A Three-Phase Plan for your Dental Practice Transition

My brother is a huge planner, but my spouse is incredibly spontaneous; this sometimes makes the agenda for a family reunion downright comical. Yet as I have gotten older, I have come to appreciate my brother’s thoroughness when thinking about the future. When we arrive, we have a tee time or we have a reservation and we get to try the latest chef’s culinary treats.

In the former example, the stakes are relatively low. When you are envisioning a dental practice transition, many doctors only start taking the appropriate steps after it is too late. Perhaps, you already have begun to transition, working half days on Fridays or spending a month away in the summer. Unfortunately, enjoying these deserved perks without having taken the required steps to best protect your capital and maximize your revenue when you sell your dental practice is dangerous because the stakes are much higher. Having a plan in place and taking steps in an intentional order makes for an easier dental practice transition.

Phase One: Schedule your Dental Practice Transition

The first phase is a good time to get out your calendar. I spent some time in Texas and in an ideal world, you want to be there in March or October; but if at all possible, you want to avoid 100-degree-days-at-a time weather in August. Timing your dental practice transition relies on the same principle. You want to start the process of selling your dental practice about two to five years prior to retirement. This provides time to find a buyer, and leaves room for a period of time when you’re still active in the practice (perhaps just to a lesser degree). Again, we’re aiming for the sweet spot when the practice is still flourishing.

Phase Two: Value your Practice

A dental practice valuation is the linchpin of phase two. Acquiring a clear view of the practice is integral to knowing how and when to best sell your dental practice. At this point, an NAPB dental practice broker is your guide within phase two. Reach out to friends and professional associates to find a dental practice broker verses in appraisals. If you’re not quite ready to sell, a dental practice valuation may seem premature. That’s not necessarily the case. Often, a dental broker is also willing to update the dental practice appraisal later so it’s a win-win—you get a sense of what you could receive if you sell today, and you can make improvements and take actions to increase the price before you actually sell your dental practice.

Phase Three: Selling your Dental Practice

You created a timeline, have a clear sense of value in the practice, and now it’s time to sell. During this phase, your dental practice broker is vital because it’s time to find the appropriate buyer. Having taken the time to plan and value your practice will really pay off when you sell your dental practice.

NAPB | National Association of Practice BrokersDENTAL PRACTICE BROKERS

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


Perfect Timing for your Dental Practice Transition

When should you start planning to sell your practice? Remarkably, many dentists wait too long before taking initial steps toward a productive dental practice transition. Many doctors operate under the false assumption that when you sell your dental practice, you must be ready to retire. That’s not always the case. In fact, starting to think about and taking action towards a dental practice transition between five and seven years pre-retirement ultimately often facilitates a much more relaxed transition.

How do you know when it’s time to sell your dental practice? When a doctor comes to me contemplating a dental practice transition, as an NAPB dental practice broker, the first thing I do is inquire about the current state of the practice.

First of all, how are you feeling about the day-to-day realities of running your own practice? Are you energized when working with your staff or are you tired of handling their schedules and administrative responsibilities? Are you excited about cultivating new patients and employing new technologies and treatments, or does a day at the office leave you feeling frustrated and fatigued?

Most dentists who are ready to sell have the following in common:
NAPB dental practice transitions Perfect Timing for your Dental Practice Transition

  • They are ready to cultivate other interests and pursuits outside of dentistry.
  • They feel the clock is ticking as far as aging and they want to prioritize their health, reduce stress, and enjoy more of their days.
  • They want to disperse the obligation of income. In other words, they are no longer interested in taking time off and having the practice stop making money.
  • They are considering relocation and/or full retirement.
  • They no longer want to be a manager—overseeing their staff, the financials, and even acting as a liaison with insurance and government agencies.

If you’re not ready to retire, but you do want to share some of the responsibilities of the practice, selling a share of your dental practice to a partner or partners and continuing to work in a lesser capacity can also provide a strategic move in the right direction. In this type of agreement, you gain the benefit of cashing in (to some degree), and you can still participate in the parts of dentistry that you enjoy.

This approach may offer you the opportunity to mentor a new dentist or partner with an experienced dentist and increase the value of your practice while, most importantly, letting go of the more tedious tasks that were taking away from your job satisfaction. By working in a part-time capacity, you may also find that when you are at the office, you are more engaged and inspired that when working full time and being accountable for every aspect of the business.

To summarize, if you are considering selling your dental practice, it’s a good time to sit down with a dental practice specialist to initiate a time line and prioritize your next steps. Please call an NAPB dental practice broker for a free consultation today.

NAPB | National Association of Practice BrokersDENTAL PRACTICE BROKERS

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