Dental Practice Broker Articles
What NAPB Can Do for Your Dental Practice
By Brannon Moncrief of McLerran & Associates
FACT: A dental practice is typically the doctor’s most valuable and prized possession.
FACT: A dentist will typically sell a dental practice only once during his or her professional career.
Considering these facts, it’s not surprising that many dentists entrust the responsibility of selling their practices to a professional who has the knowledge and experience to facilitate a successful transition … a member of the National Association of Practice Brokers. In my experience, these dentists typically receive a higher value for their practices, have a more amicable relationship with their buyers following the sale, and experience much less stress and anxiety during the closing process than their counterparts who try the “do it yourself” approach.
Selling a dental practice is not like selling a vehicle… it is a complicated process which extends far beyond simply finding a buyer and closing on the sale. While some practice owners may be able to identify a buyer who is interested in purchasing their practice with little difficulty, getting from that point to the closing table is the most challenging component of a dental practice sale. Determining the market value of the practice, finding the right buyer, negotiating the purchase price, drafting the asset purchase agreement, formulating the transition plan, negotiating the lease assignment, and obtaining practice financing are just a few of the key areas where a potential practice sale can be derailed and the experience, expertise, and guidance of a dental practice broker can prove to be invaluable.
Doctors who are preparing to sell a dental practice often ask us what our role in the process will entail. Here are the primary responsibilities of an NAPB dental practice broker:
- Identify and accomplish the seller’s goals for the transition – Every doctor and practice is unique so it is imperative for the dental practice broker to spend the time to understand the seller’s individual situation and goals and formulate a dental transition strategy to meet their needs.
- Solely represent the dental practice seller’s best interest during the transition process. Beware of practice brokers who offer “dual representation”, as it is impossible to represent the best interests of both the buyer and seller simultaneously.
- Complete an expert dental practice valuation to determine a fair market value for the practice, maximize the value the seller receives at closing, and be able to support and articulate the value to interested buyers and their advisors.
- Construct a detailed marketing profile and cash flow analysis for the seller’s practice, including all pertinent information that potential buyers and their advisors will need in order to evaluate the office.
- Confidentially market the practice to qualified buyers and advertise the practice on a local, state, and national level via the web, print ads, seminars, trade shows, etc. It is critical that all potential buyers are required to sign a Confidentiality Agreement prior to receiving any information on the seller’s practice.
- Handle all inquiries from potential buyers regarding the practice, including conversations, email correspondence, and showing the office after business hours.
- Dental practice brokers serve as a buffer between the buyer and seller throughout the process (particularly during price and contract negotiations) to preserve the goodwill of the practice and relationship between the parties.
- Provide draft contracts including the Letter of Intent and Asset Purchase Agreement.
- Assist the buyer with securing practice financing.
As you can see, dental practice brokers play a vital role in the dental practice transition process. When it’s time to start planning the sale of your practice, an NAPB dental practice broker can save time, increase value and eliminate unnecessary stress. Please contact us for a free dental practice transition consultation.
|Dental Practice Transitions||Selling a Dental Practice|
|Dental Practice Valuation||Dental Practices For Sale|