Is it time to transition your dental practice? The word “transition” doesn’t really do justice to the flood of emotions you may experience when it’s time to turn over your practice to someone else. After all, you’ve spent years working hard, staying late, and going the extra mile for your patients. It can be difficult to entrust your practice to another dentist (no matter how qualified), knowing they’ll make changes and your office won’t ever be run the same way again.
But don’t forget that this time of your life is when you can start enjoying all the fruits of your labors! After years of toiling away, you can now reap the benefits by sitting back and letting someone else take charge. Though you may feel worried about certain aspects of the dental transition, at ddsmatch Four States, we do everything we can to make selling a dental practice as stress-free and smooth as possible.
When you have a professional team of experts at your side and plans in place for every contingency, you can have a straightforward, hassle-free experience. Here are a few key components to keep in mind for an easier, clear-cut dental practice transition.
Determine Your Objectives
As the seller, you need to figure out what your ultimate goals are for this dental practice transition. How do you want to go about selling your practice? Obviously you’ll want to consider the sale price, but you also need to think about which situation would work best for you:
- You sell outright to another dentist who will pay you cash for the full amount and take over immediately.
- You work with an associate who puts money into the practice over a period of time until you and they are ready for them to take charge (this is called a buy-in)
- After selling the practice, you help make the transition more seamless by staying on for a few weeks or months after the sale.
It’s important to consider all your options, because you want to make sure you and the buyer are on the same page. You don’t want to have any regrets about selling a dental practice when the time is right, and you deserve to have the kind of practice transition that allows you peace of mind for the future.
If you are still figuring out what your goals are, talk to trusted family members and friends to help determine the kind of transition scenario that would fit your practice and lifestyle. Often a trusted confidant can put things into perspective and help you analyze the situation from different angles. It’s also a great idea to reach out to other doctors who have already gone through the transition process and ask them what they were happy about and what they would like to do over if they could. Talking through your goals will help you discover the best route for you, your staff, and your practice overall.
Assemble Your Team of Experts
As a dentist, you’re the expert when it comes to people’s teeth, but that doesn’t mean you’re knowledgeable about all facets of a dental practice transition. It’s imperative that you have an experienced team of advisers you can consult when you have questions before, during, and after the transition. Here’s who should be included on that team:
A Dental Attorney
It’s possible that when you started your practice, you consulted with a dental attorney to make sure you were in compliance with all laws and regulations when it came to dentistry in general. There were most likely a lot of contractual agreements that had to be drawn up and patient forms required for a legally sound practice. Now that it’s time for your dental practice transition, a dental attorney is a necessity once again. They know the ins and outs of dental practice transitions and can help you sift through the legal jargon you’ll encounter when turning over your practice to someone else. A qualified dental attorney won’t have to spend time researching all the specifics about selling a dental practice because they’ll already know them. This will not only save you money, but it will ensure that you’re legally protected when you finish the sale.
A Dental CPA
Just like you wouldn’t let a random acquaintance do your taxes for you, you don’t want just a general CPA looking at your books. A dental CPA is a necessity, not only because they understand the tax implications of a practice sale, but they also have the knowledge required to look at your accounts and records and tell you what those numbers reflect. They can inform you about ways you might be able to cut costs and how to truly evaluate what your dental practice is worth. A skilled dental CPA knows how to generate reports that determine the financial well-being of the practice and can verify that the money is being handled properly. Without a dental CPA to run the numbers for you, you could lose thousands with the sale of your practice.
A Dental Broker (Or Transition Specialist)
You shouldn’t have to handle all the details of such an involved business deal by yourself. A transition specialist is an immense help in this area. At ddsmatch Four States, we have the experience and knowledge you need to complete a successful dental practice transition. We’re considered transition specialists because we’ve helped hundreds of dentists in the Kansas, Western Missouri, Arkansas, and Oklahoma areas make favorable transitions. We’ll walk you through each step of the process so you won’t feel overwhelmed or confused as the sale progresses.
Why Expertise Matters
With a strong team of experts on your side, you’ll be able to complete an advantageous business deal that makes the most sense for you, your staff, and your practice. Don’t try to cut corners by handling all the details alone. You’re way too busy for that. Trust in your advisors so you can come out on top.
Planning Ahead When Selling a Dental Practice
Many doctors don’t know exactly when they want to retire. The current economic situation has made it difficult to predict what the future will look like. Some dentists are postponing their retirement, while others are calling it quits earlier than they originally planned. Though the pandemic has changed things, dental practices are still being bought and sold. If you think you might want to retire, keep in mind that it’s never “too soon” to begin thinking about your plans for the future. Most advisers recommend having your practice assessed for transition when you are about five years away from selling the practice.
What’s Included in Your Assessment
Your dental broker should be able to give you an idea of the value of your practice as it is right now. They should also advise you on what changes you should make prior to selling, and which changes are really not worth it. Remember that if you’re planning to pick the buy-in scenario where you have an associate join your practice, you will need to include him or her on the details of the changes and discuss them to make sure they are on board. It would be a bad idea to rip up all the flooring of your office and replace it with something else, only to have your associate change it again a year later once you’ve left. That’s just wasted money that could be going to something else in the practice.
If it’s getting close to the transition, it’s probably not the time to make a huge investment in new equipment. You won’t be able to get back the money from that investment before you leave. Some doctors who are looking to buy a dental practice won’t want to use antiquated equipment, so if you haven’t upgraded to digital yet, you may want to. Again, your broker will be able to advise you on the best changes to make prior to the transition.
At ddsmatch Four States, we partner with the professionals at Blue & Co. to provide complete valuation analyses. This is done twice. The first time will be when you are beginning the process (thinking about retiring), and the second time the valuation will be performed when you are ready to actually start your practice transition and move on to our Trusted Transition Process™. By completing this process two times, you can be sure you’ll receive an accurate assessment of the true value of the practice.
Select a Transition Date and Stick to It
When selling a home, you pick a closing date. When selling a dental practice, you also need to pick a “closing date”, or when you want the dental practice transaction to be complete by. It is absolutely vital that you pick a date and stick to it. With so many different details to negotiate such as financial, legal, real estate, etc. it can be easy to stall or postpone the transition. Just keep in mind that being in a state of constant limbo can be stressful and upsetting for both the seller and the buyer, and things can turn ugly fast.
When you pick a firm closing date and don’t allow things to get sidetracked, everyone ends up happier. In real estate, this is known as the “time is of the essence” clause, where if a party fails to meet the deadline, the deal is off.
At ddsmatch Four States, we know you’ve poured your heart and soul into your practice, and we also know that no two dental practice transitions are the same. The different elements involved include the personalities of the buyer and seller, where the practice is located, the timing of the transition, etc. Each of the four states: Kansas, Western Missouri, Arkansas, and Oklahoma are going to deal with different factors within the dental practice transitions.
For example, in Kansas there are currently 762 General Dentistry Practices, whereas Oklahoma has just over 1,000. There are about a million more people living in the state of Oklahoma than Kansas, so the competition for selling a dental practice in Oklahoma may be more fierce, but you may also have a lot more buyers interested. On the other hand, many young dentists looking to buy a dental practice may like the idea of beginning in a smaller, less populated Kansas town, so your dental practice may appeal to them for those reasons.
Sometimes no matter how firm your closing date and how badly you’re ready to sell, and no matter how many interested buyers you have, delay is unavoidable. Buyers don’t come through at the last minute due to financial reasons. Your office has to suddenly undergo structural repairs. You have a family emergency that puts you out of commission for a month. Anything can happen! Bottom line: stay as firm as you can on your closing date, and be flexible when necessary.
Selling a Dental Practice is Easier with the Experts at ddsmatch Four States
At ddsmatch Four States we want to be your dental practice transition specialists. Dictionary.com defines a “specialist” as: a person who devotes himself or herself to one subject or to one particular branch of a subject or pursuit. Your team at ddsmatch Four States has earned the reputation of specialists because we are devoted to ensuring your dental practice transition is smooth and stress-free. We bring the experience of hundreds of transitions from all over the United States.
If you are thinking about selling your dental practice in the Kansas, Western Missouri, Arkansas, or Oklahoma areas, we want you to trust our wide-ranging expertise. Our Practice Optimizer Experience helps Dentists like you plan and prepare for a future, and our Trusted Transition Process™ ensures that you, your patients, and your staff will be well taken care of throughout the entirety of the transition. We understand how hard it is to end part one of your successful career journey and begin the next chapter in your life, and we want to match you with a buyer who can continue your life’s work in a way that will make you proud.
We promise to guide you through the transition process while also helping you to avoid common, costly mistakes. If you are considering a transition in the next five years, give us a call today for a free, no-obligation Practice Transition Assessment.