Top 10 questions dentists should ask before adding a partner
While bringing in a partner is beneficial for some dentists, others find that after serious consideration, it is not for them.
A hot topic for professional writers and presenters is the transition process and the advantages of adding a partner. While bringing in a partner is beneficial for some dentists, others find that after serious consideration, it is not for them. As you consider the option of adding a partner, ask yourself the following questions:
- Is it a good idea financially? Does it support your long-term financial plan?
Adding a partner can cause significant financial changes for you and your practice. It may require a short-term decrease in personal income, and in the worse case scenario, your income could remain reduced permanently. It’s a good idea to meet with your financial advisors to discuss the impact of adding a partner before taking action.
- Why are you doing it?
It is important to ask yourself why you are really doing this. Answers like “My friend brought in a partner and it worked great for him,” or “The seminar presenter told me I would be sorry if I didn’t act now, because I might not find a buyer later” are not good reasons. Some people should not be partners with anyone. This is not a character flaw, just a fact of life. Take the time to really contemplate whether this is something you want to do.
- Can you share patients, decision-making, and income?
Most doctors who consider bringing in a partner have practiced solo for many years and are not accustomed to sharing patients or the management decisions. Some doctors who add a partner may have had an associate for a number of years and have made a profit from his or her production. Once the associate becomes a partner, the profit for the entire practice, including the profit derived from the hygiene department, is shared.
- Do you have an active practice?
One telling sign is the number of active patients you have. By our definition, an active patient is one that has been seen within the past 14 months, has not died or moved away, and can be expected to return to the practice in the future. One reason partnerships fail is there aren’t enough patients to support the two doctors. We have found a practice needs a minimum of 2,000 active patients and should grow by at least 15% per year to support a second doctor.
- Will your facility support another doctor?
The answer to this question may depend on how you and your future partner plan to schedule your time. If you both plan to work the same hours, you will need more operatories than if you use a staggered schedule. Generally, the minimum number of operatories, even with a staggered schedule, is five.
- Does your practice have good operating statistics?
If your practice is not producing well by growing and collecting what it produces, adding another doctor will only make matters worse. If you are having problems filling one doctor’s schedule, it will be impossible to fill two schedules. It’s like the couple with marital problems that decides having a baby will make things better.
- What is your practice philosophy?
It’s amazing how many dentists have never taken time to write a practice philosophy. If you decide you truly want to bring in a partner, it will be essential to articulate this philosophy to the prospects you meet. Skipping this step may lead to problems later in the practice.
- What is your financial philosophy?
It is not unusual to have two doctors practicing together where one is financially conservative while the other is very liberal. You can guess what these partners argue about. Having common financial philosophy can help the partners work together better and avoid a lot of frustration.
- What are your expectations of a partner?
When I work with a client contemplating a partner, I spend a lot of time helping them determine his or her expectations of their future partner. Although the process may be tedious, it forces the doctor to think about what is important to them. Committing those thoughts in writing is essential. When it comes time to negotiate the buy-in and operating agreements, each partner should share their expectations, and as much as possible, those expectations should be included in the agreements.
- Am I willing to go through the process of finding the right partner several times if necessary?
Adding a partner takes courage. You must be able to start again the moment you realize your prospect won’t work out. While starting over can be expensive and frustrating, I guarantee getting out of a bad partnership will be far worse.