Hours of Operation
Whatâ€™s best for your practice?
One of the top 10 questions asked when someone is selling a dental practice is: â€śWhat are the ownerâ€™s hours and days of operation?â€ť Time spent to generate income, and the specific patient expectations as to when that time must be spent has become a key factor that motivates and attracts a purchaser to a practice. There are many views on what hours are best for a specific practice, and the decision may have an impact upon both a buyerâ€™s perception of the practice and to some extent, the sale price.
Todayâ€™s buyer is typically a young associate, many of whom have been asked to work evenings and weekends. Principals have earned, and rightfully enjoy the privilege of limiting their practice hours to a more traditional daytime schedule. However, when buyers are considering the purchase of a practice they are quick to suggest that they no longer want the late nights and weekends away from family and friends. Some have remarked: â€śI have paid my dues, and I want a more regular schedule.â€ť
Todayâ€™s buyers are ambitious and willing to work hard, but they are more motivated by lifestyle than dentists of previous generations. Many dental offices are situated in retail plazas and malls. It would be absurd to suggest that these dentists cut back to a â€śnine to fiveâ€ť work week merely to attract a buyer, but it is also relevant to suggest this does have some bearing on saleability and price. When a practice is in its early stages, it may be necessary to open evenings and weekends to build the patient base. Some landlords specifically require the dental office to be open during all mall hours (9 a.m. â€“9 p.m. for example). Todayâ€™s buyers are reluctant to buy such offices, as they simply do not want the burden of staffing the practice with associates if only to meet the landlordâ€™s demands.
These three questions need to be answered by all prospective purchasers:
1. Where do you want to practise?
2. What hours and days do you want to work?
3. What is your family structure and location?
Young dentists often mention a desire for less work and more play. This may be due to the generational attitudes of dentists under 40 who often have very different attitudes about when, and how much, they should work in dental practice. They donâ€™t lack the work ethic, however most are ready and willing to make an honest commitment Of note is that between 50 and 55 percent of graduates from Canadian dental schools are now women. Female dentists of child-bearing ages may still wish to own a practice (much like men) but they are realistic about the demands placed upon women when raising a family. If you project the predominance of women in dental practice over the next 10 years, it is likely that the most desirable practices will be those who purposely built or designed their schedules to accommodate the next generation of mostly female buyers.
What should you do if your practice is going through a change and your hours are being affected? Should you strive to maintain longer hours and work evenings and weekends and keep your gross up? Should you extend yourself to make the practice value higher? Should you allow a decline in hours worked, resulting in lower gross and net income and thus a lower appraised value? A dental practice can be altered, in terms of hours, days, policies and services rendered, given enough time, but sudden change in any key operational feature is not recommended in any business. If you choose to reduce or modify your office hours, your loyal patients will appoint during the hours set by the practice. Do you really need to open evenings or weekends to attract and retain patients? Yes, it is proven that extended hours can attract new patients, especially those in newer residential areas where young families have little choice but to seek evening and weekend appointments. On the other hand, I challenge you to consider the costs of the extra time spent working those hours as your practice matures. Lifestyle is important to the new generation of dentists. You may want to consider modifying your working hours to make your practice more attractive to the buyers of the future.
Timothy A. Brown is the President & C.E.O. of ROI Corporation & ROI Capital, companies that specialize in dental practice appraisals, brokerage, consulting, locum placements, associateships and practice financing across Canada. Tim Brown is also the author of Profitable Practice , an essential read for any practising dentist interested in maximizing the worth of their practice. Timothy can be reached at 905-2784145 or [email protected].