. Duh.

Start-ups in a "cheaper" place can work. I would def not do start up in bay area. Texas can work, if it still reasonably priced

Pretty much and or talking to owners/specialists that use reps. It's a long shot though. Reps may know of "someone" that is old and thinking of retiring and or smaller practices- but the reality is- those sellers take time to sell. It's like selling a house. You don't just move tomorrow. With a practice it's arguably harder- since its a source of income and your lifes work for the past 30 years.

In addition- lets say you do find someone that wants to sell- how do you value how much the practice is worth...and how does the buyer? In addition, if you do entice someone to sell- what stops them from saying hmm ok- you are willing to pay 400k for my practice, let me go ask around accountant and the brokers what my practice is worth- and they say hey dude a dso will pay 500k if you list it with me- guess what happens? The practice owner goes and lists it with a broker and gets more money and you get left in the dust. Business is business and money talks.

Anyways- I knocked on doors, talked to reps, talked to accts, met with study clubs etc. At the end of the day, I ended buying from a broker.

Yeah bro, since it didn’t work for you it won’t work for anyone. You have a tendency to use your solo experience and let that paint a broad brush of others’ experiences. It’s silly.

OP is already doing the broker thing and has been for over a year with no success. He might as well try additional avenues to accomplish his goal. The practice next door to mine was bought by a dentist who sent a letter to the owner dentist. It can happen, it’s not 1 in a million.

This is a big deal, gotta cast the biggest net you can.

 

[Thehighwind87]

Not in dallas proper to be honest, I'm looking about 1 hr from downtown dallas.

Dallas is growing a lot. Don’t worry the right opportunity will come your way! Cast your net out and see what you get whether it’s knocking on the doors, networking, sending out flyers etc. Nothing to lose.
Best of luck!

 

[Lemillion]

Noone is gonna sell their house to the "nicer" guy- but rather they would sell it to the highest bidder. Duh.

Good analogy here. I've had a few friends that were strung along by a "retiring" dentist and then at the last minute got the rug pulled from underneath them. Usually one of two reasons: 1) dentist not really ready to retire 2) DSO offered a huge deal that we can't compete with

 

[Thehighwind87]

Good analogy here. I've had a few friends that were strung along by a "retiring" dentist and then at the last minute got the rug pulled from underneath them. Usually one of two reasons: 1) dentist not really ready to retire 2) DSO offered a huge deal that we can't compete with

Yup seen it happen to. Also have seen- associateship offered with path to buy-in/take over the practice. And after working 1-2 years, the older doc says nah I'm not ready to retire, and or they are ready and realize they can make a better deal with broker/dso and sell to another. It happens. At least with a broker, everything is clear cut buy sell done. Regardless there are def alternative ways to find a practice- but it's not that easy and or straightforward (knocking on doors, flyers, cold calling) etc.

 

[Lemillion]

Yup seen it happen to. Also have seen- associateship offered with path to buy-in/take over the practice. And after working 1-2 years, the older doc says nah I'm not ready to retire, and or they are ready and realize they can make a better deal with broker/dso and sell to another. It happens. At least with a broker, everything is clear cut buy sell done. Regardless there are def alternative ways to find a practice- but it's not that easy and or straightforward (knocking on doors, flyers, cold calling) etc.

Very true. Some of this is a combination of effort and definitely luck. My friend recently took over a pedo office after being there for a few years. Great practice. He got the associate position because he was helping a friend draft his team for fantasy football and a rep was playing in the group and connected him with the owner. He still can't believe his luck in how things turned out in his favor.

 

[Thehighwind87]

Very true. Some of this is a combination of effort and definitely luck. My friend recently took over a pedo office after being there for a few years. Great practice. He got the associate position because he was helping a friend draft his team for fantasy football and a rep was playing in the group and connected him with the owner. He still can't believe his luck in how things turned out in his favor.

I just looked up one of the older docs that invited me way back when to associate->own….

It was 5 years after me before they sold.

If it works out great- but at the same time it can be a complete waste of time. That’s why there is some benefit to brokers as this one’s listed are 100% committed to selling start to finish in 1-3 months.