How to Talk to DSOs – All 31 Flavors of Them

Written by Roshan Parikh

If you’re a vendor reaching out to DSOs, do you ever find yourself double checking that your sales team emailed the right addresses?

When you see that the recipients’ addresses were, indeed, spelled correctly, do you start to wonder if there was something so off in your sales approach that the recipients instantly junked your messages?

Is that how aggressively you get ignored, even though you thought you did everything right—from quantifying the market opportunity, to segmenting your sales team, to dividing and conquering based on the number of practices a DSO currently has?

There’s bad news, and there’s good news.

Bad news first: your pitch probably didn’t seem relevant.

The good news is that with a more sophisticated messaging framework, you will fix that, and the DSOs who’ve been ghosting you will start showing interest.

Every DSO is Different

Consider a DSO that just laid off their entire Business Development team or went to market to recapitalize and had a failed sale process. Are they an “actionable” target for the next new digital scanner rollout, for a new phone system, or honestly, to buy anything? Probably not. And if you’re reaching out to them, it’s no wonder they aren’t answering your messages.

Now imagine that you contacted a different DSO with the following value proposition: “We can help you get to 8% same-store sales growth organically with implementation of our product/technology.” But they have a successful de novo strategy and are growing at 12% YoY. Why would they listen?

Sell Smarter, Not Harder

How can we prospect smarter? How can we be more cognizant of what type of DSO we’re talking to, and then reprioritize our sales funnel accordingly? Or, better yet, create a multi-pronged set of value propositions for different DSOs?

What’s missing is a better segmentation methodology that takes into account key inputs about our audience, including each DSO’s corporate ownership structure, current financial performance, and size—in other words, a new taxonomy for classifying DSOs.

From all of my time as a DSO leader, combined with the daily conversations I have now with DSOs, investment bankers, healthcare accountants, vendors, and manufacturers, I’ve developed my own proprietary segmentation methodology.

It’s fluid, changing quarterly, if not faster, and it gets significantly more detailed than what I can share here. But what follows is a high-level outline, so you can start approaching the problem in the same way I do—and improving your outcomes.

Founder-Led vs. PE-Backed DSOs

The first thing I look for is whether a founder or a PE firm owns the group.

Founder-owned and -run DSOs are typically more willing to listen and agile to implement, whereas PE-backed DSOs are much more methodical and complex. PE-backed DSOs typically have a set protocol for how new hardware and software is introduced and vetted, which can be more complicated for vendors and manufacturers to deal with.

The Three DSO Growth Modes

Regardless of whether DSOs are led by founders or PE firms, I divide them into three growth modes.

1. Full Speed Ahead:  Inorganically, a Full Speed Ahead DSO is “on plan.” They’re either building de novos, buying dental practices and groups, or both. Organically, they’re creating value via consistent same-store sales growth. If they acquire a dental practice today, it’s safe to say they’ll grow the topline revenue 8-10% year over year and increase EBITDA margins. Full Speed Ahead DSOs, whether founder-owned or PE-backed, are what we want to be when we grow up.

2. Same-Store Sales: These groups aren’t building or buying anything. Instead, they’re intensely focused internally on same-store sales. In the example above, this is the type of DSO that might have just laid off their entire Business Development team.

3. In Trouble: These DSOs are either on the brink of insolvency or already there.  They could be lender owned or day-to-day cash. They aren’t paying all of their vendors on time.

If you’re trying to sell into an In Trouble DSO, you might as well have the wrong email address.

Targeting Full Speed Ahead and Same-Store Sales groups is the best path. But the value propositions for each should be different. “We can help you get to 8% SSS organically with implementation of our product/technology” might fall flat for a Full Speed Ahead. But that same value prop could be met with open eyes and ears if you’re talking to a Same-Store Sales.

Emerging, Mid-Sized, and Elite DSOs

Just as important as a DSO’s growth stage is its size. I use the Henry Schein numerical nomenclature most of us are already familiar with.

The bigger the DSO, the bigger the sales opportunity. Mid-Sized and Elite DSOs are the shiniest prizes.

But don’t write off Emerging groups. Their recipes might not have all of the ingredients and be fully baked yet. They may be more willing to try something new than a more established player—especially when you factor in their leadership and growth stage.

And that’s how each of these categories start to come together.

When discussing emerging, mid-sized, and elite DSO concepts, it’s crucial to consider the organizational hierarchy and structure unique to each. This significantly influences how one should approach selling to each DSO type. For instance, in an emerging DSO, there might not be specialized roles like compliance or equipment management, potentially making procurement the decision-maker. The challenge here is that procurement personnel may not fully grasp the value of your product, given it’s not within their daily scope. On the positive side, they might lack an existing tool or process, making the sale somewhat easier.

On the other hand, larger DSOs are likely to have dedicated professionals and established tools in place. For example, a mid-sized DSO might have the necessary support staff to enforce product adoption or assign someone to own the project, impacting decision timelines. Understanding these dynamics is essential for tailoring your sales approach effectively based on the DSO’s size and organizational structure.

A Better Segmentation

Any given DSO is going to check a box in each of the categories we’ve covered.

For instance, a DSO could be Founder-Owned, Same-Store Sales, and Elite. Or it could be PE-Backed, Full Speed Ahead, and Emerging.

Whatever its classification, you should be using each of these pieces of information to tailor your messaging.

The Right Messaging Matrix

Consider each of the scenarios above: Do you have a value prop customized to a DSO in each of these audience buckets? Or are you using the same sales deck across the board? Even if you have a few versions based on the size of the DSO, do you have 18? That’s what I’m recommending.

For the best chances of success, you need to meet your prospective clients where they are. If you do, they’ll answer your emails. If you don’t, they won’t. You wouldn’t either if someone was selling you something with a pitch designed for somebody else.

Let’s go further. If you think your sales team isn’t doing a good job, ask yourself: Do they actually have the tools they need to make an impact in such a complex and constantly evolving landscape?

A dentist wouldn’t drill a cavity with a jackhammer, and you shouldn’t use a big, blunt sales tool when what’s called for is precision and sophistication.

To work with Dr. Ro and the DSO Strategy team
on leveling up your messaging framework,
reach out to

Dr. Ro is the Founder and Chief Strategy Officer of DSO Strategy, LLC. He previously served as Head of Dentistry for Walmart, U.S. and was the Founder of Great Lakes Dental Partners. He has been practicing dentistry for 16 years.