Consider the Triad (Emotional, Practical, Financial) when Selling a Dental Practice, Part 2

You’re thinking about selling your dental practice. Maybe you think that you’re ready to put it on the market in a matter of months, or maybe this is something that you’re planning to do a few years from now.

There are a lot of moving parts, if you will, when contemplating a dental practice transition. As we discussed last time, you need all three parts of the triad—emotional, practical, and financial—working together for a fruitful dental practice transition. While the practice may be financially sound, you may not be emotionally ready to let go of it. Perhaps there are some practical upgrades necessary before you want to schedule a dental practice appraisal.

The following few pre-sale questions should help you evaluate where you are in the process:

  1. What are your goals when selling your dental practice? Answers to this question will certainly determine the timing of next steps. Maybe the practice is ready for market or maybe there are some practical and financial steps to take before you can present it to potential buyers. Emotionally, do you feel ready to work fewer hours or enter into a partnership or retire entirely? What exactly do you want to accomplish with the sale?
  2. What is the dental practice valuation? This requires a collation of financial documents, staffing roster, current infrastructure, building/land details, and related specifics about the practice to determine the fair market value. I often find an NAPB dental practice broker essential during this step in order to get a clear picture of the dental practice appraisal to date.
  3. What is the current dental practice landscape? In other words, is it a good time to sell? Are there prospective buyers in the market for a practice like mine? If not, what do I need to do to make my practice more desirable? Will I be able to achieve my goals at this time? When you put your dental practice on the market, it’s like sending out an invitation to a party filled with lawyers, accountants, financial statements, cash flow analysis, term sheets, and the like. There is potentially a great deal of money changing hands so emotions can run high.

Are you ready—emotionally, practically, and financially? It is tough on everyone if you head down the path towards selling a dental practice without a clear vision of your desired outcome. I have seen a number of instances where the seller backed out at the last minute, and that affects all partied involved. Luckily, it can also be avoided with the help of an NAPB dental practice broker.

In a perfect scenario, you want to receive the highest return on your investment with the least interruption to the practice and your daily life. You also want to feel like the practice is in good hands moving forward. Finally, you want to be subtle about advertising the sale of your practice because the worth is in a highly-functioning, money-making practice. That’s why some forethought and planning is so advantageous. With clarity about the triad, you greatly improve the possibility of a successful dental practice transition.

Please get in touch. We are happy to have a free consultation to help you gauge where you are in the process for your dental practice transition.


NAPB | National Association of Practice BrokersDENTAL PRACTICE BROKERS

Dental Practice Transitions Selling a Dental Practice
Dental Practice Valuation Dental Practices For Sale

> MORE

Consider the Triad (Emotional, Practical, Financial) when Selling a Dental Practice, Part 1

For many doctors, being a dentist is your life’s work. It has been your livelihood, and it has provided a rewarding and satisfying career. When you come to the point when you’re considering selling your dental practice, it can be difficult to set aside the emotional attachment to the joy of the work and be objective about the realities of what is often your most valuable possession.

It’s important to assess the practical and financial components as you embark on a dental practice transition. I have found that this is best done with the help of an NAPB dental practice broker.

There are a number of ways to approach a dental practice transition. Every seller is unique so it’s important to get clear about your objectives. Ask yourself the following practical and financial questions:

  1. Are you planning to retire when you sell your dental practice or will you continue working in the practice?
  2. Are there any changes that need to be made as far as staffing to make the practice run more efficiently (and perhaps ensure a higher dental practice valuation/appraisal)?
  3. What percentage of your overall net worth depends on the dental practice appraisal?
  4. Have you thought about the tax implications when selling your dental practice?

For most doctors, you’re not thinking about the specifics of a dental practice transition until you are ready to move into the next phase of life. Dental practice transitions are as varied as the dentists who embark on them. Some doctors are ready to sell their dental practice at age sixty and retire entirely, while other dentists are well into their seventies and still seeing patients (albeit perhaps these doctors are working fewer hours per week).

Did you know that 6 out of 10 dental practices are forced to simply close up shop? You’ve spent so much time and energy building up a practice; it seems a shame (and emotionally this is the most difficult scenario for the doctor, their staff, and their patients). When you are ready to sell your practice, I want to help you get clarity about how you can do so and walk away maximizing your emotional, practical, and financial return.

NAPB dental transitions strategies Consider the Triad (Emotional, Practical, Financial) when Selling a Dental PracticeAs I mentioned before, sometimes a doctor plans to sell their practice more than once. We always tease my father that it has taken him three “attempts” before he actually retired. Fifteen years ago, practically and financially, it made sense for him to bring in a partner, selling half the dental practice, growing the practice for another ten years, and then selling the entire practice at the end of that decade. In my father’s case, the larger financial payoff came during the second sale, but there was a huge practical and emotional payoff by being in business with another dentist and cultivating their staff and practice style together during that time. He then consulted with practices for a few years before he completely retired.

75% of your dental practice value is measured by intangible metrics. Unlike a vehicle, where a prospective buyer can literally kick the tires, it’s impossible to guarantee that patients will continue to come to your practice. This is where a dental practice broker is your finest partner. Also, unsurprisingly, selling a dental practice can be an emotional experience. From your perspective, the books are in the black, you’re booked up a month in advance; it’s obvious that the practice is flourishing and profitable.

NAPB brokers have handled over 1000 successful dental practice transitions and an NAPB broker is integral when considering a dental practice transition. A reputable dental practice transition consultant can act as a vital translator and important mediator to keep all parties emotionally, practically and financially on track.

Please reach out and talk to a dental practice transition consultant today. We can help you consider your next steps.


NAPB | National Association of Practice BrokersDENTAL PRACTICE BROKERS

Dental Practice Transitions Selling a Dental Practice
Dental Practice Valuation Dental Practices For Sale

> MORE