Dr. Walter Colon answers questions about his decision to buy a periodontal practice after finishing his residency...

2005 Student Event: Scaling to New Heights in Periodontal Practice
STARTING OUT BUYING A PRACTICE

Below is an interview with Dr. Walter Colon.
PhotoWalter Colon, II, D.M.D., is in practice in Tallahassee, Florida. He completed his periodontal residency at University of Kentucky in 2000.

What is the most rewarding part of what you do everyday?

Being able to treat patients well in a state of the art, well organized, service oriented practice with a good team.

What was your ideal plan after graduation?

Find the best opportunity in the state of Florida.

What factors affected your plans and decisions about your career and future?

Practice potential, location and ability to work with the people already present.

What appealed to you in terms of buying a practice?

Good mentorship, fair buyout, ability to practice some specifics of training, size of the practice (implants, IV sedation etc.), practice history.

How did you begin the process of buying your own practice?

I was seeking a practice in which a transition would occur for a short associateship and then a buyout.

Did location influence any of your decisions?

Yes but not too limited. I was open to options within an entire state.

Did you meet with an attorney, practice consultant or accountant before pursuing a loan? Why or why not? What did they do for you and why was it beneficial?

Yes, I met with all three. These steps are very important and were beneficial to me. You also must have your own of all of the above.

How did you determine the financial requirements for buying a practice?

Practice analysis by a broker (ideally done by the practice consultant being used, not done in my case).

How did you obtain financing?

Owner financing (very important).

What risks were involved in starting your practice?

Largest risk was failing at the transition due to personalities (other doctors, staff, community and referring dentists). The second largest risk was not being able to afford the practice at the set fee.

How did you assess and manage those risks?

One year associateship with a clause to leave if unsatisfied or the owner could choose not to sell me the practice.

Did the original owner work in the practice in the beginning or retire?

Original owner worked for 3.5 years on a tapering scale. (Decreasing .5 days per year until 2.5 day per week.)

If the original owner remained in the practice, do you have any suggestions for making this a win-win for the past owner and the present owner?

A plan from the start on the above.

What is your situation now?

Owner. Senior doctor retired fully, paying note ahead of schedule.

Did you restructure the practice’s finances in the beginning to pay the bills, yourself, staff and/or buy new equipment, etc.?

Minor restructuring only due to the presence of a 3rd doctor, myself.

What financial issues or considerations came into play when planning for the future?

Living within your means (this goes for always). Unfortunately that means obtaining the vitals, and increasing items such as disability insurance as able. It is very important to keep these updated as practice develops

Using real or fictitious numbers, how did the realities of your finances compare to the plan you originally outlined?

Better than outlined as indicated above.

What resources (i.e., people, publications, web sites, groups) did you find the most helpful?

What suggestions do you have for individuals buying a practice?

Have a good idea of what you want (location, type of practice, type of transition (buyout, partnership, solo). Do as much research as you can. Visit as many times as possible. Once is not enough.

What was your biggest mistake when buying your practice?

Not being able to foresee some issues with the complexity of buying out a practice and becoming a partner with another person simultaneously.

How many employees do you have?

19 employees for 2 doctors.

What is the most important thing you have learned?

Evaluate the people well. Your senior doctor can make you and so can your staff. Know that everyone is on board.

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