So you’ve decided to sell your practice? You’re moving to a new area? Retiring? Fancy a change? Although each seller may have a different reason for selling; the end result remains the same. To maximise the sale price and have the process as stress free as possible. So before you sell your practice, consider the following questions.
What’s the market like?
You wouldn’t sell your house without considering the market, so the same should be considered with your dental practice. Have you thought about your options for locating, identifying and contacting potential buyers? If not, it may be a good idea to contact an agent to find out about the status of the market and potential buyers.
What is the true value of my business?
When you consider the value of your business, both implied and actual assets need to be accounted for when valuing your practice. This includes your patient list and income. If your patient list is well maintained, it will be one of the most valuable assets to your potential buyer. It is also these patients that produce the income and so important you can verify your annual and monthly income to show your practice’s position in the market place, trends and projection of future sales. This could be the critical information that attracts your buyer.
How long will it take to sell my practice?
Factors such as your financial records, value of your practice and demand in the market could determine the time it could take to sell your practice. Therefore, be prepared for a lengthy process, but if you are well prepared you can minimise this. A sale can be achieved from an accepted offer through to completion in 4 months if you are well organised.
How should the terms of the restrictive covenant be structured?
If you’re selling your practice to retire then this isn’t something to worry about. However if you’re selling to buy a new practice or work in another practice you own, the restrictive covenant will need some consideration. A restrictive covenant is an agreement not to work in within a specific geographic area of your sold practice for an agreed amount of time. Make sure this is understood and agreed upon so that you’re protected from possible litigation in the future.
How long will I need to continue working?
The amount of time you will need to continue working depends on the requirements of the buyer, this can vary from a few months to a few years. This is often referred to as a “transition phase” which allows you to support the new owner so they become comfortable and familiar with staff and patients.
For answers to more questions like this and to talk about your individual practice the award winning team at Frank Taylor & Associates are available on 0330 088 11 56.