What Most Dentists Want From Their Practice Transition (and How To Get It!)
by Joe McGonigal, DDSmatch MidAtlantic
I meet with a lot of dentists to discuss their eventual practice transition. In that initial meeting, my top priority is to understand what the owner’s primary goals are. What I’ve learned, is that in nearly every instance, dentists ultimately want two things – control and options. No one ever comes out and says it that way, but indirectly, that’s essentially what they’re asking for.
Makes sense. If I had spent 30+ years building a practice, caring for patients, developing a team, and being part of a community, I’d want control and options when it’s time to transition my practice too.
In terms of control, owner dentists want to know things like:
- How a fair market value, and ultimately, a selling price will be established
- How we’ll identify and market the practice to high-quality, qualified buyers AND maintain confidentiality while doing so
- What other advisors they’ll need to engage and when that should happen
- What the steps are once we start receiving offers and how to negotiate them
Selling a dental practice, like many other small businesses, is a process. And while most of it happens in a logical sequence, there is an emotional component that can’t always be mapped out step-by-step. For that reason, at DDSmatch, we make sure our client, the practice owner, knows they are 100% in control from start to finish. If things are moving too fast, we can slow down. If they’re having second thoughts or concerns, we can pause the process and re-evaluate. Control is important to all of our clients, and we ensure they always have it.
Similarly, when it’s time to sell their practice, dentists want options, specifically when it comes to things like:
- How much the practice will sell for
- Who they’ll sell it to – private buyer or DSO?
- How the team and patients will be impacted
- Their transition options – will they stay on and work or exit the practice after closing?
- How the deal will be structured
All of this is logical and reasonable. Ironically, an overwhelming majority of dentists do the one single thing that limits the options they’ll have (and sometimes the control) when it’s time to transition. They wait too long to start the process. The more time you give yourself, the more options available to you.
When you’re not in a rush, or under pressure due to other circumstances like a health issue, you have the freedom to strategically design and execute an ideal transition. If you want a higher price for your practice, you have time to improve the business operation to increase the value. If you’re looking for a very specific buyer, you can take your time to find that person. If you’re interested in affiliating with a DSO because you want to practice dentistry a few more years, but don’t want to manage the practice any longer, give yourself enough time to fulfill your employment commitment instead of having to ‘grind it out’ for two years because ‘you have to.’
In nearly every transition scenario, time is your friend and having more than you need is far better than the alternative. You don’t have to be ready to retire or sell your practice to meet with a transitions professional. In fact, you should meet with one 3-5 years before you’re ready to do either, giving you plenty of time to properly plan and design the ideal transition.