GAP Australasian-Dentist-Mar Apr 2019

Category 108 AustrAlAsiAn Dentist W hen it comes to preparing one’s dental practice for sale, especially to a dental corporate, rob Harwood enjoys a unique perspective. He sits on both sides of the fence: As potential seller of a dental practice on one hand and associated with a corporate acquisition firm on the other. straddling the two seemingly conflicting positions, rob says, grants a clearer perspective of how one ought to plan for an exit strategy. in addition to being the principal owner of a Bayside practice in Melbourne, rob is also an experienced dental prosthetist. in his 30-odd years plying the dental trade, rob has witnessed first-hand epochal shifts in the marketplace, not least the gradual but significant passing of baton from private to corporate hands. More importantly, he says, are the valuable lessons learned from personally having built and sold his first practice in 2008 after speaking to over 100 dental practice owners, including those of corporate and non-corporate ilk. “i’ve been fortunate to have gained a lot of valuable insights into the inner workings as well as external factors that make a dental practice thrive or perform poorly in our fast-moving business environment.” “Both as practice owner and dental prosthetist, i’ve learned enough lessons from my own mistakes, and those of others, to realize that running a successful dental surgery demands a fresh outlook.” rob believes several factors define a modern practice, including a transparent fee structure and digital dentistry. “the use of intraoral digital scanners in the practice affords dentists the ability to scan and mill restorations while patients wait in the chair. that is revolutionizing dentistry while giving patients unprecedented comfort, convenience and time-savings.” rob justifies the initial cost outlay for incorporating digital dentistry claiming he was able to pay off his 3shape scanner in only seven weeks. there are also intangible – but no less direct – benefits: “Digital dentistry is a great practice- building tool that enhances your dentist- patient communication and patient referrals.” in terms of attracting newpatients, rob believes practices that offer smilestyler Clear Aligners, smile Fast, Quick straight teeth and other orthodontic solutions, enjoy a distinct advantage. “such services attract a younger demographic especially adolescent patients. i have found that the rest of the family tends to visit the same general dental clinic where the child receives orthodontic treatment, for their own restorative or preventive services. it is simply more convenient to do so since the child requiring braces needs to attend multiple orthodontic sessions.” Another pragmatic observation, rob notes, is the undeniable ascent of dental corporates. “the corporates have forever changed the mindset of how dentistry is performed and viewed by patients, and there is really no other way to see it if you are a practice owner today.” “the corporates are very aggressive in how they attract new patients, using unique models that weren’t used in the past. they have the buying power to reduce ongoing operational costs and a robust system to manage all Hr and administrative operations (which is a big headache for most practice owners).” “Whether you like them or not, private owners need to be smarter and aware of what corporates are doing and use the situation to their advantage.” For those who see their dental practice as a retirement fund, priming your investment in conjunction with a well-planned exit strategy is crucial – an area rob has paid careful attention to, following mistakes committed in the past. One hard lesson he has picked up was derived after selling his Mornington Peninsula practice to a private buyer in 2008. “that practice was on a growth curve of around 25 per cent and i made a profit of around $300,000. that turned out to be an underwhelming experience because had i planned a five-year exit strategy instead of a 6 months walk-in-walk-out, the size of my profits should have been 2-3 times more than what i achieved.” rob blames the regrettable decision on having swallowed the “Accountant’s Perspective” of what constitutes a good selling strategy instead of one that takes into account the unique conditions of a dental sale. “selling a dental surgery is different in that the original team members that helped to make the practice attractive to buyers can stay on for an extended period to make the final settlement price even more attractive. However, it takes a lot of planning and having the foresight to start working out your exit strategy now.” that is exactly the long-term exit strategy rob has put in place for his current practice, with plans to enter into negotiations with ekera Dental in due course. Although he’s a clinical services Keep up with the times Corporates have forever changed the dental game, and it’s up to you to make the most of the situation, says Rob Harwood, a practice owner with a hand on the corporate lever. By Danny Chan aQuIsItIons Rob Harwood