I really enjoy a good David vs. Goliath story, especially these days. We love to tell stories about how the underdog overcame the insurmountable odds to become successful. Rooting for the little guy always resonates with our entrepreneurial ideas and values. Yet in business, this narrative is only partly true. Goliath can win too, and in today’s dental market he usually does.
Goliath in this article represents the corporate machine in dentistry that is consuming solo and group practices at an alarming rate and defeating the “non-corporate” holdouts with monies that are too good to be true. When I say monies that are too good to be true, I am talking about offering 20-30% more for a practice, maybe even 50% more than a solo dentist or partnership can offer. Solo dentists have to qualify with a lending institution, and can only borrow up to a maximum amount, yet the corporate chains and regional groups are the bank. They have their own money and they can out spend or out bid any new graduate, experienced associate, or multi-dentist partnership they want. This is the new reality of dentistry; the new normal.
Now that I have your attention and have painted an uphill picture for an associate or entrepreneurial dentist looking to purchase in a big city or competitive market, let me offer some tips on how to fight the battle against the Goliaths:
- The dental market is a “who you know” business. I cannot stress this point enough. Talk to as many people in the network as possible. Many successful sellers are planning their transition 1, 2, or maybe even 3 years ahead. It is usually their trusted advisers who know of their succession plans. Great practices are never listed for sale in the dental journals or online like a used car. You will only hear about their sale after the fact.
- If you want to be prepared for any opportunity that may come your way in the big city, develop your skills with comprehensive procedures thoroughly prior to purchase. Procedures such as Endo, surgery, implants, sedation and even Ortho are great practice builders. If you have developed efficient skills with these procedures then you can fill the shoes of the previous dentist and even add value and possible growth to the practice. If you are still new in your clinical maturity then you may miss out on a great practice if your resume does not support your opportunity.
- You want to know the key to winning the battle financially against the corporate Goliath? You find the small towns where the large companies do not exist and seize the opportunity to grow and establish a reputation that discourages others from entering the market. Being small in size now becomes your advantage. You must think outside the box in today’s dental landscape.
Take a look at the David vs. Goliath story again. The lesson is not simply about when a powerful competitor takes on a smaller one. A smart underdog understands that the real keys to win the battle are sometimes obscured by industry misconceptions of size and strength. Most of your colleagues want to live in the big city and compete for the same patients against every new giant entering the market. A smart dentist recognizes that success is based on relationships and old-fashioned chair side manner, and a small community that supports their dentist is today’s new goldmine. If you’re a small business owner, or hope to be, perceiving the competition correctly can lead to a Goliath sized advantage.