August 25, 2021Practice Management
5 Things to Consider Before Selling Your Dental Practice
Building a dental practice from the ground-up is a dream for most dentists. But whether you want to move on to a new location, enter a new specialization, or just retire and enjoy the fruits of your labor, there may come a time when you need to sell your practice. In this blog, Tooth & Coin will take a look at a few things that you should keep in mind before you sell your practice.
1. Visualize How You Want To Transition Out Of The Practice
In a perfect world, how would you leave your practice? Think about your ideal timeline, your preferred exit strategy, and what you want to do next. Establishing this first means that you’ll have a clear vision of how you want things to go.
This is very important if you’re hiring a dentist to be your successor and buy your practice. Knowing your transition timeline and goals helps keep things moving in the right direction, and minimizes micro-management.
2. Start Planning In Advance Of The Sale
As soon as you know you want to sell, start planning. The longer you have to plan the transition, the better. For example, if you know you want to retire in 10 years, start planning right now!
The longer you have to plan your exit and transition your practice to a successor, the better. You won’t just have to toss them the keys and walk out! You can make your successor a real part of the team, and let them grow with you until they’re ready to take over and carry on your legacy.
This provides plenty of transition time for patients, too. They’ll get to know your successor, and will be more likely to continue coming to your office. The same may not be true if you only give your successor a few months to get familiar with your practice before selling it to them.
3. Take An Honest Look At Your Business & How It’s Doing (And Consider Hiring A Pro)
Now is a great time to look at the overall health and financial health of your dental practice. A rigorous self-appraisal is necessary before you sell it. Is the building big enough? Does your dental equipment need to be upgraded? Are you pleased with your staff and dental team? How are the finances of the business looking?
It can be hard to get an honest opinion of your practice on your own. Naturally, you’ll be a bit biased. So you may want to hire an outside company like Tooth & Coin, particularly when it comes to sorting out your finances. This will make it easier to understand exactly what your business is worth, and will help your successor take over your practice more smoothly.
4. Work To Find A Successor Who Aligns With Your Values, Interests, And Goals
The best thing about planning in advance is that you can find a successor who is perfect for taking over your dental practice. You don’t just have to sell your office to the first dentist who waves a check in front of you.
So take your time when looking for a successor. Find a dentist who you feel good about partnering with, and who will continue to provide excellent care for your patients after you transition out of the business. Make sure they understand your philosophy, what’s important to you, and what you expect from them as they work with you to take over your practice.
5. Implement, Execute, And Stick With Your Exit Plan
No waffling. Once the wheels are in motion and you’ve determined how you’re going to leave, stick with your initial exit plan. Whether you’re moving to a new practice, retiring, or want to continue working part-time after your successor buys your practice, don’t go back on your word.
On a related note, make sure you work with experienced lawyers, accounting specialists, and other professionals to streamline the transition to your successor. It doesn't pay to cut corners, and working with pros means there are less likely to be messy complications related to your departure from your practice.
Need Help With Your Exit Plan? Contact Tooth & Coin Today!
At Tooth & Coin, Jonathan VanHorn and our team specialize in dental accounting and finance. As experienced dental CPAs, we’ve handled numerous retirements, practice sales, and related projects for dentists nationwide. So don’t wait. Contact us online or give us a call at (877) 265-2121 to get the assistance you need.