At REP, we strive to provide valuable information to business owners throughout the greater Arkansas area. Over the past several weeks, we interviewed dental practitioners in Arkansas to identify any common strengths and struggles they’ve felt since the onset of the pandemic. We found that prices are on the rise for many and that key economic factors will influence the future of the practice.

     As lifted mandates and available vaccines show signs of improving the present economic scenario, we examine the current challenges being faced by dental practices. Many lead practitioners are optimistic about the future of their practices, but they acknowledge the difficulties that have been triggered by the pandemic. One of the major obstacles that multiple practices identified is the difficulties of insurance, both for  practices and for patients. With outdated price allotments to patients and rising costs of coverage for practices, there is definitely room for policy improvement regarding dental care. This is going to be a particularly poignant concern for practices as the nation inches its way out of lockdown. Dr. Wiggins, of Fiana Family Dental, points out that the $1,000 given to patients for dental care was a price set in 1965 when one could also buy a new car for $5,000. Insurance companies have failed to keep with the times as prices and overhead have increased. It would also seem that, in addition to new challenges, the pandemic exacerbated pre-existing ones. Dr. Isaac Le, of Regional Dental Care, provides the insight that although every practice is different and managing the office is always a challenge, it seems that, due to the pandemic, these challenges have been more tangible in the last year. Several patients missed appointments and services as a result of the unforeseen shutdown, and, in addition to all of this, prices for basic PPE (Personal Protection Equipment) have increased drastically. Many, including Dr. Wiggins, Dr. Hurst of Hurst Family Dentistry, and Dr. Daniel Jones of Dental Health of Fianna, have pointed out that the price of even a box of gloves has skyrocketed during the pandemic. 

      Despite these challenges, however, many practitioners have an optimistic 2-5 year outlook. They have high hopes for the future of their practices and dentistry as a whole as the pandemic loosens its grip and more dentists graduate and take to the field.  Several dentists in the Greater Arkansas area report plans for growth in the near future and believe there will be an upswing as more patients begin returning at more normal intervals. It appears that the worst may have passed and that a return to relative normalcy should provide stability in the near future. 

      Perhaps unsurprisingly, many doctors across the board acknowledge the relatively high rate of consolidation across Arkansas, and Fort Smith, in particular. Several mentioned that, for many practices, consolidation can be a good avenue. Dr. Kendall Roberts of New Health Dental states, “It’s a matter of making the right decision at the right time.” Many practices may be simultaneously looking at brand new challenges as well as the opportunity for a raised value in their practice as the economy moves to regulate in the wake of the pandemic. If consolidation continues to follow the pattern it has in the world of dentistry, then we can certainly expect to see more in the future.

     Finally, in light of the challenges and commonalities we found in our research, we believe there will be barriers new practices will have to take into consideration, and that the frontier of dental practices is bound to experience even more changes as the nation slowly reopens. Dr. Charles Ligget points out that it is difficult for incoming and graduating dentists to begin practices when they are burdened by increasingly large amounts of student debt, and that it can be difficult to start your own practice. This will likely lead to either a notable upturn in present value for successful practices paired with a pointed increase in difficulties for new/struggling practices as economic policies and price shifts continue to shake the waters of dentistry. But, as many of the doctors who contributed to this article have noted, the outlook is still bright for the practices of the Greater Arkansas Area and there is a light at the end of the tunnel.       

    We would like to thank all the dentists and practices that contributed to the research for this article and for taking the time to share their experience and expertise with the REP team to help make this report possible. We look forward to continuing to provide value to business owners in Arkansas.

If you have any inquiries or questions regarding your own company’s future or valuation, please give us a call at 479-784-9522 or visit our website at www.ResolutionEP.com .

- Alexander Michael - Resolution Equity Partners - Jr. Analyst