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Closing the Deal

 If you are planning to sell your dental practice here are some tips to maximize the sales proceeds.

  1. Allow lots of time. Don’t rush to buy your retirement home in Palm Springs. And don’t wait until health problems force your hand. Purchasers are astute. They can sense very quickly if you are in a hurry to retire, all of which may be reflected in a lower offer.
  2. Update your business systems. With a tougher economic climate for practices, purchasers pay a premium for an administrative system which keeps revenues growing, ensures maximum utilization of staff, and keeps the overhead at 40%. Consider using our affiliated company Becker Practice Management to help you fine-tune your systems.
  3. Never let billings slip. It does not matter how much money you made in the last 15 years; the revenues and the cash flow in the year of the sale is what counts. A practice with slipping profitability is a hard sell.
  4. Be involved. Unlike a home sale, where the broker does all the work and the purchaser does not really care if he ever meets you, in a practice sale, you are the best salesperson. When you and the prospective purchaser “hit it off”, you can bet that the practice sale will go smoothly. Personal bonding is that the glue which will keep the deal together.
  5. Put some lipstick on. Make sure that your practice has curb appeal. It means that your office is in good repair with fresh paint and clean carpets.
  6. Be realistic. Set a reasonable price and have it backed up with a professional practice valuation.
  7. Minimize post sale commitments. Make sure that your liability for staff severance does not exceed 90 days. Ensure that the lease for the premises can be assigned and without your continuing personal guarantee.
  8. Prepare professionally looking documents. This would include a practice and patient profile, as well as up-to-date financial statements and billing records. If you are in a group practice, make sure that the cost-sharing and buy- sell agreements are up-to-date.
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