• Why Buy?
Jun 12 2018 - Simon Palmer - Buyer: buying

Once upon a time, buying a dental practice was a rite of passage that almost all dentist graduates went through after a few short years in the workforce. In more recent years however, statistics have shown that being an employee/contractor/non-owner dentist for life is a growing choice for dental graduates. There are many reasons that people give for this trend, including:

  • Increasing numbers of graduates.
  • Increasing competition for patients and stories of practices failing.
  • Increasing corporatisation/aggregation in the industry.
  • Increasing costs and effort associated with compliance/regulations (WH&S, sterilisation, workplace relations, AHPRA regulations).
  • Increasing costs of setup (the cost of equipment considered “standard” by most young dentists is increasing over time).

These reasons are all valid. It is definitely more expensive in real and comparative terms to get into practice ownership than it was 10-20 years ago; the burdens of ownership (in terms of compliance) are higher, the competition is fiercer and the risk associated with failure has also increased. HOWEVER, what seems to be overlooked by those choosing the non-owner-for-life path, is that there are still massive benefits that come with practice ownership that are not going anywhere. Here are some of them:

Job security

When you are a dentist working for someone else, you don’t have job security.

  1. It is possible to get fired or be made redundant.
  2. You aren’t in charge of patient allocation or rosters and, as such, can find that your income is drastically reduced, purely because the owner has hired too many dentists or just because it is quiet and they want to ensure that they are busy first.
  3. You aren’t in charge of fee levels or marketing and can find that your income is drastically reduced as a result of management decisions that are out of your control (loss leader scale and clean, dental plans, etc.).
  4. If you go on maternity leave, you don’t have as much flexibility regarding how or when you will return.

Only practice ownership gives you ultimate work security and flexibility.

Work options

With the oversupply of dentists getting worse by the year, more and more are not able to find the work that they want/need in areas close to where their family and community are settled. When the area that you wish to live in isn’t flexible and jobs in that area are scarce, practice ownership (through purchase or set up) may be the only solution.


Many dentists get frustrated working under leadership and management decisions that they don’t agree with, and want the ability to create and work in their own ideal practice, rather than someone else’s.

Usually, the only way to get professional, managerial, clinical freedom and autonomy is through practice ownership.

Wealth creation

Last, but certainly not least, many dentists’ main motivator in choosing practice ownership lies in the possibility of higher wealth creation. On top of all the points raised under job security, practice ownership also adds the possibility of:

  • Leverage. As an employee, your income is limited to what you can generate with your own two hands. Once you become a practice owner, it is possible to start getting income through the efforts of other dentists and hygienists working in your practice. You can get sick, go on holidays or just take a break, and still have income coming in to pay your staff, rent and other bills. Once you learn how to leverage yourself in your business effectively, it also allows you to scale your operation and wealth creation, to take advantage of business opportunities that would have been impossible if you were trying to do everything with your two hands.
  • Flexibility in tax planning. In business ownership, there is a level of tax flexibility that is available that is not available to a solo dental employee/contractor. Ask you accountant about this.


Chances are that a non-owner dentist’s career will be one that is marked with some frustration, either at the lack of opportunity for wealth creation or not having control over their professional lives. This frustration may not appear on a daily or even regular basis, but there will be times when they will feel helpless in the face of (what they see as) compromises to the:

  • materials and/or equipment that they would choose to work with
  • the days or hours per week or weeks per year that they chose to work
  • quality of the staff or the service to the patients

It is at these points that the non-owner dentist will know the answer to “why buy?” and, depending on the severity or frequency of the compromises, wish that they had taken a different path.


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