North Texas Dentistry Volume 9 Issue 5 2019 ISSUE 5 DE | Page 34

practice transitions
MERGERNOMICS
Fast money the easy way
by Richard V. Lyschik, DDS, FAGD, CFE
The continued growth and success of a solo prac-
tice is becoming more difficult every day. With
increased competition, capitation programs,
DSOs, heavily advertising retail centers, and
the “New Patient FREE Exam and X-rays”
(and similar gimmicks) we have seen, a
practitioner must be prepared to con-
sider ways to expanding the traditional
patient base. Unfortunately, many of my den-
tal colleagues make the mistake of joining more and
more discount programs to add patients to their practice, only
to discover how quickly these same new patients jump ship when some-
one else offers even lower priced dentistry! Doctor, there is a better way!
A practice merger is the best investment a doctor could ever
hope to make in his/her lifetime!
n
n
n
n
n
n
plies, and commissions paid to the associate. Clearly, a merger
maximizes income, and minimizes risk!
Patient retention averages 95% With an ideal merger considerable income is generated without
any additional clinical production necessary by the purchaser.
You are assured a stronger position in your marketplace A practice merger is the best investment
a doctor could ever hope to make!
Additional production income is derived from the
associate (either the seller or a new associate) A typical practice grossing $500,000, added to an existing prac-
tice that adds an associate, an assistant and another hygienist
to accommodate the merged practice production into the new
practice, shows a gross profit of 43% passive income to the prac-
tice owner! If the purchaser chooses to produce all of the
acquired production, then the profit soars to an annual return
of 188% on your investment!
Practice stability increases due to the larger
practice size and the increase in referrals
You increase the utilization of your facility
Eliminates “solo economic dependency” so you get to be
out of the office more!
With a practice merger you will not incur any additional costs
to your fixed expenses, such as rent, utilities, and telephone.
You will get more work out of your current staff, and will per-
haps have to add only one or two additional staff members. The
seller’s staff is the first place to look for qualified employees,
and most often the seller’s hygienist continues at the new office.
Any other expenses will be related to production: lab fees, sup-
34 NORTH TEXAS DENTISTRY | www.northtexasdentistry.com
Paying for the new practice acquisition can be with a conven-
tional loan, or with a production acquisition agreement with the
seller, whereby there is a down payment and payments are
made as the patients come in; yet another way to reduce risk for