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1.0 Executive Summary
Dental Practice, LLC (“the Company”) was founded by Wesley Duncan, DMD. The practice will be based in San Diego, California. The location will provide a broad range of dental services including general care, cosmetic dentistry, orthodontics, and periodontal care. The business will also retain an oral surgeon that can provide dental implants to patients on site. The business is seeking a $400,000 loan in order to establish its offices in the San Francisco market area.
1.1 The Services
The business will generate the majority of its revenues from providing continued dental care to the San Francisco general public. The business, beyond Dr. Duncan, will employ two staff dentists while retaining the services of an oral surgeon. The location will have three hygienists that will provide routine cleanings for patients.
Most services will be covered by dental insurance. However, specialized procedures such as cosmetic dentistry will be paid directly by patients. In order to provide patients with a wide range of treatment options, the Company will work with dental procedure financing firms. Financed procedures will encompass orthodontics, implants, veneers, and other aspects of cosmetic dentistry.
The third chapter of this business plan will outline the services offered by Dr. Duncan and the Dental Practice’s staff.
1.2 Financing
Wesley Duncan, DMD will acquire a $400,000 loan. This capital will be used as follows:
• Dental practice development in San Francisco
• Dental equipment
• General furniture, fixtures, and equipment
• Initial marketing
• Working capital for the early expenses of the business
The business will produce highly predictable streams of revenue on a monthly basis via its comprehensive dental care services. If necessary, the Company could solicit additional capital in order to have greater control over its cash flow as invoices are processed among dental insurance carriers.
1.3 Mission Statement
Dr. Duncan mission is to provide complete and comprehensive dental care services to all those that are in need within the greater San Francisco metropolitan area.
1.4 Management Team
Wesley Duncan has been a practicing dentist for the past nine years. He has extensive experience regarding cosmetic dentistry, which will further create a major differentiating factor for Dental Practice, LLC as it establishes its operations.
1.5 Sales Forecasts
1.6 Expansion Plan
Over the life of the business, the Company will continue to hire additional dentists and specialists in order to further increase revenues. Additional staff (employed and contracted) will include endodontists, periodontists, and individuals that specialize in pediatric dentistry. Once the initial location reaches its maximum capacity, Management may development additional practice locations in the greater San Francisco Bay area.
2.0 Company and Financing Summary
2.1 Registered Name and Corporate Structure
Dental Practice, LLC.
2.2 Required Funds
A $400,000 practice development loan will be used to launch the operations of Dental Practice, LLC. Wesley Duncan will contribute $50,000.
2.3 Management Equity
Wesley Duncan and the Company’s dental practitioners will completely own the business as a matter of law. Staff dentists, in lieu of equity participation, will be given a percentage of their aggregate billings as an incentive for remaining with the practice throughout their careers.
2.4 Exit Strategy
Transitioning a dental practice to another practitioner has substantial complications. The new practitioner needs to become familiar with the established patient base. As such, in the event of a practice sale, Dr. Wesley Duncan will remain on as a staff dentist for twelve months to facilitate a proper transition. Most likely, the Company will work with its staff to acquire the practice from the Founder over a period of years.
3.0 Dental Services
Dental Practice, LLC will provide its patients with end-to-end solutions for all of their dental care needs. The primary focus of the operations will be on standard dental care including cleanings, filling cavities, and other procedures that are part-and-parcel to the practice of dentistry. The business will also provide root canal surgery and other endodontic procedures. Dr. Duncan will also provide general orthodontics and periodontal care. The Company will employ two staff dentists, which will allow the business to generate substantial revenue. Each dentist is expected to generate $700,000 of revenue per annum.
In regards to dental implants, the Company will coordinate these efforts with a retained oral surgeon. The Company will generate $3,000 to $5,000 per tooth depending on the complexity of the patient’s case. The oral surgeon will receive 50% of the revenue produced from implant dentistry.
The business’ dental cleaning services, rendered by staff hygienists, will be a major profit center for the practice. At the onset of operations, the Company will employ three people to render these services. The average dental cleaning produces $185.
Finally, the Company will recognize income from the sale of retainers, braces, dentures, and other products.
The business will work with several specialized lending companies in order to provide affordable monthly payment plans when specialized services are needed by patients. When financing is engaged, Dental Practice, LLC will receive the payment from the lending institution.
4.0 Strategic and Market Analysis
4.1 Economic Outlook
Dental practices operate with a substantial degree of economic viability. People will continue to require comprehensive oral healthcare, and the price of visiting a dentist is generally affordable to most people. Additionally, these practices receive a significant portion of their income from reimbursements. The risks associated with developing a new dental practice are relatively low, and the principal issue faced by these businesses are competitive threats.
At this time, there are no known issues that would impact Dental Practice, LLC’s ability to quickly establish a client base in the greater San Francisco metropolitan area. The wealth of this area, especially as it is home to numerous technology companies, will further ensure a substantial patient flow.
4.2 Industry Analysis
Currently, there are 205,000 practicing dentists in the United States practicing among 160,000 practice locations. Each year, these entities collectively generate almost $148 billion of revenue. Beyond dentists, these businesses employ an additional 750,000 people as dental hygienists, assistants, and support staff.
There have been numerous technological advances in the field of dentistry over the past twenty years. Reduced pain technologies, 3D modeling, lasers, and optics technologies now allow for a greater degree of care to be provided for each patient. The Company will continue to integrate the latest in all dental technologies into the operations of the practice.
As people have become more concerned with their physical appearance, the demand for cosmetic dentistry will continue to increase as well. One of the primary ways that the practice will increase its profits is through the marketing of these services to the general public.
4.3 Customer Profile
The demand for quality dental and oral healthcare spans all socioeconomic levels. Additionally, people will frequently need emergency and restorative services when specific dental issues arise.
Management has chosen to develop the location in the greater San Francisco market area given the wealth of this market. This city is widely recognized as the center of Silicon Valley, and the large population will allow the practice to quickly establish a significant client base. In this section, you can discuss the specific attributes regarding your target market and why you have chosen to establish a practice in this location.
4.4 Competition
As the demand for dentistry is universal, there are always a number of established practices in any given market regarding of market size. This dental practice will differentiate itself from the competition by offering the entire suite of dental services including endodontic, orthodontic, and periodontal care. The Dental Practice’s ability to concurrently providing dental implants via a retained oral surgeon will also set the business apart. Dr. Duncan is committed to providing care to those in need, and the business will have specialized programs available that will ensure that people of all income levels can afford the services offered.
The Company, in order to position the practice as community focused, will offer a number of free clinics. These matters will be further discussed in the next section of the business plan.
5.0 Marketing Plan
There is a significant amount of competition among dental practices that operate within the greater San Francisco market area. The Company will use highly targeted advertisements in order to create an ever-expanding patient base within this market throughout the life of the business.
5.1 Marketing Objectives
• Host free and discounted clinics at the location to establish the brand name of the Dental Practice (including free oral cancer screenings).
• Leverage social media and search engine optimization strategies for the Dental Practice’s online platform.
• Maintain referral relationships with numerous entities including physicians, healthcare professionals, and real estate professionals within San Francisco.
5.2 Marketing Strategies
As the business develops its location in San Francisco, the Company will post updates regarding the launch of the practice among all social media platforms. During this time, the Company will use targeted advertisements among people that live in the greater San Francisco area and have recently expressed interest in general dental care or cosmetic dentistry. This pre-launch marketing campaign will create substantial awareness for the practice.
The business will conduct outreach programs with regional real estate brokerages as well as healthcare professionals in order to generate referrals. As many people move to the San Francisco market area on a daily basis, Dr. Duncan sees a significant opportunity to expand the visibility of the practice through these operations.
In regards to the Company’s website, this will be a state-of-the-art platform that showcase the dentists’ professional biographies, information about procedures offered, costs, and general information about the practice. The Company’s web development firm will be tasked with integrating HIPAA compliant onboarding technology so that prospective patients can book appointments and upload relevant histories directly through the platform. This will expedite the process of someone becoming a new patient.
As it relates to cosmetic dental procedures, the Company will use both online channels as well as advertisements in popular lifestyle magazines that are distributed throughout San Francisco. These advertisements will show before and after pictures of patients that have undergone elective cosmetic dentistry procedures at the location. The Company will coordinate these efforts with a Bay area marketing firm.
5.3 Revenue Overview
6.0 Organizational Plan and Personnel Summary
6.1 Corporate Organization
6.2 Payroll
7.0 Financial Plan
7.1 Underlying Assumptions
• The practice will be developed using a $400,000 loan with preferential interest rate pricing as this is a healthcare business.
• Dental Practice, LLC will not need any further capital during the first three years of operation.
7.2 Sensitivity Analysis
Oral healthcare and the demand for comprehensive dental care is not something that is affected by negative economic changes. Dental Practice, LLC will employ a number of financial strategies in order to ensure continued increases in yearly income while improving profit margins. To further reduce operational risks, the Company will work with a number of dental specialists that will provide surgical services onsite.
7.3 Source of Funds
7.4 Profit and Loss Statement
7.5 Cash Flow Analysis
7.6 Balance Sheet
7.7 Breakeven Analysis
7.8 Business Ratios
