Should I Sell My Dental Practice?
The 3 Most Important Factors
Author: Aparna Pawar
Senior Practice Growth Consultant
Are you considering retirement? Maybe even selling your dental practice? Both? There are a multitude of reasons why you may find yourself asking these types of questions. Here are the Top 3 things to consider before you put your practice on the market!
Evaluate & Elevate Your Practice
For many dental professionals, their dental practice is their life's work. They've invested countless hours into building it up and making it successful. But what happens when it's time to retire? How can you describe your practice’s worth to another dental professional? Working with the right dental broker, accountant, and lawyer is a must. Be sure to hire professionals to help you get an accurate evaluation of your practice and its value.
This process alone can cost you hundreds if you haven't done your research, and don't have the confidence that you’ve chosen the right professional support. Ask the dental practice brokers different ways to further elevate the practice. Get their help in finding the right buyer, and take advantage of their skillset to guarantee a smooth closing. Having the broker make recommendations on small changes within the practice can actually make a huge difference in the sale.
There are many quick and easy updates you can make to the interior, such as new furniture, paint, new signage and light fixtures, etc. First impressions matter, and when a potential buyer walks into the practice they should be able to visualize themselves and their patients in that space.
Marketing Marketing Marketing
Working with the right marketing company can help you increase the number of new patient consults, and improve the overall production. When you are ready to begin selling the practice, the potential buyer and their team are looking at the statistics - how many active clients do you have at the practice, and how many of them are new? I hear dentists make statements like these all the time:
“I am retiring, and I want to slow down or maybe even stop my marketing.”
This always surprises me, because as a practice growth consultant I would certainly recommend the exact opposite approach. Having a social media presence, having an updated current website with domain authority, a Google presence with both organic and paid ads, and a strong referral program is a must for any buyer to see.
Know Your Practice: Understanding The Numbers
When you are ready to sell, understanding your own practice well is a must. It’s not enough to drive clients through the door and see production, knowing your own overhead, salaries, AR/ AP, lab cost, loans and leases are all very important. Revisit the organization chart and see if you need all of your current team members. Can you consolidate some of the job responsibilities to cut down overheads and show more profit?
Also, make sure that you, as the dentist, and your associate if you have one, are continuing to work hard and accept new patients. I see many dentists cut their working hours and decline accepting new patients. As a Senior Practice Growth Consultant, I highly discourage this type of behavior. In fact, this is the exact opposite of what you want, even if you’re trying to sell the practice. This affects their sale price since they have the potential to make a multiple of 5 to 6 times on the EBITA ( Earnings before Interest, tax, and amortization). Make sure that your practice has had solid profit and business for at least two to three years before selling off.
So, you're thinking of retiring. That's a big decision - and it's one that requires careful planning. You want to make sure that you're doing everything possible to ensure a smooth transition for both you and your patients. One important step is to find the right marketing partner who can help carry on the legacy of your practice. At Progressive Dental Marketing, we understand the importance of making this process as easy as possible for our clients. We'll work with you every step of the way to create a marketing plan that meets your unique needs and helps you reach your retirement goals. Contact us today to learn more about how we can help!
Are You Looking For A Partner To Take Your Sales Team To The Next Level?
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