Satellite Offices: Insight From the Inside by Dr. Kevin Baharvand

Satellite Offices: Insight From the Inside 

by Dr. Kevin Baharvand

Satellite offices present both challenges and opportunities. In this piece, I will share my personal experiences managing an orthodontic satellite office in a shared space with a general dentist—essentially having a practice within an independent practice.

What exactly characterizes a satellite office? Is it a secondary location, an extension of an existing setup, or perhaps a place where orthodontists and teams operate for fewer days than in a regular office? Although the precise definition remains flexible, I consider a satellite office, when complementing a flagship location, as a space where clinical work takes place for no more than one or two days a week. At Elate Orthodontics, we manage two fully equipped flagship offices and a streamlined satellite hub—a minimalist setup with necessary technology and a mobile team.

Finding the right practice location
A satellite office within a general dentist or pediatric dentist practice can serve as a cost-effective route to initiate an orthodontic venture. Shared fixed expenses create a mutually advantageous setup. This arrangement offers access to diverse demographics, potentially accelerating market share and revenues more rapidly than starting from scratch. We started our satellite office within a general dentist’s office by subleasing their entire space and equipment once a week, alternating on Mondays and Wednesdays.

The proximity of the satellite office to the main locations depends on your region. I live in Dallas–Forth Worth, where a few blocks in any direction can influence people’s orthodontist preferences. Our satellite office is a 10- to 15-minute drive from either of our flagship offices but in a vastly different community socioeconomically. Remember, in big cities, people have established driving habits; sometimes a highway or a major road can inhibit families from routinely seeking your service despite the relative mileage proximity. In rural areas, the satellite might be farther away, necessitating thoughtful staffing strategies.

Identifying the right partner
The growth stage of the general dentist’s or pediatric dentist’s office can directly affect your initial momentum if it intends to refer patients to you. A new practice might not provide the same referral potential as an established one. Keep this in mind, because sharing space with another provider is likely to affect your external referrals. External referrals are not a significant source of new patients for us, with less than 10% of new patients being referred by a dental professional. Therefore, in our experience, this has not been a major concern. But if you rely on external referrals, be prepared, because other dentists may not like their patients walking into another dental office, even if you’re just subleasing space.

Clear communication plays a vital role: Make sure patients know that even though you share a space, your practices are separate businesses. Aligning how you take care of patients and how things work between the practices creates a good team spirit, which is especially helpful when aspects such as marketing and insurance are similar. You can attract people who are a good fit for both your practices if you both target the same demographics and participate in the same insurance plans, and can save on marketing by coordinating your marketing calendars.

In our case, our practices had vastly different ways of taking care of patients, and we focused on different groups of people. We overcommunicated with our patients about how we’re separate practices. However, despite all the effort, be prepared for some surprises: We had patients who didn’t want to fill out new-patient forms because they’d already done it at the other office, and some people called us unhappy about their time at the other office, thinking we were the same. Trust me, this kind of mix-up will keep happening, so you need to train your team well to guide your patients when they’re confused.

Common challenges and solutions
Regarding the contract arrangements, a direct sublease agreement with the managing dentist’s office is straightforward, but not all leases permit subletting. While profit-sharing might be enticing, it is often illegal and can lead to complications. Legal advice should be sought to protect your interests. Here are a few recommendations for negotiations that helped us retrospectively:
  • Exclusivity. Secure exclusive rights to provide orthodontic services during—and, if possible, beyond—the agreement period. This safeguards the reputation you build and the patient base you establish. You are establishing goodwill within that practice. You must be consulted and rewarded if such goodwill is to be sold in the future.
  • Space etiquette. Allocate exclusive usage on your scheduled days to prevent conflicts, particularly among team members. Determine storage arrangements for your instruments and equipment when you aren’t present.
  • Exterior signage. Seek permission for exterior signage when feasible—a tool to attract new patients.
  • Equipment usage. Clearly outline equipment usage and repair procedures to avoid misunderstandings.
  • Sublease renewal. Ensure renewal options are in place for seamless continuity.
  • Practice and equipment conditions. Define expectations for the practice and the equipment’s condition on your scheduled days to ensure a smooth transition.

Based on our experiences, here are a few common issues and their solutions:
  • Unsanitary or disorganized space. This is probably the most common issue we have faced. Communicate your expectations regarding space conditions with the other doctor or practice manager. This is especially significant when the other practice experiences
  • Intrusion by other practice’s staff. It’s advisable to refrain from allowing this, because it can disrupt your team’s focus on patient care. We even had a manager solicit our team members! Your guess is right: We addressed it with the other doctor immediately and forbade her from being at the practice when we were there.
  • Equipment breakdown. If essential equipment breaks down, remind the other team about the agreed-upon list of equipment and conditions that must be available to you on your days. This is a significant issue, too: There is a difference between a broken autoclave and a broken pano machine. An autoclave is as crucial to them as it is to you; rest assured, it will be fixed quickly. On the other hand, most general dentists do not utilize their pano as frequently as you may, and their repair is costly. Unless agreed upon in advance, it may take a while for it to be repaired. In our case, issues with the pano machine were never fully addressed. We had many consultations rescheduled at the flagship offices to have access to working X-rays.

Financial considerations
Now, you might be wondering what constitutes a fair price for a day’s sublet at a practice. The answer depends on the location of the practice. Arrangements vary, from a fixed amount like $400–$500 per day for the entire office or a specific number of chairs, to a percentage of the current lease—for instance, one-fifth (given one sublet day out of five working days) of 120% of the lease price for once-a-week use. I suggest having a fixed monetary amount for the entire office and equipment free of any of their staff per day, with options to increase if needed.

Satellite offices within other practices are multifaceted ventures. It may take time for staff to adjust to the arrangement, and shared spaces and equipment can present challenges. They enhance revenue and market share while keeping expenses manageable. Our satellite office has increased both our income and expenses. Income, however, has risen at a faster rate, which has been great for the overall margins. So, is a satellite office a wise choice? It’s not a simple decision. It’s a dynamic journey, with both challenges and rewards, guided by the principles you had originally agreed upon.

Author Bio
Dr. Kevon Baharvand Dr. Kevin Baharvand is the founder of White Glove Orthodontist (WGO) and the owner and orthodontist at Elate Orthodontics in Dallas–Fort Worth. In collaboration with other dental groups, Baharvand has successfully initiated multiple orthodontic startups, overseeing every detail. His diverse background—including clinical acumen, a master’s degree in organizational leadership and an active Texas real estate license—serves as the foundation of WGO. Baharvand’s mission is to make startup consulting more comprehensive, fostering the independence of orthodontic practices while ensuring affordability.

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