As anybody who has been looking for an NHS practice knows, it's a fiercely competitive part of the market which has seen dramatic price increases in recent years. The lure of 'guaranteed' income draws many first time buyers and owners into the sector almost to the exclusion of any other practice type.
However, as our Dental specialists predicted in our annual Business Outlook report a couple of years ago, there is an increasing trend for buyers to acquire good quality private practices which are generally easier to buy, that have fewer buyers chasing them, and can actually offer greater returns on capital employed. Not only that, but the multiples you'll pay are lower than in the NHS sector.
The private sector is also increasingly attractive to multiple operators, and we see a large number of multiples coming to Christie & Co looking to expand their reach into the private dental sector. Buying a private practice is, of course, more of a risk, but allows operators to spread their income across the sectors, guarding themselves against any significant change in NHS funding in future years.
The other attraction of owning a private practice is the potential to grow business through the introduction of new and innovative dental treatments, such as implants for example, as well as the increasing range of cosmetic and aesthetic treatments on offer that can be highly lucrative.
We are seeing that banks are also happy to support the private dental sector and as the economy continues to improve and dentistry itself becomes more accessible, it's logical to expect private practices to thrive.