Preparing Your Dental Practice to Sell
Whether you are approaching retirement age or just thinking about a transition, there are several things you can do to prepare your practice for sale. Doing these things may help eliminate headaches, increase your sales price, or reduce your costs. Here are a few tips:
- Assess your equipment. Upgraded practices sell faster. If you are more than five years away from retirement, I recommend a few upgrades such as digital x-rays, recovering your chairs if needed, and freshening up the paint. If you’re closer than five years, you will not get the tax benefit of major upgrades, so stick to the paint and carpet.
- Clean up your accounts receivable. Reimburse patient credits, collect old accounts and keep the A/R current.
- If you have an associate, make sure you have an associate agreement with a non-compete.
- If you have an employment agreement with your corporation and you are a C-Corporation, you may need to terminate yourself a few years before retiring. Consult your tax accountant.
- Consult your financial advisor and tax accountant. How much do you need to retire? How much do you have? What are the tax consequences?
- Get a practice valuation to see what proceeds you will get from the sale.
- Be realistic about the time it takes to sell. In remote areas, it can take a year or two. Metro areas, much less.
- Keep your production up as you near retirement. I see dentists slow down all the time in their last few years. Work the same number of days.
- Assess your staff. Do you have too many staff? Do you have one that should have been let go seven years ago?
- Have a practice assessment performed by a qualified consultant. Many will do it for free or for a small fee. This may help show you some areas to improve over the next few years.
By focusing on these items in the coming years as you near retirement, you will avoid having your practice production and thus the price of your practice go down in your later years. Call me for a free consultation. I would be happy to take a look at your practice and give you my thoughts. Or, if you are thinking about transition right now, I have a database of buyers looking in your area.
Dentist Office Sale – A Sellers Perspective
So you want to sell or transition out of your office. What can you expect? There’s a big difference out there between expectations and reality. When I do dentist office transitions or sales in Washington or Oregon, the selling dentist sometimes likes to work back. That’s a great thought and I’ve seen it work. But, more often than not, I’ve seen a disgruntled buyer, disgruntled seller, or both.
What often happens in a dentist office transition where the seller works back, is that the staff still views the selling dentist as the boss. What he says still goes. The selling dentist oftentimes still views himself as the managing dentist or at least the expert in running a practice. That may or may not be the case. The buying dentist is left as the outsider looking in.
So, what do you do to have a successful dental office sale or transition? Communication is the key. The sooner and more often the two sides get together the better. If the buyer is envisioning the practice being run one way and the seller thinks things will continue as usual, there’s going to be a problem. Everyone needs to be on the same page as to how staff management is going to happen, how marketing will happen, who gets the new patients, etc., After that’s done, get the attorneys together and put it in writing. If everyone communicates upfront and everything’s in writing and agreed to, you’ll have a better chance of having a happy ending.
Call us for a free consultation on how to make sure your dental office transition or sale is a happy one. 877-866-6053
Read MoreWhat often happens in a dentist office transition where the seller works back, is that the staff still views the selling dentist as the boss. What he says still goes. The selling dentist oftentimes still views himself as the managing dentist or at least the expert in running a practice. That may or may not be the case. The buying dentist is left as the outsider looking in.
So, what do you do to have a successful dental office sale or transition? Communication is the key. The sooner and more often the two sides get together the better. If the buyer is envisioning the practice being run one way and the seller thinks things will continue as usual, there’s going to be a problem. Everyone needs to be on the same page as to how staff management is going to happen, how marketing will happen, who gets the new patients, etc., After that’s done, get the attorneys together and put it in writing. If everyone communicates upfront and everything’s in writing and agreed to, you’ll have a better chance of having a happy ending.
Call us for a free consultation on how to make sure your dental office transition or sale is a happy one. 877-866-6053