Ask the Expert: I’m considering practice ownership. What do I need to know?
Dear Dr. Jerkins: I’m considering becoming a practice owner, but I’m not sure it’s the right choice for me. I'm curious about the practical advantages and challenges that come with practice ownership. What do you think I need to know before starting down this career path?
— Aspiring Practice Owner
Dear Aspiring Owner: Becoming a practice owner is a big undertaking. From finding a practice to running it (while also treating patients), there’s a lot to consider and plan for. In the early stages of understanding whether this is the right career move for you, it’s important to consider how your life would change once you move from associate dentist to owner. Let’s first look at the pros and cons of becoming a dental practice owner.
PROS
• Financial opportunity: Practice owners earn more on average than associate dentists because they directly benefit from profits. In addition, owning a practice means building equity, which can become a valuable asset when you sell or retire.
• Professional autonomy: As the practice owner, you will have the independence to make decisions about the practice’s operations. This will allow you to create a practice that aligns with your clinical philosophy and professional goals.
• Personal fulfillment: In addition to these more tangible benefits, practice ownership can provide you with greater job satisfaction. It also allows you to build strong relationships within your community.
CONS
• Increased responsibility: As the owner, you will have to manage all aspects of the business in addition to treating patients. This could lead to greater stress and time commitment, impacting your work-life balance.
• Financial risks: Becoming a practice owner is expensive. Whether you fund most of it from your own pocket or use a loan to finance the practice, you will be financially responsible for a big expense.
• Liability: As a practice owner, you will be more exposed to legal and financial risks, like malpractice claims and business liabilities.
SHOULD YOU OWN A PRACTICE?
In addition to the various benefits and drawbacks of practice ownership, consider your personal abilities and wants like:
• Experience and skills: Do you feel capable of handling the nonclinical aspects of running a practice? Do you have any experience with business management?
• Personal goals: What are your long-term personal and professional goals? Do they align with practice ownership? Could practice ownership interfere with any of your goals?
Once you’ve thought through these factors and more, it’s time to make your decision. While moving from an associate to a practice owner can provide opportunities for professional growth and financial advantages, it also comes with additional challenges and responsibilities. Ultimately, the decision depends on your personal and professional goals, your financial stability and your preparation.
If you aren’t sure about solo practice ownership, becoming a partner in a dental practice can provide some of the benefits of ownership without the challenges resting solely on you.
No matter which path you take, whether associate, partner or solo owner, Panacea Financial is ready to help. Panacea practice loans can help you reach your ownership and career goals. Learn more at panaceafinancial.com/ada.
Dr. Jerkins is the president and co-founder of Panacea Financial and a practicing physician in Little Rock, Arkansas. Panacea focuses on providing world-class financial services for dentists, physicians and veterinarians through all stages of their training and practice. It offers a full suite of banking and technology solutions specifically built for doctors, by doctors. Panacea is endorsed by ADA Member Advantage as the exclusive provider of practice financing, which includes partnership buy-ins. It is a division of Primis and insured by the Federal Deposit Insurance Corporation.
