Recurring vs Fee-for-Service Models
Recurring revenue models command premium valuations. Understanding the differences helps buyers assess practice value.
Model Comparison
| Factor | Recurring (Ortho) | Fee-for-Service |
|---|---|---|
| Cash Flow Predictability | High | Variable |
| Valuation Multiple | 7x-10x EBITDA | 4x-6x EBITDA |
| Patient Commitment | Contractual | Discretionary |
| Revenue Stability | High | Lower |
Recurring Revenue Benefits
- Predictable cash flow
- Higher valuations
- Patient retention
- Planning confidence
Fee-for-Service Benefits
- Flexibility
- No contract administration
- Immediate payment
- Service variety
Conclusion
Recurring revenue practices offer stability and premium valuations. Fee-for-service provides flexibility. Both models can succeed with proper management.
Model analysis? Contact DentalBridge.