What is the difference when buying a dental practice in a rural location vs an urban location? There are positives to both options and dental transition experts Matt and Joe walk you through the urban vs rural debate.
If you are thinking about buying a dental practice, you’ll learn why it might make more sense for you to consider that dental practice for sale in a rural location over one that’s more urban. Sure, you may prefer to live in a city for the amenities it provides, but consider whether opening a dentistry location in this same location would just add to the noisy marketplace where dentist offices are on every corner. Instead, you might have more luck, and better profits, if you look into becoming a staple of an established close-knit community.
This video will explain the pros and cons of each option.
Matt Scherer: Welcome. My name is Matt Scherer. I’m with PMA Practice Transitions and I help the dental professionals in selling and buying practices in Ohio and Western PA. My colleague is …
Joe Gordon: I’m Joe Gordon. I do the same as Matt does, but I do it for the state of Indiana and Northern Kentucky.
Matt Scherer: Awesome. Our topic for today, Joe, is rural versus urban.
Joe Gordon: Yeah.
Matt Scherer: So buying a practice either in a rural or urban area.
Joe Gordon: Where should I buy a practice, Matt?
Matt Scherer: Well, Joe. I don’t know. Where would you like to buy a practice?
Joe Gordon: Well, one that would allow me to practice dentistry without going to dental school, but that would be a problem.
Matt Scherer: Right. That would be.
Joe Gordon: That would be a problem, but my answer to that would be, it depends.
Matt Scherer: Yeah. I think it does depend, but I will tell you that I think when you look at urban versus rural, a lot of your rural practices are much more profitable.
Joe Gordon: Without a doubt.
Matt Scherer: Why is that? Because you’re dealing with far less dentists per patient population. Urban areas, everybody wants to live in the urban area. The problem is, you’ve got a bazillion other dentists that want to be in that same …
Joe Gordon: There are places in Indianapolis where I almost feel like there’s a Starbucks on every corner and a dentist on every corner. Everybody wants to be around the new, bright and shiny.
Matt Scherer: Yeah.
Joe Gordon: I would say if you’re looking to buy a practice that you definitely have to consider rural.
Matt Scherer: I agree. And rural doesn’t have to be in no man’s land.
Joe Gordon: No.
Matt Scherer: We’re talking maybe hour outside of the big metropolitan area.
Joe Gordon: 45 minutes, depending on where you live and and what the road conditions are and traffic patterns. It can actually be a blessing to be out that way.
Matt Scherer: And keep in mind, I think in today’s society, most people drive a half hour to an hour to work every day. And even if you buy a practice in a rural area, doesn’t mean you have to necessarily live in that rural area. You can certainly move a half hour, 20 minutes outside of … into a more urban practice.
Joe Gordon: I had lots of clients that got up every morning and drove to their practice in a smaller town and then drove back to Indianapolis and had all of the amenities that it offered. But in a small, rural area you don’t compete, as Matt said, so much for patients.
Matt Scherer: Right.
Joe Gordon: You don’t have as much competition for staffing.
Matt Scherer: Staffing is usually-
Joe Gordon: It usually stays more consistent.
Matt Scherer: Yeah. A lot less expensive.
Joe Gordon: And it’s less expensive on your facility costs, whether you’re buying a building or renting a building-
Matt Scherer: Absolutely.
Joe Gordon: There which is adds to your profitability. And depending upon where you’re at, even the thought process of the people that live there is different. You’ll probably have more fee for service and cash business than you will people with-
Matt Scherer: PPO.
Joe Gordon: PPOs. It just all makes a big difference. So when you’re looking at a practice, please do not …
Matt Scherer: Discard.
Joe Gordon: Discard rural practices.
Matt Scherer: No, I think-
Joe Gordon: I think they’re wonderful. I see more and more of them come up for sale and I think people really need to consider.
Matt Scherer: No, I agree. I can’t agree with you more. I think, I always used to preach when I was in the banking world that, look at rural practices. Don’t rule them out. You can basically print money and not have to work as hard [inaudible 00:03:57].
Matt Scherer: So just a consideration. That’s all we’re talking about is consider it, look at all your options when you’re looking at buying a practice. Again, doesn’t mean you have to live in that rural area. You can live 30 minutes, 45 minutes, even it’s not unheard of to drive 45 minutes to work every day.
Joe Gordon: No, not a hardship.
Matt Scherer: So thank you for joining us today. We appreciate it. If you liked this segment, please give us the thumbs up and definitely share it with your colleagues and your friends.
Published by Matthew Scherer on January 20, 2020