Dentistry is booming, with almost 200,000 dentists employed in the industry in 2018. If you’re one of those practicing dentists, now may be the time to buy a dental practice of your own or to expand your current dental practice if you’re already a practice owner. Buying a dental practice is a huge investment of both time and money. Before making any decisions, it’s essential to be totally prepared to make a purchase. From clarifying your career goals to laying out your budget, there is a lot of preparation that needs to be done in advance. Henry Schein Professional Practice Transitions (Henry Schein PPT) consultants have the expertise and tools to ensure your acquisition is a smart one and that the process goes smoothly. With this advice, buying a dental practice will be smooth sailing.
Your career goals are probably the most important thing to keep in mind. Our Henry Schein PPT consultants know the importance of this firsthand—they are all either dentists themselves or have specialized knowledge and experience in practice transition. They have the know-how to help you ask yourself the important questions that will help you clarify your long-term goals. You cannot get there if you don’t know where you are going. The practice you purchase should be a step toward achieving your goals.
Establish what you want
Before you can start your search, first establish exactly what you’re in the market for. Identify what you need in a practice and what are needs versus wants. Consider these specifications of what you want in a practice carefully. They should range from broad generalities to specifics—at the end of the day, what matters is that your top priorities are met.
You need to know this up front, before you start your search. When it comes to financials, create a detailed budget that will ensure you don’t bite off more than you can chew. Knowing your budget ahead of time will allow you to look at practices with a plan, rather than feeling lost and confused about what you might spend. You don’t want to find the practice of your dreams only to discover it’s outside of your price range and that it’s not something you can afford.
There are many considerations for your practice, especially if you already own one or more practices. How far from each other should the practices be? Too close, you will just be moving business from one site to the other. Too far, and it’s like you are starting all over again without the benefit of word-of-mouth referrals. Take advantage of intelligence like Henry Schein Demographic Site Analysis Reports which provide socio-economic data and growth patterns of the type of business in the area. They can help you determine if there is enough opportunity in the proposed area to have it make financial sense. Our listings can help you get an idea of what’s currently on the market, so you can see if any locations would be a great fit with your personal preferences.
Ask the right questions
Once you’ve narrowed down exactly what you’re looking for and you’ve started to look at practices, it’s time to start speaking with sellers. This is the perfect time to determine if a practice is truly is a good fit. There are many important areas to explore, such as a practice’s work culture, the type of clients attracted, and the number of new patients. If you want to be on the cutting edge of technology, figure out what equipment and technology they currently use and how up to date they are. Henry Schein PPT consultants can help gather all this pertinent information.
Determine the fair market value
Given the size of the investment, you’ve got to make sure you get it for a fair price. Henry Schein PPT consultants will help you get a practice appraisal to determine the fair market value of the practice you’re interested in, so that you can make the right offer. We’ve done thousands of appraisals in all 50 states, so we know exactly how to evaluate a dental practice. You can feel comfortable that you will get a good deal and you can focus on your newly purchased practice.
Take reputation into account
While factors like revenue, income, and expenses are all important to determine value, there are also intangible factors to pay attention to, like the practice’s goodwill. This will be expertly factored into the practice’s valuation, but it’s also helpful for you to research the practice’s reputation in other ways as well. You can check out the practice’s reviews online to see if they’re well received by the community and see how the owner describes the practice’s philosophy on their website. You’ll learn a great deal of information that can’t be found in just the numbers.
Investigate all legalities
As with any legal transaction, it’s important to work with an attorney and your accountant throughout the transaction. Be sure that you have professionals on your team who have knowledge of dental practice sales. Your Henry Schein PPT Consultant can also be a wealth of information, but they will not provide either legal or financial advice, so be sure to consult your own advisors.
Line up financing
One of the biggest stumbling blocks to completing deals is often working out how you are going to pay for it. Assuming you’ve figured out your budget correctly, you know that you have the resources. Be sure to figure out the financing before you start your search. Some lenders will pre-approve you based on your credit score, the down payment you have, and what you can do from a production standpoint. So as long as you find the right practice situation you will be ready to go. Sometimes the current owner will carry the financing as part of the arrangement, which is another possible source of funding.
With the right information under your belt and the right consultant by your side, buying a dental practice doesn’t have to be an impossible endeavor. At the end of the day, a decision this large needs to be prepared for. You can trust the hands-on expertise of those at Henry Schein Professional Practice Transitions; they’ll help you acquire a dental practice that fits your goals, needs, and future aspirations perfectly.