Ultimately whether surrendering your NHS contract will increase the value of your dental practice will depend on numerous factors unique to your practice.

NHS goodwill Vs private goodwill

NHS goodwill has traditionally held a much higher value than private goodwill, in some cases twice the value. The consistent monthly payment from the NHS provided a security that not many other industries enjoy. This made dental practices a very desirable purchase option for independent dentists and corporates alike.

Post-pandemic, the world changed in many ways and dentistry has certainly experienced its fair share of change. Whilst practices were still receiving regular NHS payments without having to deliver full contract targets, chair time was increasingly being utilised for private treatments, with a clear focus on cosmetic dentistry boosted by a higher level of disposable income.

Subsequently we now find ourselves in a situation where associates are more inclined to deliver private dentistry. UDA remuneration rates have been driven up (making NHS dentistry less profitable) and many practices face large clawbacks. Hence why you may be considering surrendering your NHS contract.

Practice valuations are driven by profitability metrics. If you hand back your NHS contract you need to have a plan in place to quickly replace that profit.

4 important factors to consider before surrendering your NHS contract:

1. Your current UDA rate

If you have a £28 UDA rate your NHS contract will deliver less profit than a practice with a £35 per UDA rate and so you may find it easier to replace that profit through conversion of NHS patients to a dental plan or through fee-per-item treatments.

2. Remuneration rate paid to Associates

If you have a £35 UDA rate, paying your Associate £12 per UDA of that income is costing you 35% to deliver. If you convert to private, chances are you will be remunerating your Associates at 45-50% meaning you will have to deliver a higher level of turnover just to match the same profit level due to the clinical costs being higher.

3. Private dentistry costs

Private practices generally entail higher costs in terms of laboratory and material spend, meaning that a like-for-like replacement of NHS turnover to private turnover might not always provide a like-for-like profitability.

4. The look and feel of your practice

Many private practices are embracing high end fit outs, with bespoke branding and an enhanced patient journey. You would need to think about how your practice would compare to other practices in the locality to ensure that you retain your patients once you convert them to private patients.

In summary…

Clearly there is no one-size fits all, however we are seeing many owners successfully surrender their NHS contracts while still protecting the value of their practice.

It may be that a gradual reduction of the contract value is the most sensible option, taking away some of the stress of NHS delivery while still maintaining a smaller stable income into the practice. Mixed practices still prove most popular for sale – buyers still value NHS contracts and the security they bring as long as they are considered to be sustainable.

What’s next?

Ultimately the decision on the future of your contract shouldn’t be taken lightly. Seeking advice from an experienced broker is the best course of action, as they can weigh up the nuances of your practice and hypothetically model what would happen to your practice value with a rebased or surrendered contract.

To speak to one of our experts, contact us or book a valuation to chat through your options.

The post Should I surrender my NHS contract? appeared first on Henry Schein Dental Practice Sales.

Here are three key things to consider in the process…

1. The timing

Timing your exit from the dental practice is crucial.

Timing is critical in any sale, especially in the dental industry. Understanding the right time to sell can greatly impact the valuation of your dental practice and terms of the deal. A well-timed exit allows for better alignment with market conditions, which can result in a smoother transaction and better offers. It’s essential to keep an eye on industry trends and the financial performance of your practice to determine when it might be the best time to initiate the sale process.

2. The preparation

Preparing for a sale goes beyond just putting the practice on the market.

Proper preparation involves:

• Ensuring all financial records are in order
• Making any necessary updates to the practice, and
• Preparing your team for a potential transition.

This can help maximise the value of your practice and minimise disruptions during the sale. A thorough valuation will help establish a realistic price and set expectations for potential buyers.

3. Having the right advisers by your side throughout the process

Selling a dental practice is a complex process that requires specialised knowledge and experience.

Dental brokers help you navigate the sales process as easily as possible. The right advisers can guide you through each step, from valuation to finding the right buyer and negotiating favourable terms.

With our expertise as part of the Henry Schein group, we bring a global perspective and access to insights that can significantly benefit our clients. We are here to support practice owners throughout the entire process, making sure each aspect of the sale is handled professionally.

Find out more…

Read more about the dental practice sales process and how we can help plan your exit strategy and connect you with the right acquiring party; the buyer.

To book a no-obligation valuation of your dental practice, book online here or contact us today

The post Selling your Dental Practice – 3 Key Things to Consider… appeared first on Henry Schein Dental Practice Sales.

So, you’ve decided to purchase a dental practice? Congratulations! This is an exciting venture that can be very rewarding. However, it’s important to remember that buying a dental practice is not like buying any other business – there are unique considerations that must be taken into account.

Your business plan is the document that will outline your goals for the practice, how you intend to achieve those goals, and what financial investment will be required. It should also include a market analysis to ensure there is a demand for the services you intend to provide.

Creating a business plan can seem like a daunting task, but it doesn’t have to be!

In this blog post, we will discuss how to write a business plan when buying a dental practice, and the key areas you need to consider such as finance and investment. Let’s get started!

1. Start with an executive summary

This is a brief overview of your business plan that should include a snapshot of all the essential information that lenders require before deciding on whether or not to lend to you. As an introduction to your business plan this pivotal document needs to outline what services you will be providing, what funding is required, and a plan for repaying the loan. It’s important to remember that this summary should be persuasive and convince the reader that your dental practice is a good investment.

2. Create the core section of your business plan

This section will include more detailed information about the dental practice you are intending to purchase, such as the location, size, number of employees, and any unique selling points. It’s also important to provide an overview of your team and their experience in the industry. You should include a description of the services you offer, your target market, and your marketing strategy, as well as an analysis of your competition and how you intend to stand out from them.

• Strengths: What will be your company’s strengths when you launch? How do you see this changing in the future?
• Weaknesses: If you were the competition, what would you say to prospective customers about where your company’s services are weak or deficient? What are the most important weaknesses to overcome first?
• Opportunities: With product improvements or new partnerships, where could your business grow? What new segments could you enter in the future?
• Threats: What external factors could put pressure on your business growth or cash flow? Which of these threats can you control? Which ones can’t you control?

3. Don’t forget the financials

All businesses need a solid financial plan, and dental practices are no different. The final part of your business plan should include a financial forecast for the first three years of operation. Banks and private investors will want to be confident that the business they are lending to will be profitable. In this section, you would also set out details of how you will fund the dental practice acquisition, with a summary of funding/ investor if applicable.  Make sure to include relevant research and data to support your financial forecast. Be sure to consult with a dental specialist accountant to ensure that your financials are accurate and realistic. Do contact us if you would like us to put you in touch with an accountant who can support you with the forecast. We at Henry Schein Dental Practice Sales are able to arrange the funding for you, working with the Head of Healthcare within the banks, where you will have access to preferential rates. Contact Henry Schein Financial Services to discuss contact@hsdpracticesales.co.uk

4. Maintaining the business’s success

It is important to be able to demonstrate to lenders that you can maintain the success of the business, by thinking about how it is ran now and the working environment. Describe your skills and experience, why you would be good for running this business? Will you be bringing in new ways of working? The lenders need to feel comfortable with your plans for the future of the business, they need to understand how much time you can contribute to the working clinically and how this supports the handover of the business from the previous owner.

Closing remarks

These are just a few tips to get you started writing your dental practice business plan. Remember, this document is vital to the success of your dental practice, so take the time to do it right! Buying a dental practice is a big decision, but with a well-thought-out business plan, it should be a smooth and successful process.

If you are a dental associate looking to purchase your first dental practice, or an experienced dental practice owner looking to expand your portfolio, the team at Henry Schein Dental Practice Sales can help. We have a wealth of experience in the dental industry and can provide you with the advice and support you need to make your dream a reality. Contact us today for more Market Insights!

The post Buying a Dental Practice? Here’s How to Write a Business Plan appeared first on Henry Schein Dental Practice Sales.

Dental practice valuations identify areas for improvement

By understanding how your practice performs against key benchmarks, you can set realistic goals and targets, as well as develop strategies to achieve them. It allows you to plan your financial future with confidence.

A dental practice valuation can help you understand how to increase profit

Valuations can help you determine if your dental practice is worth as much as you think. If you are looking to sell your practice, it is important to analyse profitability as this is the key component driving your value. Where profit is high you may be able to sell sooner than planned! Or where your profit is lower than expected you can clearly map out a strategy to increase profitability over time.

A dental practice valuation can help determine how much to invest in your brand

Deciding whether to reinvest profits in your business is not always easy. Regular valuations can be used to guide the decision-making process when it comes to investing, whether that be through purchasing equipment, adding a surgery or engaging in strategic marketing activity to enhance your brand.

Prepare for the future with a realistic practice valuation

A valuation can help you develop a strong plan of action 5 to 10 years before you even think to sell or retire. This plays a key role in wealth planning and it can make the difference between selling your practice and having it become unsaleable. In doing so, you will protect the equity in your practice for your family, should the unexpected happen.

The bottom line

An up-to-date annual business valuation helps dentists know where they stand so they can make informed decisions that affect the future of their business. The bottom line is that business valuations are an important part of any practice’s financial planning strategy. They can help partners make more informed decisions about their business and its future, whether that is selling the practice or passing it on to the next generation.

If you’re considering selling, discover your practice’s true market value by booking a valuation with one of our experts.

About us

Henry Schein Dental Practice Sales, formerly MediEstates, is proud to be part of the Henry Schein group of companies. Henry Schein’s mission is to help our customers be more successful so that they can focus on delivering the best quality care.  We provide the best quality and value in products and services, helping our customers, as trusted advisors and consultants, to efficiently operate and grow practices and increase financial return and financial security.

The post 4 Key Benefits of Having Regular Dental Practice Valuations appeared first on Henry Schein Dental Practice Sales.

As part of our commitment to offering the best possible products to our customers, we have partnered with All Med Pro who specialise in dentistry and understand the intricacies of the dental industry. All Med Pro offer tailored insurance solutions backed by experts and comprehensive support for dentists, and other dental professionals, across the UK.

Dental indemnity insurance provides financial protection against claims of negligence or malpractice and is essential for UK dentists and other dental care professionals. It covers legal costs and compensation pay-outs in cases of clinical errors or patient dissatisfaction. By having this insurance, dentists can ensure compliance with legal requirements while safeguarding their reputation and financial stability.

Our partner, All Med Pro, has released 6 new upgrades to their indemnity policies:

The below information has been supplied and verified by All Med Pro in relation to their indemnity policies.

1. Late Claim Notification Acceptance: A New Safety Net

Recognising that prompt claim notifications can sometimes be missed; All Med Pro has updated their policy. Now, even if you forget or fail to notify them of a claim within the policy period, they will still provide cover. This change ensures you’re never left without protection due to an oversight.

2. Enhanced Coverage Assurance: Beyond Basic Requirements

Their updated policies now exceed the General Dental Council’s (GDC) minimum requirements, offering robust and supportive coverage to UK dental professionals. They aim to deliver the most comprehensive protection in the industry.

3. Mitigating Discretionary Coverage Risks

If you are transitioning from a discretionary provider like MDDUS, DDU, or Dental Protection, they’ve got you covered. All Med Pro review and consider claims arising from your time with these providers, adhering strictly to their transparent terms and conditions.

4. Multi-Year Price Stability & Added Benefits

All Med Pro has introduced Multi-Year Price Security, guaranteeing no price increase for the next two renewals on your clinical negligence coverage. Additionally, enjoy extra weeks of coverage at no additional cost, demonstrating their commitment to your satisfaction and success.

5. 1Stop4GP: Comprehensive Health Support for Your Family

Their exclusive 1Stop4aGP service takes care of your family’s health needs, allowing you to focus on your practice. This service includes unlimited appointments, 24/7 access to GP consultations via phone or video, and secure electronic private prescriptions delivered to your home or workplace.

6. Unlimited Free Advice: Project Sphere Initiative

Through Project Sphere, they offer unrestricted access to advice without impacting your indemnity fees. This initiative supports patient safety and professional growth by providing you with the guidance you need, whenever you need it.

To get a quote, click here: Dental Indemnity Henry Schein Financial Services

The post Discover Enhanced Protection: 6 New Upgrades to Dental Indemnity Coverage appeared first on Henry Schein Dental Practice Sales.