The dentistry industry – demand for dental work and its supply – is taking a positive bounce forward in spite of the pandemic, it seems.
Analysis carried out for Christie & Co – a legal and real estate specialist that monitors the healthcare sector – suggests that Britain’s dental industry has adapted well in order to pursue business operations through recent times.
Health insurance providers – and especially those with specific dental propositions – have been working hard to underline the value of what they offer, even as fewer people have been attending appointments during the crisis.
This week, Unum Dental made a broadly-welcomed move to ‘compensate’ scheme members for the fact that the pandemic has limited access to care.
In Christie & Co’s 2021 Business Outlook, researchers also quizzed frontline dental operators about their views on sentiment in the market, and how they feel about business operations in 2021.
Researchers found that the dental market is “generally feeling positive” about recovery in the year ahead, with two-thirds of respondents stating that they are “positive” or “fairly positive” as the market continues to return to normal trading conditions.
The majority feel it will take up to three years for the market to return to pre-COVID levels – but more than a third (37.5%) – are more optimistic that this will be within the year.
Despite the absence of a clear consensus on “price movements” for dental practices – a bellwether – for market demand, more than one in five (22.6%) of market participants say they are planning on acquiring a new business or some other assets.
The report also found that:
- Pre-COVID levels placed a heightened emphasis on oral health. Christie & Co expects this “reinvigorated appetite” to continue as independent buyers purchase their own practices
- Corporate buyers with ambitious buy and build targets will “make up for lost time”, and deal flow will increase “considerably”
- Corporate buyers will continue to bid aggressively for larger practices, and there will be renewed price inflation for better quality sites
- A greater supply of practices will come to the market from owners who put their exit plans on hold in 2020
- Much of the market “will continue to bounce back strongly”. However, price corrections will affect poorer quality businesses proportionately harder as they struggle to adapt financially
Paul Graham, head of dental at Christie & Co, said that in spite of the “unprecedented” challenges of 2020, the dental sector adjusted quickly to the shock of the pandemic and, whilst practices were closed during April and May, the profession bounced back “very strongly”.
Graham said: “The market remained remarkably resilient, with the majority of transactions put on hold rather than abandoned, and we’re optimistic that recovery will continue, and deals will successfully complete in greater volumes in 2021.”
The full report, ‘Business Outlook 2021: Review. Realign. Recover, is available here.