A lot of people in the dental industry are planning a slow down for dental services this year and in 2021.
This is not a good news for most dentists who want to build a practice from scratch in the next couple of years:
A. The covid19 employment factor: A large number of dentists are currently unemployed and will continue to be unemployed if their employers can’t keep them busy in the coming months, specially for elective cases. A vaccine will eventually help bring this prolonged uncertainty to an end, but the earliest vaccine is scheduled to come online in mid-2021.
B. The credit tightening factor: Lenders have already restricted “new practice” loans to dentists with high student loans, and the current economic climate is making banks be even more cautious about lending in general (mortgages, credit cards, etc), including dentists. If anything, the bar for a practice loan will be higher for a while.
C. The employer sponsored dental insurance market is expected to contract due to companies re-assessing benefits to their employees, and/or many employees choosing to forego dental insurance during a recessionary economy. This will effect the # of new patients in saturated markets and it will be very difficult to open a new practice.
What will be the case to open a new practice in the next couple of years or so?
The risk to open a new practice is at an all time high, both for dentists and lenders.
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This is not a good news for most dentists who want to build a practice from scratch in the next couple of years:
A. The covid19 employment factor: A large number of dentists are currently unemployed and will continue to be unemployed if their employers can’t keep them busy in the coming months, specially for elective cases. A vaccine will eventually help bring this prolonged uncertainty to an end, but the earliest vaccine is scheduled to come online in mid-2021.
B. The credit tightening factor: Lenders have already restricted “new practice” loans to dentists with high student loans, and the current economic climate is making banks be even more cautious about lending in general (mortgages, credit cards, etc), including dentists. If anything, the bar for a practice loan will be higher for a while.
C. The employer sponsored dental insurance market is expected to contract due to companies re-assessing benefits to their employees, and/or many employees choosing to forego dental insurance during a recessionary economy. This will effect the # of new patients in saturated markets and it will be very difficult to open a new practice.
What will be the case to open a new practice in the next couple of years or so?
The risk to open a new practice is at an all time high, both for dentists and lenders.
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