How to build a flagship practice with your SMSF
When a Queensland orthodontist found the property for the practice of his dreams, he built it with the help of his SMSF and BOQ Specialist.Learn More
“When I graduated as a dentist I was bonded to the Queensland government and I ended up being the flying dentist in the Gulf of Carpentaria in Queensland,” says Dr Kent Farmer. “It was really just extractions and more extractions.”
After the required two-year period, he chose orthodontics as his specialisation. “Had I started in private practice, I might have taken longer to get to orthodontics, so specialising from the beginning allowed me to be the youngest orthodontist to graduate.”
Dr Marcus Tod, a friend from university, also chose orthodontics and graduated a few years after Dr Farmer, who by then was in a group practice in Queensland.
“In 1990, Kent bought into the practice, and I bought into it in 1994 and by the year 2000 it was just Kent and myself. That’s when we corporatised,” says Dr Tod.
“The branding has been really important; we wanted to take the focus away from individuals—Kent and myself—and we wanted that corporate culture, but a caring corporate culture. We thought under the umbrella of ‘Ethos’ we could get that.”
Dr Farmer believes being likeminded, and the same age, is what got things moving as Ethos Orthodontics. Thanks to continued growth of their practice over the years Ethos Orthodontics has become the largest provider of orthodontics in Queensland, with practices in multiple locations.
An opportunity to enter the Chinese market emerged during a staff meeting with associate orthodontist Anna Chang.
“Basically, through a complex web of family relationships we had access to a licence in China, which is really hard to get,” explains
Dr Tod. “In China, we’re in partnership with Anna Chang, so it’s a separate entity to Ethos; we call it Ethos World.”
Establishing a practice in China required resilience and perseverance. Dr Farmer points out that the process of setting up a branch practice in Brisbane took four months.
“In comparison, China was four years, so that indicates how long it took to negotiate around the regulations, the laws, and the licensing.”
The expansion process proved financially complicated, but the angst set in when the big banks backed right off. “We were a sure bet, as it were. You couldn’t get a surer bet, and it was very frustrating to find out that a big bank was so conservative. It was really nice to have Jeff Miller from BOQ Specialist there to say, ‘Yes, we can do that.’”
“We didn’t want to put any pressure on the business here, but at the same time we were offered two practices in Brisbane,” explains Dr Tod. “We wanted to purchase and renovate the practices, and BOQ Specialist helped fund this while we put our own funds into China.”
This meant using personal finances to purchase the best equipment—before they got the licence, emphasises Dr Farmer. “You can imagine that we were holding our breath there for a while.”
Queensland Premier Anastacia Palaszczuk opened the Shanghai clinic in April of last year. While their marketing initially targeted expats, Dr Farmer says instead it’s the local Chinese people embracing Ethos World. “I think they see an Australian practice as being the upper level of sterilisation, technology and technique.”
Dr Tod describes China as an amazing country. “The energy there is unbelievable and there is an extraordinary amount of wealth with the rising middle class. They’re articulate, they speak English and they want to look good.”
Overall Dr Farmer sees the Shanghai clinic as an ambitious and audacious move. “Who would have thought we’d have a practice in China? But it’s been great, I’m glad we did it.”
For the future, Dr Tod says the immediate focus is on consolidating current locations to make sure they’re fully utilised. “Virtual dentistry is on the rise, and recently Jeff helped us purchase four 3D scanners for mouths.” With nine locations to equip, that means five more to come. “They are the cost of a small luxury car. I see the equipment sitting in the corner and think, I could be driving that.”
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