Smiles Dental’s business model good for patients & dentists

Longview-based firm has grown from 8 to 16 locations within the last year

Dr. Jeremy Dixson

Dr. Jeromy Dixson DMD, MBA is the CEO of Smiles Services LLC and president of Smiles Dental Group PC. Together, these two firms form a dentistry business model that has been highly successful – consistently doubling in size and revenue the last two years.

Increasing administrative paperwork, skyrocketing business costs and decreasing reimbursements plagues the traditional solo practitioner business model, said Dixson. He characterized the other end of the spectrum – “corporate” dentistry – as having “less personalization and mediocre quality.” In contrast with these business models, Smiles Dental is a “multi-location group practice.” Dixson said this model lets dentists focus on patient care while the management company handles administrative tasks.

“[Our model] takes the best of both worlds and fuses them into one package,” stated Dixson.

The company is based in Longview, with locations ranging from South Puget Sound to Southern Oregon, as well as Spokane and Anchorage. Four locations are in Clark County – Ridgefield, Hazel Dell, Camas and east Vancouver.

Dixson said that when he attended dental school in the Midwest, he saw that there was a huge growth of dental group practices in that area – half his class was hired by dental groups in 2004. Taking this to heart, Dixson started thinking about the long-term prospects of the dentistry profession.

“I thought about medicine and where it had gone with physicians consolidating into groups,” Dixson said. “I realized dentistry was heading the same way.”

However, he said, when he investigated dental groups in the Northwest, he said they were “falling short of putting patients first.”

“I felt there was room for a dental group that could take the best of traditional dentistry (service, professionalism, personalized care and relationships) plus the benefits of a dental group practice (economies of scale, sharing of best practices and quality control),” explained Dixson.

After graduating from dental school, Dixson returned to Southwest Washington and joined a practice with an office in Hazel Dell. By 2010, Dixson had bought out his partners, re-launching Smiles Dental with a new management structure, logo, website and mission/vision: “Ultimate Service, Superior Performance, Positive Impact.”

“Our mission doesn’t just hang on a wall,” Dixson said. “It’s six words and everyone knows it. It gives us a unity of purpose.”

This team approach, in addition to freeing Smiles Dental’s dentists from management tasks, is a key component of Dixson’s business model.

“I looked at why corporate dentistry did not live up to expectations,” said Dixson, “and I saw that doctor turnover is the primary driver of mediocre service quality.”

To ensure his multi-location dental group does not suffer from that problem, Dixson has created a proprietary pension plan, where the member dentists share in the profits of the practice in a vested, long-term program.

“They commit to us long-term – a 20-year career,” Dixson said. “In return we set up a pension plan that, at the end of the 20 years, enables the dentists to take from that pension what they would have gotten if they had had a solo practice and sold it.”

This sweat equity is attractive. Dixson said that the cost of dental school has tripled in the last ten years, banks are more reluctant to loan money, and several local practices have gone bankrupt in the last few years.

“The risks are getting greater, and dentists want long-term career options to cover that risk,” stated Dixson. He added that dental schools are guiding students now toward group practices instead of solo practices. Ten years ago, most dentists were planning on owning a private practice. A recent study shows less than 20 percent are taking that route today.

The financial results indicate that Dixson’s business model makes sense. In 2013, the firm had eight locations and $12 million in revenue. In the last year, the number of locations doubled to 16, with 2.5x the revenue. The firm, with 200-plus employees spread across both Smiles Dental and Smiles Services, has been on the Inc. 5000 list two years running (in 2014, #202 in healthcare overall and #56 in WA state).

Going forward, Dixson stated that Smiles Dental’s strategy is to continue to add a new office each month; he expects to add three more offices between now and the end of the year.

Although at first, Dixson said, he was focused on his own career and what was best long-term for him, his focus has shifted now to relieving dentists.

“I see a lot of them unhappy in the profession,” said Dixson “I’m trying to do something good for the profession that is an enduring improvement. I have a passion for the future of dentistry.

“We’ve seen the movie before, in medicine,” he added, “but let’s do it better for patients, staff and community. That’s what gets me out of bed on those hard days – really changing dentistry for the better.”

Jodie Gilmore’s journalistic background includes more than 15 years of writing for the Vancouver Business Journal as well as other publications such as Northwest Women’s Journal, North Bank Magazine, American Builders Quarterly and The New American. A Master’s in Technical & Professional Writing and 20+ years in the trenches as a technical writer and online help developer round out her writing background. When not writing, she enjoys gardening and working on her small farm in the Cascade foothills.