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Rise of DSOs in US Dental Services Space

Updated: Dec 15, 2021

The size of US Dental Services market in 2021 is expected to be around USD 145 billion. This makes it the largest dental services market globally in terms of dollar value. However, in terms of the number of dental treatments performed, Mainland China still leads the global rankings.

The rise of DSOs in the US dental services space is no secret. The country’s DSO segment is growing faster than overall market and adopting tech more quickly, ultimately driving growth. During FY 2020 and 2021, the segment grew +12 percent sequentially YoY.

In terms of dollar value, in 2021, DSOs actually represent ~15% of the total US dental market (vs. 8.8% of dental practitioners), demonstrating the value these entities bring to the market, whereby practitioners can more fully focus on delivering care to patients.

When it comes to building a competitive advantage, there are three specific areas that the DSOs need to focus on in terms of building sustainable long-term advantage:

1. Increasing Revenue from Existing Offices (Same stores sales growth).

2. Leveraging scalable infrastructure to improve operating margins (Cost Synergies)

3. Building de novo offices or Retails units growth (Retail units growth)

On the other hand, in terms of overcoming the challenges, there are significant staffing and recruitment challenges confronting DSOs as hygienists and dental assistance continue to be in high-demand. Likewise, the pandemic has negatively impacted margins – as costs associated with cleaning, disinfection, PPE and other hygiene costs have risen.

To find out more about DSOs rise in the US dental services market, please refer to our Research Report here (available for registered members only).

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