Dental practice funding: chairs, imaging, fit-outs and growth

A dental practice is one of the most equipment-intensive small businesses in Australia. Each surgery needs a chair, delivery unit, lights, suction, imaging and sterilisation, and patients increasingly expect modern technology such as digital scanners and 3D imaging. Fit-outs must meet strict infection control requirements. Growing a practice means adding surgeries and dentists, each a significant investment. With steady patient income, dental practices are well placed to fund that growth sensibly.

How money moves in a dental practice

Patients typically pay on the day, with health fund claims processed on the spot or soon after. Some treatment is paid in stages or through payment plans. Costs include dentist and hygienist remuneration, nurses and reception, lab fees, consumables, rent, equipment finance and software. Most practices have a relatively short cash cycle and steady deposits, which makes them straightforward for cash flow lenders to read.

Why dental practices seek funding

The most common reasons include replacing or adding dental chairs, buying imaging equipment such as OPG or CBCT units and intraoral scanners, fitting out a new surgery, refreshing the reception and patient areas, upgrading sterilisation, buying into or purchasing a practice, opening a second location and funding a new associate’s ramp-up.

Funding options for dental practices

Equipment finance suits chairs, imaging and other long-life clinical equipment. See equipment funding.

Unsecured loans suit fit-outs, mixed equipment packages and growth projects, assessed on the practice’s trading. See unsecured business loans.

Property-secured loans from $20k to $5m suit larger projects such as practice purchases or major refurbishments. See secured business loans.

Lines of credit suit timing gaps and the ramp-up of new associates. See business line of credit.

Planning a new surgery or equipment upgrade? Get the conversation started. Enquiring is not a credit check.

What an assessor checks in a dental file

When a dental practice’s statements reach an assessor, they look for regular patient and health fund deposits, lab fees and consumables in line with activity, remuneration and rent, existing equipment finance and any dishonours. Practices usually present well. A short explanation of the number of surgeries, dentists and the purpose of the funding helps an assessor quickly understand the request.

Equipment decisions

Dental equipment is expensive and long-lived. Fund it over its working life, consider service and warranty terms, and estimate the extra appointments or treatments it enables. Imaging equipment, for example, can bring in work that was previously referred out. Tax treatment of equipment, including depreciation and any instant asset write-off, should be discussed with your accountant before purchase.

Adding surgeries and associates

A new surgery takes time to fill, and a new associate takes time to build a patient base. Plan for several months of lower utilisation and fund the ramp-up rather than expecting the new surgery to pay its way immediately. The break-even calculator can show how many appointments each surgery needs per week.

Infection control and compliance

Dental fit-outs must meet infection control and accreditation requirements, which affect sterilisation areas, surfaces, plumbing and air handling. Engage designers and builders experienced in dental fit-outs, include compliance costs in your budget and allow time for approvals. Our page on fit-out and renovation funding covers budgeting and contingencies.

Buying into or purchasing a practice

Many dentists move from associate to owner by buying into an existing practice or purchasing one outright. These transactions involve valuing goodwill, equipment and the patient base, reviewing the lease and understanding the outgoing owner’s role during the transition. Lenders will look at the practice’s trading history, the purchase price, your own experience and how the purchase is structured. Larger purchases often suit property-secured lending. Get accounting and legal advice early, and have the practice’s figures and lease ready when you enquire.

Patient finance and payment plans

Offering payment plans for larger treatments can increase case acceptance, but it also means the practice waits longer for some income. If you run in-house plans, factor the delay into cash flow planning. Third-party patient finance providers pay the practice upfront but charge fees. Either way, knowing how much income is deferred helps you plan funding for equipment and growth.

An illustrative example

An illustrative three-chair suburban practice wants to add a fourth surgery and an intraoral scanner to reduce lab remakes and impress patients. The equipment package and fit-out are quoted together. The practice funds the chair and scanner through equipment finance and the building works through an unsecured loan over three years, timing the work for the quieter January period.

Invest in your practice

If you run a dental practice and need funding for equipment, a new surgery, a fit-out or growth, tell us about your practice and the investment. There is no credit check to enquire, your details are not shared with an array of lenders, and an actual human goes through it. Accurate details help us structure funding for each part of the project. Apply now.