Once you have a signed Letter of Intent, it’s time to take a closer look at your potential new practice. Due diligence is one of the most important aspects of preparing for a successful dental practice acquisition.
There are several important indicators that offer insight into practice performance. In this blog post, we will look at how to assess a practice’s schedule. As part of reviewing the schedule, you should take a look at both the appointment book and the recall system.
Look at how the day is scheduled.
Picture yourself in the doctor’s shoes. Would you be comfortable doing that dentistry? If they place a crown every 15 minutes, do think you could keep up? Can you envision yourself working their schedule? While schedules are flexible, this you may want to think twice if the selling doctor is significantly more efficient than you feel comfortable with.
Reviewing the Schedule: What Many Doctor’s Miss
It might be tempting to just glance forward in the schedule and check to see that appointments are scheduled out and the days look relatively full. If you only look forward, however, you’re doing yourself a serious disservice!
If you want to find the truth, look to the past. If you only look forward, you may see an ideal schedule. It’s likely that the schedule will be full. But looking backward gives you the real picture. Does the practice have a problem with cancellation? Would you be happy performing the dentistry that the doctor actually performed, and not just the dentistry that is on the schedule going forward?
Looking at what has actually happened is as important as looking forward to ensure that appointments are being scheduled and re-care is on track.
Assessing Hygiene Appointments
There is a fairly simple formula for analyzing a hygiene schedule.
First, count how many hygiene days there were in the last 30 days. Next, count how many hygiene openings there were in that same time period. (If there are 2 days of hygiene or less per week, you may want to increase the sample size.) Then you simply divide the number of openings by the number of days.
For example, if I count back and find 40 hygiene days and, in that same time period, count 40 hygiene openings, then that practice has one opening per day. In looking at practices, I’ve found that there are usually about 0.8 hygiene openings per day (32 openings over 40 hygiene days).
If you look back and there is more than one opening per day, this indicates one of two things: either there are too many hygiene days scheduled or, more likely, the office does not keep with up with their recall system (or has a poor system to begin with). It could also mean that they don’t have a system in place to handle cancellations or they have a weak perio program.
All of these problems indicate opportunity – and having 1 opening per day is usually ok. Even the best run practices have about .5 openings per hygiene day. We’ve seen some practices with as many as 3 openings per day! Remember, if you look forward you probably won’t see any openings – so be sure to count backward.
Using these tricks can help you feel confident about your practice acquisition. If you’re considering purchasing a practice in the next 5 years, please fill out our Inside Buyer Survey and be the first to hear about new listings that meet your specific criteria.