7 Learning Points I Wish I Had Known Before Selling My First Dental Practice

Back in 2013, I was in the process of selling my first dental practice. Since 2004, we had built 3 private dental squats from scratch and then in 2013 sold one of our practices.

This post is about our experience and details 7 points we wish we had known before selling our first dental practice, and how we would do things differently now.

Learning Points

1. Whilst it maybe flattering to get someone out of the blue wanting to buy your practice, understand their motives.
2. Get an independent valuation of the practice, don’t entertain direct offers until you get an independent valuation done.
3. Looking back, whilst we would have had to pay a broker a fee, if they had been any good, we still would have walked away with a price much closer to the offer price.
4. Provide sufficient information up front to the buyer so there is a reduced likelihood of them chipping away at the price. In addition, make sure the Heads of Terms offer some protection to you if such a situation arises.
5. Ideally prepare your practice for sale. Improve the revenue and profits and then go to the market.
6. Don’t entertain just one buyer, see who else is in the market that may want to buy your practice, therefore, use an experienced broker.
7. Get in touch with Samera Practice Sales, we will help you exit your business on the best available terms in the market, whilst dealing with a professional and friendly team.

Flattery from the buyer

For the clinic in question, an approach was made directly to me from an acquirer. I had spent several years building it up with a great team and now was considering my options what to do with the clinic. In addition, with a young family I was considering my options at the time.

Via Linkedin an approach was received and before we knew it we had them meeting with us.

It was one of our first practices, so much of the team were very close to us and we felt it was important that the team were cared for post sale.

All the right things were said by the buyers, which comforted me.

In hindsight, we were flattered that someone wanted to buy our practice, so we went with the flow, not really knowing its value at the time.

Learning Point 1: Whilst it maybe flattering to get someone out of the blue wanting to buy your practice, understand their motives.
Learning Point 2: Get an independent valuation of the practice, don’t entertain direct offers until you get an independent valuation done.

The Offer Price may differ to the Actual Price Paid

Whilst a good-looking offer was made to us, little did we know that would not be the price actually paid.

After due diligence, the price was chipped down, and a “new price” was agreed. We had already committed sizeable amounts of money to solicitors, so being a little vulnerable we accepted the revised price. Since the buyers had come to us directly, we had no middleman to support us and broker the deal.

Again, in hindsight, having a dental broker working on our behalf at the time would have been a very good idea, but at the time we thought we could do it ourselves.

Learning Point 3: Looking back, whilst we would have had to pay a broker a fee, if they had been any good, we still would have walked away with a price much closer to the offer price.
Learning Point 4: Provide sufficient information up front to the buyer so there is a reduced likelihood of them chipping away at the price. In addition, make sure the Heads of Terms offer some protection to you if such a situation arises.

Being Prepared

As I mentioned the approach to buy the practice came out of the blue, so we weren’t performing at our optimum. A couple of years earlier the practice was performing well but with a few team changes, the revenue had dropped a little so the practice was not working at full steam.

Again, in hindsight, we all know the best time to sell a practice is when it is doing its best year. You can command a higher price and dictate the terms, on this occasion we were on our back foot a little.

Learning Point 5: Ideally prepare your practice for sale. Improve the revenue and profits and then go to the market.
Learning Point 6: Don’t entertain just one buyer, see who else is in the market that may want to buy your practice, therefore, use an experienced broker.

Selling my First Dental Practice: Summary View

The market for dental practice sales continues unabated, with more and more buyers entering the market, both individuals and corporates.
Five years have past since we sold our practice but the points we have raised are even more relevant in today’s competitive market.

At the time, we never used a broker, but this experience was the impetus for us to start up Samera Practice Sales, a new Dental brokerage firm.
Since then, we have been trusted brokers to many dental practice sellers. Our team work hard to understand your practice, so they can then best position it with buyers.

Many owners are turning to Samera Practice Sales, with our unique, professional and friendly approach to helping sellers maximise their Dental practice value.

We certainly don’t aim to be biggest, just the best at what we do.

Learning Point 7: Get in touch with Samera Practice Sales, we will help you exit your business on the best available terms in the market, whilst dealing with a professional and friendly team.