AUTHOR: The Dental CFO
August 27, 2021
In any partnership, a lot goes into success. Each person needs to work with the other to make the partnership work properly. Dental practitioners often find numerous benefits of working together. A dental practice partnership can prove beneficial in allowing the practice to maintain competitiveness as the cost to maintain technology continues to rise. It can also aid in managing flat or decreased reimbursement rates. In some areas, these partnerships are critical for competing with greater competition within the local area.
A dental partnership offers high-level benefits as well. By partnering with other dental practitioners, there’s reduced overhead in the practice. The practice benefits from greater purchasing power, enabling growth without as many costs. There’s also the benefit of continuity in staffing, something that all patients benefit from. New dentists are likely to thrive in such partnerships because of the mentorship opportunities. And, perhaps one of the most common reasons for partnerships is expansion into new specialty practice areas.
From costs to providing a better level of service to your patients, there are numerous reasons to enter into a partnership. However, partnerships can fail easily, especially if there is a lack of communication or work by each person to make the process work. What makes a dental practice successful in this particular design? It’s about minimizing the following risks.
Common Partnership Pitfalls
Partnership pitfalls can happen to any group. These are things that typically occur when there isn’t a structure in place to minimize those risks. As you learn how to run a successful dental practice on your own, recognize that things are different when you begin to work with another person. Some of the most common pitfalls include:
- Not making time to meet. Holding regular partnership meetings allows all involved to come together to determine the week’s or month’s goals. It keeps each person on the same page, more so than just saying “hi” in the hallway.
- Letting individual goals influence decisions. As a partnership, individual goals are secondary to what is best for the partnership itself. The best way to avoid this pitfall is to put practice interests ahead of your own.
- Honesty. Being honest with each other is a big part of success. Each person in the partnership has the responsibility to share openly.
- No set expectations. Just coming together to work as a team isn’t enough. It’s essential to have a well-written dental partnership agreement that outlines the details of the agreement, the expectations each person has with the other, and expected goals.
- Not involving an accountant. Let’s be frank, the devil is often in the financial details. If there is a lack of financial oversight by a third party, complications can arise. Be clear about the financial implications.
Many of the challenges of running a dental practice are minimized when these common pitfalls are planned for in advance.
Are you ready to learn more about creating a dental partnership? The Dental CFO offers the resources you need to get started. Contact us now.
How to Prepare for a Successful Dental Partnership
Another way to look at success in partnerships is to make a strong effort to create success and prepare for it. That is, instead of going into a partnership and working through problems as they occur, work to avoid them in advance. Doing this may provide one of the best opportunities for avoiding negative situations.
When a challenge occurs in a dental partnership, both people have to come together to find a solution. Yet, when there’s no game plan for how to do that, the end result is nearly always complications, hurt feelings, and damaged relationships. That’s why preparing for this is a core part of successful dental practice management.
How do you do that? Here are a few key factors to take into account. This is where success starts.
Evaluate the Financials
At the core of any successful partnership is communication. Start with the financials, one of the hardest components of any relationship. Discuss what each person is bringing, financially, into the partnership. That includes all assets. It’s also essential to consider expected compensation – not just monetarily but also with benefits. Discuss ownership of the partnership. Will it be a 50/50 split? Dental practice management consultants can help to ensure this is all clearly outlined and that each partner’s interest is properly represented in the organization.
Evaluate the Patient Flow Capacity
Look beyond the goal of having as many patients as possible. How large is the space and how many people can it accommodate? How much practice time will each person put into the business, therefore determining how many patients they can see on a consistent basis? Discuss expectations in the type and amount of work each partner is contributing to the larger organization. These can be difficult topics to discuss.
It’s also critical to have a good amount of focus on your specific needs and goals. Consider factors such as:
- Work ethic – does yours match your partners’?
- Practice philosophy – clearly define what you believe is important within the practice to ensure these beliefs are shared amongst all partners.
- Leadership style – Do you prepare to run a tight ship or is a more relaxed practice your expectations? This, too, directly impacts your ability to work together.
- Personality type – Many dental practitioners are inherently leaders, but some are more easy going and likable than others. Do your personalities compete or complement each other?
What other components define the amount and type of success you could have? Examine your relationship with the dental professionals you want to work with to determine where concerns may be.
Define Expectations and Motivations in Advance
Clearly write down what your expectations are for working with other people. Look deeply into what is important to you to have present within your organization. Some people may want a strong profit-focused business. Others may be looking for good community service.
Communicate these expectations with each other. Be sure that they align with each other before moving this opportunity ahead. Not only do you need to communicate what’s important to you, but it is also important to listen and really understand what is valuable and essential to other people as well. What does your prospective partner need for this to be a success? Remember, it takes at least two people to make this work and both of those individuals have needs to fill.
Seek Professional Help
It’s also critical to work with a professional organization that can provide support to you in determining the financial feasibility of such a relationship. A dental CPA can work closely with all people involved to gather information and insight. This can then be communicated clearly so that all partners understand what their responsibilities and expectations are.
In addition to this, working with dental practice management consultants to help with financials and to develop a written partnership agreement is a strong part of the building of a successful dental practice. It is here that your business can gain the grounding and clarity necessary to advance it.
How to Maintain a Healthy Dental Partnership
Once your partnership is established, the first few weeks will be hectic and a learning process. You’ll spend time trying to communicate effectively and there may be some times when you step on each other’s toes. In the coming months, you’ll need to work through challenges with an open mind recognizing that it takes time for success to build. There are a few things you can do to make that possible.
Nurture the Relationship
Work hard to build a good relationship with your partner. Make sure that you are respectful to each other. More so, realize that the way you operate your business may be different than the way your partner does. For that reason, you’ll need to be open minded and willing to learn why others do things the way they do. Most often, there’s something each person can learn from the other. Be willing to do that.
Regular check-ins are a big part of the process of building success. At first, you may be spending a lot of time together doing this. However, over the next few weeks, the practice will grow and become busier. That’s a good thing, but it cannot be more important than regular meetings with your partner. This is the time to talk about the relationship, discuss challenges, make rules, and manage the finances together.
Keep Goals in Line
Make sure that the goals of each person align with the other. That takes time and, in every situation, there’s some flexing of those goals. Your goal is to make sure every decision you make is for the betterment of the practice.
Making the decision to work together means really doing just that – working out the problems and working towards new goals. Make it a point to do that especially in the first year of operation.
Bring in the Right Support to Help You Succeed
A well-built partnership should be a rewarding experience, both personally and professionally. Both dental partners should see the experience in that way to ensure it is possible. There will be some bumps along the way since every person has his or her own needs and goals. The way through those concerns is to communicate and come back to the same statement. What is best for the practice?
Although sometimes risky, you can still structure a successful partnership arrangement in most cases. We can help you make that happen. Set up some time now to request a free consultation. Meet with us and learn what your next opportunities are.