Case Study: Continuity Through Change | Transition Strategies in a Family-Owned Dental Practice

You may automatically assume that compared to larger cities, small towns and rural areas are not ripe for practice transition opportunities, simply due to the fact they have lower population density; you may even assume that smaller towns aren’t as profitable as big cities.  

But the truth behind both of those assumptions may surprise you (as you’ll read in our eBook on the subject).  

One first-hand example is below. Aprio’s Dental Team recently worked with an incoming owner whose situation challenges commonly held beliefs about practicing dentistry in small markets. 

The setting is a dental practice located in a small Arkansas town, practicing in the local community for nearly 10 years. Over that time period, the dentist had grown the practice to over $1.5 million in collections and value. In fact, the practice was doing so well that the dentist had to bring in an associate to help them manage operations and serve patients. 

Scaling a small-market practice with the addition of a new associate

When the doctor initially purchased the practice, they inherited a healthy patient list and also merged in patients from other practitioners. Our client’s practice had roughly 1,150 active patients on its roster and knew they wanted to have a long-term transition options with the practice. 

Typically, most dentists think about adding another associate once the practice has started to serve between 1,200 to 1,400 active patients.  

The practice was on a positive, upward growth trajectory and the client enlisted Aprio’s help with developing a strategy to scale through buying or attracting more patients. 

Solution: Buy-in transition planning and expansion

The original owner of the practice built out a completely new building from the ground up. Aprio stepped in, analyzed the data, and showed the incoming associate what the doctor had built, which was appealing to the new associate and gave them confidence to buy in.

Due to the fact the practice was a family business, the doctor’s motivation was to encourage the associate to buy in for a lower price. The doctor saw the value of having a good transition option for their long-term goals and wanted to make sure the practice was a strong investment for the incoming associate on a personal level. After seeing the data and understanding how productive and profitable the practice was, the associate made the final decision to buy into the practice and ultimately take the reins from the retiring doctor. 

Aprio helped both the existing owner and the new associate navigate the transition process for their mutual benefit and proposed strategies to position the practice for continued growth. Aprio’s dental transitions specialists helped both doctors assess and choose the right dental-specific financing for a better transition experience.  

Outcome: A successful transition and a promising future for the new owner

Our dental practice transitions team created a transition strategy that fit the doctor’s and associate’s practice goals. Once the associate dentist had been running the practice for three years, they hired another dentist to help manage the practice’s growing case load. Because the existing practice was already successful in its smaller market, the associate dentist was able to further expand their team and make use of the new building on the property. 

What’s next?

When it comes to purchasing or establishing a dental practice, your first instinct may be to set up shop in the suburbs or the city, where there is greater population density. But that isn’t always the case. 

Whether you are ready to sell, buy, start a practice or simply start the conversation, Aprio’s Dental Transitions team can provide you with the industry-specific professional knowledge and comprehensive services you might need to succeed. We are here to simplify the transition process and help you achieve optimal outcomes that can position your dental practice for continued success. At Aprio, we serve as a single-source financial partner for dental practices of all sizes, extending beyond the transition itself.