| Top 10 Things You should be thinking about if you want to sell your dental practice in about 5 years |
First of all, this is a good time to ask! You still have time to get your financial
picture in order, buy any new equipment you decide on and get to use it for
several years, and get things generally spruced up. Remember, to sell your
practice, you usually need to provide 3 years’ worth of corporate and
personal tax returns (yes, complete copies of both) to a buyer’s lender and
consultants. Now is the time to plan and get organized!
1. Get your Tax Returns lookin’ good!
Concentrate on the “bottom line,” that is, you should be profitable. If you are
running personal things through your business, such as inflating categories
like office supplies, you might consider ceasing that practice for the 3 years
before a sale to maximize your practice sale profits.
2. Employee Wages
Your employee wages should be an appropriate percentage of your
collections, probably somewhere between 20 – 27% for general practices and
much lower for most specialty practices. Try to stabilize staff and pay each
staff member an appropriate wage for their job position.
3. Hygienists' Salaries
The salaries for your hygienists should be appropriate for each hygienist’s
production. Hygienists should usually produce about 3 to 3 1/2 times their
salary. If their production isn't quite up to that standard, consider hiring a
hygiene consultant to help.
4. Standard Systems
Your systems should be standard, up-to-date, and utilized. If not, consider
hiring a practice management consultant to assist you.
5. Associate Dentists
Generally, it is not a good idea to hire an associate dentist if you have not
been using one or do not absolutely need one. Remember, associates
cannot be bound by covenants not to compete.
6. Technology
Don’t worry particularly about getting the newest, latest, and/or best
technology unless you really want it. It might help your sale somewhat, but
most practices that are sold do not have it.
7. General and Office Equipment
Do keep your general and office equipment relatively new, less than 10 years
old for dental equipment and less than 5 years old for office equipment. If you
need to buy equipment, buy it now so you can enjoy it for a while.
8. Clean Up
Clean out all drawers, stacks, messes and piles. Throw out all unnecessary
and unused stuff.
9. Computerization
If you haven’t computerized yet, now is the time to do it. Many of the relatively
inexpensive software programs seem almost as good as the very expensive:
pick a standard, commonly used program and go for it. If you are
computerized, be sure you have relatively modern equipment and monitors
(probably less than 3 years old).
10. Reception Area
Get and keep your reception room decorated, clean and very neat. The first
impression really counts. Consider hiring a professional decorator, even if
just for that room.
picture in order, buy any new equipment you decide on and get to use it for
several years, and get things generally spruced up. Remember, to sell your
practice, you usually need to provide 3 years’ worth of corporate and
personal tax returns (yes, complete copies of both) to a buyer’s lender and
consultants. Now is the time to plan and get organized!
1. Get your Tax Returns lookin’ good!
Concentrate on the “bottom line,” that is, you should be profitable. If you are
running personal things through your business, such as inflating categories
like office supplies, you might consider ceasing that practice for the 3 years
before a sale to maximize your practice sale profits.
2. Employee Wages
Your employee wages should be an appropriate percentage of your
collections, probably somewhere between 20 – 27% for general practices and
much lower for most specialty practices. Try to stabilize staff and pay each
staff member an appropriate wage for their job position.
3. Hygienists' Salaries
The salaries for your hygienists should be appropriate for each hygienist’s
production. Hygienists should usually produce about 3 to 3 1/2 times their
salary. If their production isn't quite up to that standard, consider hiring a
hygiene consultant to help.
4. Standard Systems
Your systems should be standard, up-to-date, and utilized. If not, consider
hiring a practice management consultant to assist you.
5. Associate Dentists
Generally, it is not a good idea to hire an associate dentist if you have not
been using one or do not absolutely need one. Remember, associates
cannot be bound by covenants not to compete.
6. Technology
Don’t worry particularly about getting the newest, latest, and/or best
technology unless you really want it. It might help your sale somewhat, but
most practices that are sold do not have it.
7. General and Office Equipment
Do keep your general and office equipment relatively new, less than 10 years
old for dental equipment and less than 5 years old for office equipment. If you
need to buy equipment, buy it now so you can enjoy it for a while.
8. Clean Up
Clean out all drawers, stacks, messes and piles. Throw out all unnecessary
and unused stuff.
9. Computerization
If you haven’t computerized yet, now is the time to do it. Many of the relatively
inexpensive software programs seem almost as good as the very expensive:
pick a standard, commonly used program and go for it. If you are
computerized, be sure you have relatively modern equipment and monitors
(probably less than 3 years old).
10. Reception Area
Get and keep your reception room decorated, clean and very neat. The first
impression really counts. Consider hiring a professional decorator, even if
just for that room.
Bette Robin, DDS, JD 877 DrRobin
SELECT PRACTICE SERVICES, INC. / DENTAL PRACTICE SALES
SELECT PRACTICE SERVICES, INC. / DENTAL PRACTICE SALES
DrRobin@BetteRobin.com
17482 Irvine Blvd., Ste. E
Tustin, CA 92780
Tustin, CA 92780
877 DrRobin
714-421-4407
714-398-8808
714-421-4407
714-398-8808
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