The 2023 Scottish Dental Market in Review
In this short article, Joel Mannix, Associate Director - Dental, outlines the Scottish dental market in 2023 and what he expects to see in dentistry in 2024.
The swift escalation in interest rates, soaring operational costs, and staffing difficulties led many corporate entities to halt their acquisition strategies in early 2023. This resulted in a notable decrease in transaction volumes as companies shifted their focus towards organic growth over acquisitions. Despite this, Christie & Co brought 31 new Scottish dental practices to market last year, arranged over 110 viewings, and secured one offer for every two viewings.
The independent dental market saw a resurgence in the latter half of 2023. With reduced competition from corporate buyers, there was a significant uptick in transactions involving first-time buyers, current owners, or smaller independent groups, accounting for circa 90% of our deals in Scotland. The latter half of 2023 also saw an improved influx of new practices entering the market. Looking forward, we are optimistic about a return to more stable trading conditions as this trend continues in 2024.
This year, we expect to see:
- The transactional volume within the market will rebound. However, it's anticipated that these levels will still fall short of the peak witnessed in 2022. This forecast suggests a gradual recovery and stabilisation of market activity, moving towards a more sustainable pace in comparison to the heights reached during the market's zenith.
- M&A activity from corporate operators will reflect a strategic recalibration, with these entities showing restraint in their investment choices and a heightened focus on long-term value over immediate expansion.
- During a period where corporate entities are exercising enhanced selectivity in their acquisitions, experienced multi-site independent operators and first-time buyers are poised to capitalise on this opportunity. This scenario presents a prime opportunity for these operators and newcomers to expand their foothold in the market and establish a stronger presence.
- Some group operators will continue with strategic plans to review and divest underperforming or non-core sites, reflecting a focused effort to streamline their operations and enhance overall efficiency.
For the full Business Outlook 2024 report, visit: christie.com/business-outlook-2024
