Interesting DSO statistics, trends you should know

2019 12 12 18 38 2614 Future Crystal Ball 400

If you don't keep a close eye on what happenings with direct service organizations (DSOs), you may be left behind.

That's why Connect the Dents and the Dental Sales Academy have studied and surveyed a cross-section of DSOs within the emerging and midmarket categories around the U.S. to keep you up to date on the latest trends.

Some of the patterns we've unearthed with the help of top executives and business development directors from more than 50 groups are surprising, exciting, and interesting.

For instance, 70% of DSOs are in the process of or planning to expand in at least one new state within the next 12 months. This requires some planning, but it doesn't take as long as it took in other years.

From start to finish, DSOs were able to acquire single location private practices in 7.5 months in 2018. For 2019, we are showing slightly lower numbers, with deals taking an average of 6.75 months.

In addition to expansions, some DSOs are shifting to operations that offer seven-day-a-week services. The overwhelming majority of the affiliates in these groups are open at least full days five days a week for patient care, approximately 6% are open seven days per week.

On another note, affiliate practices in these groups also are seeing increases in collections. Approximately 60% of them showed a spike in collections over the previous 12 months. In contrast, Connect the Dents, which does many practice evaluations and appraisals across the country, is seeing around 40% of private, independent, and non-DSO affiliate practices showing an increase in collections in the past 12 months.

Another standout trend is that about one-third of DSOs are changing their top leaders. About 35% of the DSOs we looked at changed CEOs or presidents during the past 12 months. Most surprisingly, about 50% of those new appointees came from healthcare, nondental backgrounds.

Finally, the majority of DSOs are keeping up with technology. In addition to prioritizing digital scanning and cloud-based software as high on their list, about 30% are interested in technology and programs related to sleep apnea. Teledentistry has caught the attention of about 25%.

DSOs are always evolving. It's important to know what's gaining momentum and what may be losing steam because affects everyone in the industry.

Stay tuned to find out what's trending with the approximately 30 largest, elite DSOs in the country.

Anthony Stefanou, DMD, CBI, is a dentist of 32 years (nonpracticing) and a certified business intermediary. He is the managing partner and founder of Connect the Dents, a dental mergers and acquisitions and business development advisory company working with manufacturers, dealers, DSOs/practices, and the Dental Sales Academy. He can be reached at [email protected].

The comments and observations expressed herein do not necessarily reflect the opinions of DrBicuspid.com, nor should they be construed as an endorsement or admonishment of any particular idea, vendor, or organization.

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