It is absolutely possible to sell your dental practice yourself without the need for a sales agent, however, given the value of this asset most tend to bring in some specialist help.
Based on my own experience I have set out the five most common mistakes when selling privately.
- Allowing the buyer to value your business – this is the first cardinal sin. Whether the buyer is your friend down the road, an associate or corporate you must take control of the valuation. It is vital to ensure it has been prepared on an independent basis and reflect what your practice is worth in the open market. A corporate that could own hundreds of practices offering to ‘value your practice for free’ may have a vested interest in being less than generous with the valuation as they will be the buyer.
- Keep it confidential – selling your dental practice could take up to nine months and during this process it is really important that you keep it private. Without being able to present a full picture to your staff it could well cause unrest to the point where someone leaves. Equally, you don’t want patients to be disturbed and find another practice. Both of these factors impact on of the goodwill value of your business if poorly managed.
- Sharing too much information – a buyer will want financial and non-financial information about your practice and the sharing of this needs to be carefully managed to ensure that only truly interested parties get the nitty gritty detail. You need to filter out those who are just searching for information with no desire to buy – with over 4,500 dentists looking to buy a practice this can be a daunting task.
- Negotiating – this is core to getting a good deal. The overall deal isn’t just about the price either. Some buyers will lead you to believe that part (could be 30%) of the purchase price being deferred is normal – it isn’t. There could well be restrictive covenants and you need to know what can be negotiated and those that are non-negotiable (which is very few).
- The power of the open market – when selling privately it can be difficult to manage the expectations of different interested parties. However, this is vital if you are to secure the best price for your practice. By starting with a wide audience and filtering this down to the 2-10 who are seriously interested will ensure the process remains competitive and provide a Plan B should things not work out with the preferred buyer.
With careful management and a considerable investment of time there is no doubt you can self-manage a sale. On the flip side, if you would like to focus on doing what you do best (dentistry) and engage a team of specialists to manage the end to end process we would love to hear from you.
Whichever route you take I wish you all the very best on your journey.