Dallas-based Smile Doctors, an orthodontics-focused DSO, is one of the largest dental organizations in the U.S., entering 2024 with more than 415 practices.
J. Hedrick, the company's CEO, connected with Becker's to discuss the company's aim for the rest of the year and their goals for 2024.
Editor's note: Responses were lightly edited for clarity and length.
Question: How has the organization grown so far in 2023, and what does a successful end of year look like?
J. Hedrick: We've added about 40 practices this year and are north of 415 in total. We have had a good year of adding great practices. The market is a little bit interesting this year with rising interest rates and consumer behavior that is a little unpredictable right now. No one knows what is going to happen, which makes everyone a little skittish. For the end of year, it continues to be the focus of partnering with new doctors. We have a handful of deals that we would like to get completed in 2023 and we want to start off 2024 strong as well. We live and die less by a calendar year and are more about keeping a cycle. I think for the last 20 quarters, we have closed deals every single quarter. It's not like we do a big push at the end of the year and then there is a big gap in January. For us, it's about partnering with great doctors who are culturally aligned that want to grow and provide a great patient experience. It's not rocket science, it's about refining a process that is working now and continuing to make it better so we can be more and more successful as we move into the future.
Q: What are the company's goals for 2024 and beyond?
JH: We have two or three new states that we are looking at; none of them are far enough along where I would say we have some letters of intent there. We like to move into new states where we know we have enough scale to be able to support those practices at a high level. We don't often go into a new state with just one practice, and if we do that practice tends to be a large practice and we have a belief we can put other practices around it. When we look at new state entry, we're very open to it, but we want to make sure we are delivering on the promises we are making. We're also less worried about going into new states because the market is still significantly fragmented. We don't grow by geography, we grow within concentric circles around our doctors. If we partner with a great partner, he or she knows a handful of other great doctors. If they're in Texas that's great, if they're in Utah that's great, if they're in Idaho, a state that we are not in right now, let's talk about it and see if it makes sense. We remain most worried about the cultural alignment and the quality and focus on patient care way more than putting three new states on the board.