THE IMPORTANCE OF PERSONAL TRANSITION GUIDANCE TO ENSURE A SMOOTH, SUCCESSFUL PRACTICE TRANSITION
When you eventually make the decision to sell your dental practice, you may think that the hard part is over once you’ve found a prospective buyer. Actually, that’s just the beginning of the process. Many important decisions, and potential problems, lie ahead:
1) What is the best type of transition for you?
There are many different potential transition avenues to take…1) walkaway sale – as of the closing, the buyer takes over your practice and you are done practicing in your office; 2) pre-sale – as of the closing, you are no longer the owner, but you continue working as an associate in your office, 3) deferred sale – you bring in the potential buyer as an associate, and at a contractually specified time, the actual sale occurs. You may or may not stay on as an associate after the closing, 4) mergers – another practice is combined with your practice, with specified buyout parameters, 5) partnership – you and the buyer become co-owners of your practice, with specific parameters for a buyout down the road, or 6) many modifications of each of these methods.
We at Legacy Practice Transitions have been guiding over 1,500 practice transitions since 1987, so we’re very experienced in helping you select the type of transition that fits your needs.
2) Is this the right buyer?
A questionnaire filled out by a buyer can’t give you all of the answers to that question. Every practice has its own distinctive personality; largely based on yours. The importance of finding a buyer with a similar personality cannot be overstated. Are you and the prospective buyer’s personalities compatible? Are your practice philosophies similar? Is the buyer empathetic, like you are? Is the buyer financially able to purchase at this time? Does the buyer know what he or she is getting into? At Legacy, we spend a lot of time meeting with and talking with dentists looking to buy practices. In Michigan, for example, we have over 150 buyers who are financially able to purchase a dental practice who we converse with on a regular basis. In regard to Erick and myself; as long-standing dentists and former practice owners, we’re very attuned to the nuances of a dental practice, and to the personalities of prospective buyers. Every Legacy consultant has a dental-related background. Our goal is not just to match you up with a buyer; rather, it is to find you the right buyer.
3) What if you and the buyer have disagreements during the contract phase, and beyond?
When you sell your practice, the biggest component of the sale is your practice’s goodwill. The smooth transfer of that goodwill is vital to a smooth, successful transition. As transition consultants, we are a buffer between you and the buyer. It is our job to ensure that the scores of potential points of angst in the contract negotiations, and with the transition in general, get handled in a way that keeps you and the buyer on an amicable basis. You will want to be on a friendly basis with the buyer of your practice during and after the sale. We cannot over-emphasize the importance of this.
Even though we prepare the seller and the buyer for the transition steps ahead, during the course of the typical transition, Erick and I receive an average of over 50 phone calls from both the seller and the buyer. (This is in addition to all of our calls with the attorneys, accountants, and bankers.) These calls are almost always during the evening or on weekends, and are many times spontaneous. When you sell your dental practice, many transitions are happening simultaneously; yours, your family, the purchasing doctor, your staff, and every one of your patients. Think about that! Questions and concerns pertaining to any of these transitions always come up during the course of one’s practice transition, and when they come up, you’ll want to talk it over now and deal with it right away and properly. That’s why we’re here, and why we pick up the phone when you call and want to talk things out. We’re even available to you after the sale.
4) Who should write your purchase agreement contract, and what other transition experts should you talk to?
Legacy Practice Transitions has their own contract attorney, and Legacy has prepared over 5,000 practice transition contracts in the past 30 years. In addition, your Legacy consultant can give you transition contacts of all kinds, including CPAs, attorneys, insurance credentialing consultants, bankers, and others.
5) Are you asking the right price for your practice?
Legacy has been evaluating practices for over 30 years. Most dentists will have the tendency to undervalue their practices if they sell them on their own. As long-time dental professionals who are also very aware of the dental marketplace, we can see all of the elements in your practice that represent value. Just as importantly, we can convey our reasons for that value to the prospective buyer.
6) Should you sell your practice to a corporate entity?
Some practices, because of their particular characteristics, are well suited for a sale to a corporate buyer; or to a dentist multi-practice buyer. There are MANY of each, and they are not created equal. A selling dentist trying to guess which one is best is akin to walking through a minefield. This is why we take so much time getting to know you and your practice. There are nuances to each of these particular entities that would make them suited or unsuited to the purchase of your practice. We work with these purchasing entities all of the time, and are therefore able to find the one (or more than one) that is best suited to your needs.
In closing; at Legacy, we are full-time transition consultants. This is what we do for a living. All of the satisfaction we used to get taking care of our patients, we now get by taking care of you and your practice transition. Whether your practice is big or small, it is your life’s work. is your legacy. We know what that means to you.
COPYRIGHT 2020 ,
Kim Sena DDS Erick Rupprecht DDS
MICHIGAN AND OHIO ANALYSTS; Legacy Practice Transitions