Thinking of Selling Your Dental Practice?

YHere's what to expect.

Selling your dental practice is a significant milestone, both financially and emotionally. This decision can profoundly impact your life, and the process can be a rollercoaster of emotions. Thorough preparation is vital for enhancing the value of your practice and achieving a successful sale.

The entire process of selling a practice is demanding from start to finish. While most sales conclude successfully, the journey can be rewarding or difficult. Although some factors are beyond your control, thorough preparation can lead to a better outcome.

Preparing your practice for sale should be a continuous effort, focusing on making it appealing to potential buyers. This preparation should ideally begin a year or two before the planned sale date.

Pay attention to aspects directly related to the operation and structure of your practice, such as the condition of your facilities, equipment, lease agreements, patient base, staff, and contracts. Additionally, ensure that your production and collections are optimized. Continuous preparation is essential, as your practice must be attractive to buyers and ready to answer all their questions during due diligence.

When your practice is ready to sell, reflect on whether you are emotionally prepared. Selling a practice is generally a stressful and emotional experience. Although many dentists are accustomed to high-stress situations and making quick decisions, they can easily experience frustration during the sale process.

The sale process is unfamiliar to many, as it may only happen once in a dentist's career. It involves intense negotiations, and input from a team of advisors, and is largely out of the dentist's control. Additionally, the legal and financial complexities often lead to timelines that extend beyond expectations. The thorough examination by buyers can feel like an invasion of privacy, as every aspect of the practice is scrutinized.

It's important to accept the complexity of the sale process once an offer is accepted. Stay strong and flexible, focus on the result, and depend on your advisors to ensure a successful outcome.

Once an offer is agreed upon, the buyer will start the due diligence process and pursue bank financing. Due diligence involves verifying data, identifying inconsistencies, and ensuring compliance. The information required can be extensive, including detailed practice reports, lease agreements, X-ray tests, compliance documentation, financial statements, contracts, expense breakdowns, procedure reviews, and more. This process can feel invasive, but it is necessary and should be approached with cooperation.

Another key element is the agreement formulated by the buyer's attorney. This document is typically revised multiple times as lawyers adjust the wording to meet their clients' needs. Depend on your attorney to protect your interests and ensure robust representation. However, be prepared to participate in negotiations and understand that the process may require flexibility. Direct communication with the buyer can sometimes resolve issues more effectively than legal negotiations.

In summary, you can influence the outcome and satisfaction level of your practice sale. Proper preparation well in advance, choosing the right buyer, and understanding the inherent challenges of the process can significantly reduce stress. By making balanced decisions, you can achieve a successful sale and transition.

Alan Rustom