Who should I have on my dental practice transition team?
We are often asked both by potential practice sellers and buyers who they should be working with in a practice purchase and sale situation or a buy-in/buy-out situation. The answer can vary depending upon the transaction and sophistication of the parties involved. However, there are typically a number of important participants in a successful practice transition transaction.
Sellers
If you are selling your practice, as a whole or in part, your team might include: a practice broker, an attorney, an accountant, your financial planner, and, of course, your spouse or any interested family member. Each of those people can offer a valuable service and perspective.
For instance, a practice broker will know the market, know how to reasonably value your practice, market the practice, vet potential buyers, handle negotiations, assist with preparing to sell, and guide all the participants and professionals though the process. Even in situations where a seller may have found a buyer on his or her own, or may have been approached by a dental service organization (DSO) or multi-practice owner, a broker can add value by ensuring that you obtain top dollar for your practice, the best terms of payment, the best terms for closing, and the best terms for post-closing obligations, if any.
Your attorney can negotiate and draft or review legal documents, such as purchase agreements, leases, non-competes, bills of sale, post-closing employment agreements, consulting agreements, etc. Even if the buyer’s attorney or the broker does the initial draft of legal documents, it is usually a good idea to have your attorney review these documents. Note that in a buy-in situation there is typically both a purchase agreement and a resulting partnership or shareholder agreement generated, along with exhibits and other closing documents.
Your accountant will definitely want to review what is called the “purchase price allocation” in a practice sale situation, as that has significant tax consequences for you (and the buyer). In a buy-in situation, your accountant should be even more involved in thinking about the buy-in structure, how and when you get paid, and what the resulting entity will look like.
Your financial planner should be kept appraised of your transition plan, as the transaction may well result in funds that you will want to invest or utilize to pay down debt or otherwise use, either immediately or over a period of time depending upon how you are paid.
Whether to involve your spouse or other family members in the transaction is up to you, but practice transition is often an important family decision, so you exclude them at your peril!
Buyers
If you are buying a practice, you will have many of the same professionals involved, such as your own attorney to draft or review legal documents and your own accountant to advise on tax consequences. Your attorney and accountant should also work together to advise you on setting up an appropriate entity in which to take possession of the assets in a practice purchase situation or to advise you on the consequences of becoming an owner in a partnership or corporate entity.
In the case of a practice purchase or buy-in, a buyer should also have professional assistance conducting what is called “due diligence” or the buyer’s request and review of relevant practice data to ensure that the buyer is making an informed decision. Many accountants will assist in conducting doing due diligence. Another option is using a practice broker working for you for the specific purpose of conducting a due diligence review. The bottom line is that you should feel comfortable with the risk you will be taking in becoming a practice owner.
Most buyers will utilize the services of a lender, especially if you are purchasing a practice outright. Financing is currently plentiful, and interest rates are historically low, but terms of repayment and post-closing lender relationships vary, so make sure you understand your financing. If you need a lender, a practice broker or attorney or accountant who works frequently with dentists will be happy to provide a referral.
In the case of an outright sale, a buyer will also need to set up business insurances, such as workers’ compensation, contents and general liability insurance. A buyer may also need or want life and disability insurance. One option is to use the insurance professional that the seller is using, or again, a broker or attorney or accountant who works with dentists will be happy to provide a referral.
And, finally, just as practice transition is an important time for the seller, buying or buying into a practice is a major life decision for you. So, please feel free to involve your spouse or other important family members!
If you have questions about the content of this blog, please feel free to contact Optimal Practice Transitions, LLC, at info@optimalpracticetransitions.com or 888.888.6506.
Everything is very open with a precise clarification of the challenges. It was really informative. Your website is useful. Thanks for sharing!
May I just say what a comfort to uncover somebody who truly knows what theyre talking about on the internet. You actually know how to bring a problem to light and make it important. More and more people should look at this and understand this side of the story. Its surprising you arent more popular because you certainly have the gift.
May I just say what a comfort to uncover somebody who truly knows what theyre talking about on the internet. You actually know how to bring a problem to light and make it important. More and more people should look at this and understand this side of the story. Its surprising you arent more popular because you certainly have the gift.
May I just say what a comfort to uncover somebody who truly knows what theyre talking about on the internet. You actually know how to bring a problem to light and make it important. More and more people should look at this and understand this side of the story. Its surprising you arent more popular because you certainly have the gift.
Im excited to discover this web site. I need to to thank you for ones time for this wonderful read!! I definitely savored every bit of it and I have you bookmarked to look at new information in your web site.
May I simply say what a relief to uncover somebody that really understands what theyre discussing over the internet. You certainly know how to bring a problem to light and make it important. More and more people really need to check this out and understand this side of the story. I was surprised that youre not more popular because you certainly have the gift.
Качественные WordPress ссылки в комментариях от 5000 уник. доменов заказать здесь .
Use artificial intelligence to cut turnaround time, extend your budget, and create more high-quality content that Google and readers will love. How It Works? WordAi is extremely fast and intuitive. Just enter your content, click rewrite, and in a matter of seconds, WordAi will rewrite an entire piece of content for you. WordAi comes up with different ways to express the same ideas by rewriting every sentence from scratch. This not only removes duplicate content, it also makes the rewritten content read completely naturally. Scale Your Business Make your entire content production process 10x more efficient. Use AI to create more high-quality, unique content that impresses clients and engages readers, all without having to put in more hours Register here and get a bonus.
I was pretty pleased to discover this great site. I need to to thank you for your time for this particularly fantastic read!! I definitely appreciated every part of it and I have you book marked to see new stuff on your blog
I was extremely pleased to discover this page. I want to to thank you for ones time due to this wonderful read!! I definitely appreciated every part of it and I have you bookmarked to look at new information on your web site.
Really enjoyed this post.Really thank you! Keep writing. makaberzux
Really enjoyed this post.Really thank you! Keep writing. makaberzux
Really enjoyed this post.Really thank you! Keep writing. makaberzux
Really enjoyed this post.Really thank you! Keep writing. makaberzux