April 6, 2018

The 7 Essential Dental Practice Transitions Explained

By now, you’ve probably already decided that selling your practice is the best option, whether it’s for retirement or managerial purposes. But maybe you don’t know or haven’t started exploring all your options yet. Here, we break down the types of dental practice transitions in an effort to help you figure out which is best for you and your business.

Buy-out

A buy-out is exactly what it sounds like: when a purchaser buys your practice for a negotiated price. A relatively short transition period that typically only lasts three months is ideal for a prospective retiree. The seller may agree to stay on part-time to help ease the transition for the buyer, employees and patients.

Buy-in

A buy-in is the opposite of a buy-out in which a specific buyer purchases a defined portion of the practice for a negotiated amount determined at the outset. In this case, a professional dental practice broker will also perform a personality profile to ensure compatibility, in addition to a practice analysis.

Associate to buy-in

Here, a potential buyer is courted by a group of associates to buy-in over a defined period of time, road-mapping the ease of transition. Rather than making decisions about the future of the practice upfront, this allows time to assess compatibility; however, the division of power is the biggest consideration to make.

Associateship

A good idea in theory because associates are easy to find, and this route allows you to maintain full control over the transition; however, associateships are typically only 20% effective due to not everything being agreed upon from the outset and different expectations not being met by both parties.

Merger

Combining two dental practices to become one entity with equal partnership remains a tried-and-true method as long as compatibility is established upfront and responsibilities and income are equally divided and agreed upon.

Roll-up

This option is one that pays off in the future under the economies-of-scale principle: Multiple dental practices are purchased over a period of time to combine into one entity, which will then sell for a higher value at a later date.

Affiliation

The slowest of the transition options, this option hands over the majority of the practice to a larger entity, typically a dental service organization (DSO) or a group, with the purpose of slowly transitioning out of your practice to and giving up clinical control to the buyer.

What’s next?

Read more about your options in our e-book “Strategies for Transition,” then reach out to the experts at Professional Transition Strategies to figure out which makes the most sense for you and the future of your practice.

January 15, 2018

How Do I Sell My Colorado Dental Practice?

Whether you are ready to sell for a personal reason or you want to transition the practice to a partner, you are probably feeling a little overwhelmed by the thought of selling your Colorado dental practice. After all, this is arguably one of the most important financial decisions of your life. Here is a list of steps involved in the process and some helpful tips to get you started on the path to a dental practice transition.

Identify your goal

First, you must identify what you are trying to achieve and what is most important to you. Do you need to sell by a specific date? Is your ultimate goal to maximize your financial return? Or is the most important thing finding a buyer who will retain your staff? While sometimes you will need to compromise, it’s important to know what you won’t negotiate on.

Talk to experts

A considerable amount of thought needs to be put into your efforts of selling your dental practice. Fortunately, you don’t have to take on the challenge alone. The best way to sell a dental practice is to work with an experienced transition broker. Not only can they help increase the probability of a lucrative transition, but they will also decrease the possibility of post-transfer litigation. At the end of the day, an expert will be on your side to address your specific concerns and guide you through the process.

Determine the value of your practice

One of the first things you will do with your transaction broker is conduct a comprehensive practice appraisal. This will determine what your practice is worth and tell you how to maintain its value until you are ready to sell. At Professional Transition Strategies (PTS), we use the most effective way of calculating your practice’s worth by looking at certain factors and their impact on the business. Some of these factors include the location of the practice, growth potential, long-term trends and reason for sale.

Review your options

There are several types of dental practice transitions. Here are just a couple of your options:

Buy-out: This is when the purchaser buys your dental practice for a negotiated price with a relatively short transitionary period. This is the quickest and easiest transition type.
Buy-in: This is when a specific buyer purchases a defined portion of the practice for a negotiated amount from day one. In addition to a practice analysis, PTS will perform a personality profile to ensure compatibility. It’s a long-term approach that can expand your practice’s value.

Merger: This is when two existing dental practices combine to become one entity and operate normally as equal partners moving forward. This is an option that allows net income to stay the same or even improve because there is no loss of business.

What’s next?

If you are still wondering “How do I sell my Colorado dental practice?” contact us today.

July 10, 2017

Is Now the Right Time to Sell Your Dental Practice? Key Signs

“Should I sell my dental practice?” This is a question most practice owners come across at some point in their careers. Considering selling your practice can be stressful, especially if you don’t have all of the information you need. At Professional Transition Strategies (PTS), we are here to provide you with that information and guide you through your transition. Here are some common questions asked and answered. Continue reading “Is Now the Right Time to Sell Your Dental Practice? Key Signs”

June 20, 2017

The 7 Essential Dental Practice Transitions Explained

If you’ve decided you are ready for the next step of your life and dental practice, it may be time to consider retirement. There are many different kinds of transitions, so regardless of whether you are ready to completely stop working, we can help you find a transition that works best for you and your dental practice. Here are a few different transition options.
Continue reading “The 7 Essential Dental Practice Transitions Explained”

June 20, 2017

What You Need to Know About Dental Practice Transitions

Transitioning a dental practice is an intricate process and can seem overwhelming if you are approaching or going through the process. Not only does transitioning a dental practice include financial challenges, but emotional and relational ones, as well. We at Professional Transition Strategies (PTS) can help you navigate this process because we have been through it before. We realize every situation is unique, but we also recognize there are many steps to go through to successfully transition a practice. Here’s an outline to get you started. Continue reading “What You Need to Know About Dental Practice Transitions”