UK dental market ripe for further consolidation

further consolidation of dental market predictedA highly fragmented dental market is helping to drive growth in the UK, with only 12% of practices owned by corporates.

Clearwater International’s latest report shows there were 14,150 dental practices in the UK in 2018, but only 11,965 dental companies.

It is predicting further consolidation this year as companies take advantage of the opportunity to grow rapidly.

‘The dental market is ripe for significant consolidation from larger players,’ Ramesh Jassal, director and international head of healthcare at Clearwater International, said.

‘For larger businesses the benefits are clear.

‘Such acquisitions help them develop and strengthen their brands.

‘It also helps achieve economies of scale through increased buying power and back office synergies.’

Cosmetic dentistry

Clearwater International is expecting spending on dentistry to grow by 4.1% every year until 2020.

The report predicts cosmetic dentistry, the fastest growing segment with an average growth rate of 5.2% per annum, will drive growth over the next few years.

It expects this segment to be worth £3.3 billion annually by 2022, with celebrities and influencers helping to drive this.

‘For all these consolidators a crucial point is that they are taking a ‘mixed economy’ approach to the sector, namely looking for practices which serve both NHS patients and people prepared to pay privately for treatment,’ Mr Jassal continued.

‘In the UK dental market subsidised patient groups, such as the under 18s and those on low incomes, provide a recurring revenue stream for practices.

‘But the private dental market is growing strongly too.

‘This is driven by increasing interest in personal health and wellbeing, mounting awareness of oral hygiene across all ages, and by a fast-growing cosmetic dentistry sector.’

Ageing population

Favourable demographics will also help grow the dentistry sector in the coming years, the report says.

The government expects the over-60s population to increase by 11% over the next five years.

Clearwater International’s report expects demand from those in their later life to help drive growth in the dental market.

‘An ageing population drives growth in the private dental market,’ Mr Jassal said.

‘With the over-60s population in the UK forecast to increase by 11% to 17.8 million over the next five years.

‘In particular, the increased demand for dental services in later life boosts the dental market.

‘It tends to lead to more recurring treatment such as remedial and restorative work.’

Future problems with dental market

Future problems that might hinder growth are the NHS dental contract and Brexit, the report shows.

It claims the overall impact of NHS dentistry moving towards a capitation model is not yet fully known.

And Brexit could impact on the number of dentists coming from the European Economic Area practising in the UK.

‘Sixteen per cent of dentists practising in the UK have qualified in the European Economic Area (EEA),’ Mr Jassal concluded.

A recent survey found almost a third of EEA-qualified dentists were considering leaving the UK in the next few years.

‘The reformed NHS dental contract is also a cause for uncertainty.

‘Uncertainty may drive some dentists towards provision of private services at the expense of the NHS.

‘The latter point only further substantiates the rationale for investors pursuing a mixed economy model across the sector.’


Download the Clearwater International report here.

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