January 19, 2018
Step-by-Step Guide to Dental Practice Transitions in Texas
If you are thinking about selling your Texas dental practice, you are probably feeling a little overwhelmed by where to start. After all, this is arguably one of the biggest financial decisions of your life. Here is a step-by-step guide to dental practice transitions in Texas.
Be ready to transition
Your first step is to determine your goals for the sale and what is most important to you. Start by answering the following questions: Why are you considering selling your dental practice? Would it be enough money to retire? Do you need to sell by a specific date? Is it important to maximize your financial return? Or is the most important thing to find a buyer who will keep your staff? Ultimately, your transition goal(s) will steer the transition plan, so identifying the goals of the future sale will help you structure a clearly defined transition path.
Find a consultant
A considerable amount of time and thought needs to be put into dental practice transactions. We have talked to numerous dentists who “read a couple of articles and have a good understanding of the process” and want to do the sale on their own to save money. It is important to get advice from experienced transition brokers and loop them in all of your decisions and discussions pertaining to the sale. Not only can they help you increase the probability of a lucrative transaction, but it’s just nice to have experts on your side to guide you through the process.
Obtain a professional practice valuation
Now that you have transition experts to work with and a goal and transition plan, it is time to determine what your practice is worth. The valuation you obtain should be completed by a broker that understands dentistry and the current marketplace for dental practice sales. At Professional Transition Strategies (PTS), we use the most effective way of calculating the value of your practice by looking at factors like location, growth potential and long-term growth trends.
Structure your ideal transaction
By obtaining the valuation of your practice, you can now determine if you are happy with the value placed on your office. If you are unhappy with it, one option is to work a couple more years to make up the difference. If you are happy with the value, you need to figure out if you want to leave as soon as the practice is sold or if you would like to work as an associate post-sale. But these aren’t your only options. We recommend talking with your transaction broker to find the best fit for your situation.
Market the practice
Once you have your valuation, plan and structure in place, you need to get people looking at your practice. Just like anything, the more people hear about your practice, the better chance you have at selling it. This is where your broker comes in. Practice brokers usually have a great pipeline to sell.
Show the practice to potential buyers
Once you have people interested in buying your practice, you need to get those potential buyers to the bank to see if they qualify for a loan. This way, you aren’t wasting your time and effort showing your office to individuals who can’t get a loan.
Receive offers and negotiations
Once you get an offer, you can accept the terms, counteroffer and begin negotiations, or decline the offer. Each option has different consequences and messages you and your transaction team will have to think through before making any quick decisions.
If you still have questions on dental practice transitions in Texas, contact us.