Should Money Be the Most Important Factor when Buying a Dental Practice?

Buying a Dental Practice: Should Money Be the Most Important Factor?

When you are in the market to buy a dental practice, how do you ultimately decide which practice to purchase, and what factors determine that decision?

Many purchasers who are in the process of selecting and buying a dental practice indicate that money is not the most important issue. The question of how much money can be made in one practice versus another one is often a secondary consideration. Purchasers tend to focus on the age of the equipment and the color of the office wallpaper, but this can be a disastrous mistake. Money should always be a major factor when selecting a practice opportunity.

Consider how many years you plan on practicing dentistry—twenty years, thirty years, or more? Most never consider that question. In fact, many dentists practice for less time than they project due to disability or illness.

Although money might not be a major factor at the time you are buying a dental practice, what happens if you cannot continue to practice and lose your income? How will you and your family continue your lifestyle? How do you plan for debilitating contingencies? Disability insurance can certainly help, but many dentists have found that disability insurance by itself is not enough to maintain their lifestyle. Since you cannot predict how many years you will be able to earn a living practicing dentistry, the ability to make money while you can is very important.

Dentistry is hard work. You went through many years of school to make a good living and to provide financial security for you and your family. Money is not important unless you are already rich. In that case, you can afford to disregard the business of dentistry and just do it as a hobby. For most dentists, though, that is just not reality.

Financial security will not be achieved without considering the financial consequences of your decisions. When planning on buying a dental practice, the opportunity should be viewed for its earning potential. The more money you earn now, the more likely you are to ultimately achieve financial security and maintain your present standard of living upon retirement.

If you are one of those doctors who will depend upon your dental practice to provide a living and a comfortable retirement, you should evaluate all practice opportunities from their present and future income potential, not from a cost perspective. Practice equipment can always be replaced and changed, esthetics and decorations are modifiable, but practice income usually does not change immediately. Practice opportunity should be definable as the ability to derive a true net income from the dental practice you are going to acquire.


Henry Schein Professional Practice Transitions, Inc. is a national leader in dental practice transitions. A subsidiary of Henry Schein, Inc. they provide expert guidance for selling and buying dental practices, dental practice fees and management, assessing partnership and associate-ship opportunities, and performing dental practice appraisals and valuations.