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Don’t Wait Until Your Breaking Point to Sell Your Practice!

 

Dentists often ask when they should sell their practice. This, of course, varies for everyone, but, if you are able, the best time to sell is when you are financially ready and still physically capable of enjoying working and managing your practice. 

 

Why would you sell your practice when you are enjoying it you ask? So that you don’t regret it.  Each year we see dentists who wait to list their practice for sale until the very moment they are ready to retire, and then the next few months are horrible. The sale of your practice is not instantaneous, even for the best practices. Once you make the decision to sell, it can take a few months before you complete the sale—at least. You may need to make some minor updates to your office to make it more attractive (painting, cleaning, etc.). You need to interview and hire a reputable broker like Karl Frye of Frye Practice Sales & Healthcare Real Estate to handle the sale for you. There needs to be a valuation of the practice so you can determine a Fair Market Value listing price. You’ll also need to meet with your CPA to ensure you can indeed afford to sell and retire—all of this before the practice is shown to prospective buyers! Once you have a buyer, an offer, and signed Letter of Intent, you still have to allow the buyer time to get through the financing process with banks which takes a few weeks. Then, your attorney and the buyer’s attorney need to draft, review, and agree upon the purchase agreements. The buyer will also have to negotiate a lease with your landlord or, if they are purchasing the real estate, they have to appraise the property, complete surveys, and include an additional purchase agreement for the building. Needless to say, this is not a quick process. 

 

During this time, you have to keep going to work, keep up your production and collections, keep a staff in place and not let on to your staff and patients that you are ready to be DONE. If you wait until you are emotionally or physically finished being a practice owner, this is painful and a nearly impossible task. Imagine having to go to work, day after day, dealing with staff call offs, patients cancelling at the last minute, your back hurting, and spending all day wondering if today is the day that you will find a buyer for the practice. Doesn’t sound like fun, does it?  And as we mentioned before, the sale process is not quick, so this could last for several months. During this time, if you begin to resent your practice, it will reflect negatively on your office and will make the sale process even longer. By the time you do finally get to your Closing Day, it won’t be a joyous occasion and you won’t be able to celebrate your retirement or give the new doctor the welcome he or she deserves. You will just be ready to sign the papers and run! 

 

Now, imagine an alternative scenario… You make the decision to sell your practice while you are still happy at work.  You complete all the necessary pre-listing tasks and you can now take your time and not feel overwhelmed during the process. You are able to go to work each day feeling like you have prepared yourself for the eventual sale and know that you have the luxury of time to find the right buyer. AND, when you do sell the practice, you may even have the desire to keep working part-time, either for the buyer of your practice or at another office. If you aren’t rushed to sell immediately, many of the pressures of selling your practice will be alleviated. 

 

Obviously not everyone has the luxury to sell this way. The urge to retire or the physical need to retire may come before you are able to plan for it. But for those who are able to prepare for a sale, the process is much better. If you want to prepare for the eventual sale of your practice, call Karl Frye @ Frye Practice Sales & Healthcare Real Estate today at 480-599-6958 to discuss your options.

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