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MediEstates - The evolution of the dental business market
The evolution of the dental business market


The evolution of the dental business market


What did the dental business model look like when you first came into dentistry?
AB:
The business model of UK dentistry looked very different two decades ago. When I set up my first business, MediCruit, back in 2001 the market was in the early days of fledgling dental corporates which were looking to buy dental practices and recruit staff.
The internet was in it's infancy and companies offering specialist services across the dental spectrum, such as practices sales, staff recruitment and practice funding barely existed.
Dentistry was a 'profession' in the traditional sense of the word and as I gained more experience in the market and got to know the people I sensed there needed to be a shift in attitude. Although not everyone could see it at the time, dentistry was actually on the verge of a major revolution.

What were the major drivers for changes in the dental market at that time?
AB:
Corporatisation, increasing competition and the move towards the private sector were all important factors in bringing about change and slowly, practices started to recognise the need for diversification to stay ahead of the game. With the rise of corporate dentistry, increased competition meant the buying and selling of dental practices was regarded as something of an investment opportunity, attracting private equity groups which bought up practices at an astonishing rate. At the same time GDS contracts were being finalised, giving security to dentists and this combination of factors resulted in a spectacular increase in goodwill values.

Is the market for dental practices still as buoyant today?
AB:
The days of creating a practice or group that could be sold at a profit within a relatively short turnaround time have gone and individual dentists, corporate and group practices are increasingly seeing dentistry as a long-term investment opportunity. The market for buying and selling practices continues to evolve and the pattern of ownership, especially of group practices and mini-corporates, looks very different from that which existed even two or three years ago.
We are currently seeing buoyant growth in the mid-market sector backed by private equity, because group buyers have correctly identified the benefits of a high return on investment versus the minimal risks associated with owning a mid-market practice. A mixed practice with a secure NHS contract in a good area for recruitment is really a fail-safe business and, in my opinion, it will continue to be so whilst there are remains guaranteed income via NHS dentistry from central government. Even with the pending new contract funding is still likely to be secure, making good NHS practices an attractive proposition for this segment of buyers.
As a result, interest around buying and selling practices, both for investment and professional reasons has grown and decisions around how to fund a practice purchase, or understanding how practice valuations are calculated, has become a topic of interest for dentists. I always maintain that whether you're a vendor or a purchaser it's important to get the best deal you can and that's where the advice of specialists can be so valuable.

From a business perspective, what do you believe is the future for dentistry now?
AB:
As in any business, in dentistry you cannot afford to stand still for any length of time. I'm seeing more of today's dental practices looking to diversify, moving away from the more traditional family practice model, into the private, specialist and cosmetic sector, which, despite recession and economic uncertainty, remains a hugely attractive area. Corporate dentistry remains a major and influential player and increasingly mid-market buyers - micro corporates and smaller groups - are looking to acquire strategically positioned practices in prime locations.
Practice owners always want to maximise values and purchasers need to be confident that what they buy represents good value, not just in the short term, but for many years to come. That is why we think it is important to provide a bespoke service to those looking to buy or sell a dental practice, while also helping them to recruit the best staff to ensure their business is a success.
Posted by: Anne Barker on 22 Oct 2018

General Buyer Terms 

This agreement is in relation to MediEstates Limited whose registered office is at 1st Floor, Pacific House, Stanier Way, Wyvern Business Park, Derby, DE21 6BF acting for and on behalf of our clients ("the Vendors"); and yourself (Buyer's Name) in relation for an introduction to a prospective sale of a business as a going concern. By registering through this agreement I agree to all terms set out below:

  1. Definitions
    In this Agreement the following terms and phrases shall have the following meaning unless the context otherwise requires:

    Business
    Dental Practice business providing dental care. This business is under the MediEstates Ltd sale terms.
    Confidential Information
    Means the actual Vendors identity and all confidential information in respect of the Business, including, but not limited to, any ideas, business methods, prices, accounts, finance, marketing, research, development, manpower plans, processes, market opportunities, intentions, design rights, product information, customer lists or details, employees’ details, trade secrets, computer systems and software, and other matters connected with the products or services manufactured, marketed, provided or obtained by the Vendor, and information concerning the Vendor’s relationships with actual or potential clients or customers and the needs and requirements of such clients’ or customers’ operations.
  2. Obligation of Confidentiality
    The Prospective Purchaser agrees to treat as confidential, information supplied by or on behalf of the Vendor in connection with the sale of the Business.
  3. Exclusions
    The obligation of confidentiality set out in clause 2 does not apply to:
    1. any information received from a third party who was legally free at the time of disclosure to disclose it;
    2. any information which was already lawfully in the Prospective Purchaser’s possession prior to receiving it from MediEstates Ltd on behalf of the Vendor; and
    3. any information which is in its entirety already in the public domain.
  4. Duties of Prospective Purchaser
    1. The Prospective Purchaser shall take such a reasonable security measures to protect the Confidential Information and trade secrets.
    2. The Prospective Purchaser shall not, without the prior written consent of the Vendor, permit any of the Confidential Information:
      1. to be disclosed, other than in confidence to its legal or professional advisors;
      2. to be copied or reproduced;
      3. to be commercially exploited in any way;
      4. to be used for any purpose other than in connection with the prospective purchase of the Business;
      5. MediEstates is registered under the Data Protection Act 1998. Upon Signing this agreement you agree to follow the legal obligations of this act to protect the details of the information supplied to you, with it no to be passed outside of the control of you the prospective purchaser.
    3. The Prospective Purchaser agrees to keep a record of Confidential Information received.
    4. The Prospective Purchaser will return to MediEstates or the Vendor all documents containing Confidential Information and all copies of those documents on demand at any time which are in its possession or under its control, and for this purpose the term “documents” includes computer discs and all other materials capable of storing data and information. The Prospective Purchaser agrees that such documents remain the property of the MediEstates on behalf of the Vendor.
    5. The Prospective Purchaser must not jeopardise or re-direct the sale under any circumstances.
    6. The Prospective Purchaser must not contact the Local Area Team or CCG regarding any practice sale, by any means of media unless written permission is granted from the Vendor.
    7. To carry out own due diligence on practice purchases and accepts that any information MediEstates has supplied is information provided by the vendor and is not responsible for its accuracy or completeness.
  5. This Agreement
    The existence of this Agreement and its terms are confidential and neither MediEstates nor the Purchaser may disclose anything about this Agreement or its subject matter or implementation to any person other than in confidence to their legal or professional advisers.
  6. Duties of Prospective Purchaser
    When buying Dental practices, finance is normally needed. Our organisation operated over more than one of the MediHoldings brand, by completing this from you agree that the information can be shared to our other organisations to avoid the need to register independently and provide the best possible service.

    MediEstates will refer you to the specialist dental lending team and MediFinancial who will contact the necessary banks, whom have preferential healthcare lending rates in some cases, to ascertain which funding is available to you.
    By signing this agreement you do not have to use any of the banks MediFinancial contact, it is just another service which we provide.
  7. Deposit for Dental Practice
    If you are interested in putting forward a formal offer in for a practice, once the offer is accepted there will be a deposit required to secure the practice sale which is dependant of the practice size. This deposit is held in a client account and will be returned to the buyer on completion of the practice sale. You the buyer, will be required to sign a deposit schedule which will cover the buyer and the seller in the event that the practice sale does not proceed.
  8. Changes to this Agreement
    Any changes made to this agreement must be authorised and signed by one of MediEstates Ltd Directors.
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