6 Months to Stability: $50M Dental Practice Fixes Cash Flow & Fuels Expansion

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Background

A $50M multi-office dental practice with shared back-office systems had grown rapidly through acquisitions, but cash flow was tight despite healthy net income on paper. Struggling to pay bills, cover payroll, and service debt, leadership faced the reality that without fixing cash flow, they would lose the ability to borrow for future acquisitions.

Solutions

We identified & implemented the following strategies to improve cash flow:

 

  • Created a monthly scorecard benchmarking each practice’s performance to quickly identify and address underperformers.
  • Established a cash flow-to-debt service ratio and working capital target to maintain reserves and avoid liquidity crises.

  • Implemented “financial hygiene” practices that ensured sustainable operations and growth capacity.
  • Positioned the company to secure a warehouse line of credit, streamlining future acquisitions without individual bank underwriting.

Conclusion

By implementing clear financial benchmarks and practice-level performance tracking, this $50M dental group eliminated chronic cash flow struggles, secured flexible acquisition financing, and set the stage for accelerated growth — all within six months.

Solutions

Challenges

  • Net income misleading leadership into overlooking true cash position

  • Some practices highly profitable while others operated at a loss

  • Profitable practices subsidizing underperformers

  • No clear debt service or working capital benchmarks in place

Benefits

  • Cash flow stabilized in six months

  • Underperforming practices turned profitable

  • Warehouse line of credit secured for streamlined acquisitions

  • Eliminated monthly payroll and debt payment stress

  • Accelerated acquisition strategy with no individual practice bank underwriting

 

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