04 May Practice Merger Benefits
A practice merger occurs when an existing practice owner acquires another practice in their immediate market area and “merges” the two practices together to form a larger, more profitable, single practice. Contrary to what some believe, a practice merger does not create a co-ownership practice environment. In a practice merger, the purchaser is the solo owner of the newly created, larger practice.
It is generally agreed that a practice merger is the fastest, most reliable way to jump-start any dental practice. If you’re really serious about practice growth, there is no debate that a merger is the best means possible. A merger provides an immediate inflow of quality patients as well as an instant reduction in your practice overhead percentages… both of which instantly produce greater profits!
Practice mergers can be structured as walkaway sales (meaning the seller retires immediately after the sale) or as PreSales (meaning that the seller remains with you as your associate for a set period of time). Practice mergers can also be utilized to create a viable opportunity to add an associate without you having to relinquish any of your patients. Creating passive income (income that does not require that you personally do the production) is often a desired outcome of a practice merger.
Thus, practice mergers are very attractive options for dentists who are seeking more production for themselves personally as well as those dentists who are very busy already but yet wish to vastly increase their personal income immediately.
Since 1988, we have assisted numerous clients with practice mergers and we have watched each of these doctors instantly increase their personal incomes by significant levels and dramatically enhance their “Quality of Life.”
Below are just a few reasons why a practice merger may be a great option for you to consider:
A practice merger will INSTANTLY increase your personal income: It is not uncommon to experience an increase in your personal income the very first month after completing a practice merger transaction. Depending on the size practice you acquire, a practice merger can easily increase your annual income by $75,000, $150,000, $200,000, or, in some cases, even more the very first year!
A practice merger will INSTANTLY increase your patient flow: Not only will a practice merger supply you with a large and steady inflow of new patients, a practice merger often provides new patients for your practice who are already educated about the benefits of optimum dental care. Some of the new patients will already be active in a hygiene recall program (a wonderful source of passive income). How long will it take you to cultivate another 1,000 quality fee-for-service patients without a practice merger? In a merger it happens overnight… literally!
A practice merger will INSTANTLY eliminate a competitor in your market area: As we said, a practice merger occurs when you acquire a practice that is in your immediate market area. This practice was a competitor prior to the merger and a part of your practice after the merger… one competitor gone!
A practice merger will INSTANTLY prevent another competitor from entering into your market area: Purchasing a practice for merger will also prevent another doctor from acquiring the practice and instantly achieving a stronghold in your area. By not acquiring the practice, you run the risk of allowing a younger, more aggressive and more formidable competitor than the seller ever was to enter your marketplace! It is often hard to justify setting a practice up from scratch in a saturated market area. The costs are great and the risk of having no patients is great. It is not impossible, but it is unlikely that a competitor will be able to set up from scratch in your area and have a major negative impact on your practice. But a competitor who acquires a thriving practice in your area is a completely different scenario. That is a true competitor!
A practice merger will INSTANTLY provide you with additional doctor coverage in your practice: If you elect to acquire a practice for merger under our Presale Program, the seller will remain with you and work as your associate for a specific period of time. What better associate could you have than a doctor who is in no way interested in sneaking YOUR patients away from you or otherwise damaging your practice? In fact, a seller is actually just working because the seller wants to stay busy and continue to have some income because he or she is just not quite ready to fully retire. A seller brings both patients and years of practice experience to a purchaser. The purchaser can take some well-deserved time off and still know that the patients are being handled and the purchaser’s practice income is still flowing! When is the last time you took a three-week vacation? You could do so after completing a PreSale Practice Merger! Increased income and continuous office coverage equates to FREEDOM!
The fundamental economics of a practice merger makes it virtually impossible for the transaction not to be an immediate financial success! While the success of any transaction of this nature is not something that anyone can guarantee, the fact that we know of hundreds of successful practice mergers and don’t know of a single failed practice merger transaction is a noteworthy indicator of success.
You owe it to yourself to investigate Practice Mergers. Many of our Practice Merger purchasers have completed more than one merger acquisition. This makes perfect sense since it is so profitable and provides a significant income increase immediately. A Practice Merger is a life changing career option! Call PARAGON today for a complimentary consultation.
