What is a squat practice?
A dental squat practice is a a start-up business, usually run as a single chair operation in a leased suites of rooms.
Dentistry is an essential service that everyone needs, and successful dental practice can be a highly lucrative venture. Many dentists start their entrepreneurial journey with a small single surgery practice, known as a squat practice, and then work towards growing their customer base and business over the next few years.
If you are thinking of starting your own venture, then you have a couple of options: you can start a dental practice with a partner, buy an existing practice or go solo with a squat practice.
There is a significant upfront investment with any new business, and a dental practice is no exception to that. When it comes to securing finance for a squat practice, it pays to have an expert broker on hand to ensure you get the best possible deal on the market.
Paying for premises, staff, equipment and everyday running costs might still need more than £100,000 worth of investment in the first year alone. At Rangewell, we understand the challenges and can help you find the solutions.
Setting up a squat practice can let you cut the cost of running your own dental business, but you need to ensure you have the right type of funding for each purpose. There may be a number of different funding opportunities available to you, which will help you to:
The first cost for any squat dental premises in a good location will be a location with parking and public transport nearby.
Rooms above high street retail premises may still be a good choice today, offering the ideal combination of a location that is easy for patients to find and reach, with costs far lower than ground floor premises.
Look at the local population and how well this suits your business plans. For example, in a commuter town, evening appointments for city workers may be favoured.
Consider parking and disabled access and your need for fresh air - your patients and equipment like your compressor need ventilation.
Finally, don't forget the appeal of the building. An attractive building that does not look clinical might be more appealing to your patients.
You will need a minimum of around 120 square ft for your treatment room and probably twice that for a waiting room. You should factor in space for storage, reception and circulation, and you will have the substantial square footage to pay for.
However, it could be a sound plan to get more space than you need immediately. You will not want to move your practice once you have set it up, and another room for a partner could let you grow your patient list, while a dedicated space for a hygienist could help increase turnover.
Cutting corners on your premises can be limiting because a small practice can stay small and unprofitable. Finally, remember that you will need to apply for building regulation consent to use premises for surgery in most cases. But, again, your council planning department will be able to help.
You may need to borrow for the deposit on a long-term lease - because the property you need is likely in demand.
Alternatively, once you have established your practice, you might want to consider a commercial mortgage. Commercial mortgages can help you buy your surgery or even an existing practice.
Commercial property finance will always be arranged on an individual basis. Get our help finding the most competitive lender.
Your practice will be judged on appearances. Your patients will instantly see the difference between cheap plastic chairs and quality leather seating, carefully chosen decor and internet art - and assess your practice accordingly.
They may be less judgemental of the dental equipment you use - but cutting corners in your surgery is likely to be a false economy in the long, if not the medium-term.
The list of equipment your surgery requires is growing, and so are the costs. Your equipment needs may include:
At Rangewell we have found that Asset Funding can provide the most cost-effective solutions for most kinds of equipment you will use as a dental professional. Leasing and hire purchase let you spread the cost of the equipment you need allowing for fixed monthly repayments enabling you to budget with confidence whilst enhancing your cash flow.
If you need equipment that you want to go on giving service for years, hire purchase can provide a simple solution. You pay a deposit plus monthly instalments over a fixed term, between 12 and 72 months, after which the equipment becomes yours. Payments are fixed, making it easy to plan ahead and arrange an agreement that is tailored to your monthly turnover and budget.
If you want to use the latest equipment without the responsibility of owning it, leasing will give you the freedom and flexibility you need. There is usually no upfront cost to find, meaning that you can bring the latest equipment into your surgery without delay.
Leases can make higher cost items, such as digital x-ray systems, more affordable by spreading the cost across their economic life. At the end of the agreement, the asset may either become yours or be returned to the lease company.
You pay a monthly rental charge to use the asset, which will cover all the costs such as maintenance and repairs. It means an operating lease ideal for sophisticated technical apparatus which has a limited life, or which you may want to replace when new technology becomes available – helping you keep ahead of your competitors, and letting you offer your patients the latest treatments.
Good quality used equipment can be a sound investment, especially if you are setting up a new practice and funds are tight. However, many dental professionals miss out on the potential savings because they believe they need to find the cash to pay for it.
At Rangewell we can help you spread the cost of used equipment with dental equipment finance. The terms and rates we can secure are often better than those offered by equipment suppliers, and we may be able to help arrange a single agreement to cover all your equipment needs.
Dentists are always in demand - but simply opening the door on your first day will not see a line of patients file in. You may have to fund all the outgoings of your practice for months until you achieve the patient numbers you need to cover them.
Working capital finance is designed to provide the working capital you need. It's often used to provide cash to pay staff and suppliers while business is slow during the early weeks and months of a new practice, or during a period of growth. It is usually designed to be repaid in the short- to medium-term, once the practice is fully on its feet.
It is essential that as a practice owner and business manager, you invest in marketing. Inadequate marketing is one of the key reasons for the failure of start-ups. People need to know where you are and what you offer. the local press can be important to spread your sales message, but a good quality website is essential and you should give consideration to search engine optimisation (SEO). Setting the website up before the practice opens should be a priority.
Your website does not have to be elaborate, but you must have a professional-looking site that shows your practice, and your contact details. A map might be useful to ensure that potential patients can find you.
The costs of your marketing will probably be £10,000 or more in your first year, so you might look at an unsecured loan to provide them.
It is not something you can skimp on. Without marketing, you will have no patients - and without patients, your squat practice will not last long.
Tax is an issue for every new business. A large quarterly VAT or annual tax demand is inevitable if your business is doing well, and it can cause problems with your cash flow, particularly when it falls at the same time as other costs.
Tax loans help you to spread the cost of your tax demands into affordable monthly payments, helping ensure that your business does not have to go through a cash flow drought, and can help you avoid issues with HMRC and potential financial penalties.
Benefits of a tax loan include:
As a dental professional, there are many financial solutions that you can call on. But finding the most appropriate solution for your needs takes a thorough understanding of both of the lending market, and the products available on it.
At Rangewell we have the expertise you need. We know the lenders who can offer the most competitive rates for the dental profession, and we can help you find the most appropriate solution for your particular needs.
But not all lenders will offer the most competitive terms. Looking for the most competitive deal for your squat practice, and across the entire market, takes time and expertise - time which you probably don’t have. We know the lenders who can offer the most competitive rates for the dental profession, for all types of finance, including Professional Loans, Unsecured and Secured Loans, Invoice Finance, Asset Finance, Merchant Cash Advance, Commercial Mortgages, Growth Finance and more.
If you are looking at the finance you need to grow your dental practice, you need to look at the finance you need first. Get in touch to start this journey.
The funding you can find includes:
You can also find support for your dental business with business support for dentists, including financial advisors for dentists and sales and acquisitions for dentists.
Last update: 14 November 2022
Have a question?
A dental squat practice is a a start-up business, usually run as a single chair operation in a leased suites of rooms.
For many dentists, earning a salary as an associate is not enough. So although the prospect isn't an easy one, the alternative of starting and running a squat practice is an exciting one.
To start with, squat practices are essentially single surgery practices until they have enough patients to fill their second surgery. Some of the challenges facing small squat businesses include:
There should be some things to consider when applying for a loan:
Some dentists throughout their career quite happily as earning a salary as an associate. The idea to buy a practice rarely comes up, and they might not think about how to own a practice. For other dentists, opening up their own dental clinic is an exciting prospect. There are reasons for and against opening your own private practice, but there are some important things to think about.
On average, a dental practice in the UK can expect an annual turnover of around £500,00 with costs including:
Which will leave a yearly profit of £90,000.
Each every dental practice is different, so this should be considered as an average cost.
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