MediCruit - Maximising profits and selling at the right time

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Maximising profits and selling at the right time

It is hard for busy principal dentists and practice owners to find the time to step back and look at the bigger picture. An evening seminar held in London in April provided a fantastic opportunity for many to do just that and to listen to some expert advice in three key areas of business management and planning.

Practice profits and preparing to sell was organised and hosted by Mediestates, a Henry Schein company. The evening started off with drinks and canapés as everyone gathered together. The main business of the evening began with three short, informative talks from industry experts who challenged attendees to double their practice profits, make sure they are in a good position to sell their practice when the time comes, and maximise retirement income.

A key theme of the evening was it is never too early to boost the profits of your business and ensure it is ready when the time does come to sell.

How to double your profit
Kicking off the seminar section of the evening was Andy McDougall, who heads up the team at Spot On Business Planning. He gave a thought-provoking talk entitled ‘How to double your profit and your practice valuation.’

Andy suggested maximising profit has nothing to do with luck, and ‘everything to do with knowhow’. Practice owners should put together a three-year strategic plan to transform the profitability of a business. Business performance should be reviewed monthly and appropriate action taken to tackle weaker areas. By being proactive in this way and using an efficient structure, it is possible to double net profit every three years.

He went on to reveal some of the tools and techniques Spot On uses for achieving this and talked about the importance of calculating the net profit of each treatment.

Andy put a question to his audience, ‘five frogs are sitting on a log and four decide to jump off – how many are left? Well it’s five, because saying it and doing it are two different things.’ Putting jokes aside for a moment, he said, the five most dangerous words a practice owner can say are ‘maybe it will go away’. To remain profitable, it is essential to tackle problems head-on when they arise, and when you have made a decision on what to do, act on it straightaway.

Preparing to sell
The evening’s second speaker, practice valuation manager for Mediestates Alison Bates, gave a fascinating insight into ‘Preparing to sell; the journey and what to expect as a vendor.’

She started by detailing how the market for dental practice sales had changed over the last 15 years. The demand from dental buyers has increased over that period due to two forces that have transformed the market; changes in the NHS contract and the corporatisation of the market. For practice owners, the important consideration is where the journey will go next and what factors are likely to influence the market over the coming months.

Alison stated that practice values are at their highest level ever, and this trend is expected to continue for the remainder of 2019, with growing demand, particularly for private practices. ‘What is going to change?,’ she asked. ‘Brexit is already having an impact on recruitment of associates in more rural and coastal areas and a lot of corporates are struggling with recruitment as well.’

Alison stated the NHS contract reform will take a number of years to roll out across the country and ‘this will be the biggest thing to impact dental values across the sector’. She ended by highlighting the value of having an expert on hand, such as Mediestates, to guide practice owners through the lengthy and complex ‘minefield’ of the sales process.

Boost your retirement income
The final speaker of the evening, Tim Collyer, of Independent Financial Planners Montgomery Charles Wealth Management, tackled the subject of ‘Top strategies to maximise your retirement income.’

He told attendees that everything they do must be evidence-based, but the actual destination should be ‘dream-led’. In other words, dentists should work out what they want from their retirement and then make sure their business decisions can facilitate that.

A key theme of Tim’s presentation was recognising the best time to sell a practice. He advised delegates that the most important thing was to ‘invest in yourself’ by enlisting the help of experienced financial experts who can give you advice. This means ‘you can do what you do best, which is running the business’, while the financial professionals ‘do what they do best, which is looking after your money’.

Following all that food for thought, attendees were treated to a delicious three-course meal and an opportunity to mull over the advice with fellow colleagues. The evening was hailed a great success, and attendees left full of inspiration and new ideas to put into their own practices the following day. Mediestates regularly holds similar events on a variety of topics, including preparing for retirement and buying and selling a dental practice.

Posted by: MediEstates on
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