When selling a dental practice, there are two things you want to get right: the buyer and the price. To ensure that you’re successful in these two areas, you have to decide on the right time to sell. Waiting until you are forced to put your dental practice on the market means that you will be rushed into a decision – having a significant negative impact on the price and potential buyer pool.
Instead of selling your practice because you have to, you should sell your practice on your own terms in order to maximize your return on investment. Ideally, this would be when your business is still in the growth stage and you have time to wait for the right buyer/offer.
If you are considering putting your practice up for sale, ask yourself the following questions:
- Why do I want to sell my practice?
- What will I do after I sell?
- What will I do with the money from the sale?
- How much money can I expect to net after attorney, CPA, brokerage commissions and taxes have been taken out?
- How long do I plan (or need) to continue working in the dental practice following the sale?
In addition to answering these questions, you should also seek the advice of your tax advisor regarding possible tax implications from the practice sale; likewise, you should speak to a dental practice sales broker regarding the current market price of your practice as well as various tax-saving deal structures available to you.
A brief caveat: it’s not in your best interest to put your practice on the market just to “test the waters.” Not only does selling a practice require a great deal of your time and your business consultants’ time, but it could unnecessarily disrupt your staff and their sense of security. For this reason, you should be confident in your decision before initiating the sales process.
If you have determined that now is the right time to sell your practice, your first move should be to contact a professional dental practice broker that has experience in the extensive experience in the dental practice transition field. (If you are not sure if you need the advice of a professional broker, check out this article: “Do I Need a Dental Practice Broker?“) A professional practice broker can help you with every facet of the sales process, including:
- – Advising you on pricing and sale structure.
- – Preparing your marketing strategy.
- – Screening and qualifying buyers.
- – Educating buyers on dental practice transitions.
- – Keeping you updated on market reaction and buyer interest.
- – Presenting offers and pointing out their strengths and weaknesses.
- – Facilitating negotiations and structuring the deal.
When it comes time to sell, it’s important to keep managing your practice to make it as profitable as possible, while your practice sales broker forges the steps of your sale. This will provide you with peace of mind as well as ensure you select the right practice buyer and receive the best possible sales price.