Step by Step Guide on Selling a Dental Practice
We created a simple and concise step-by-step guide to selling your dental practice, describing the steps involved during the sale and explaining how we at Pluto Partners can assist you every step of the way.
- The selling journey begins with a valuation -
Valuation is discerning how much your dental practice is worth and can be sold for. There are several ways you can do this; however, the most common valuation methods are an income-based valuation method, where ‘income’ is considered the pre-tax cash flow of your dental practice, market-based valuation methods and net-based valuation methods.
Pluto Partners’ vast experience in the dental practice sales market ensures a competitive valuation using multiple valuation methods. We provide a valuation report of your practice within 48 hours, and complete a comprehensive valuation within 7 days. This method guarantees you are intimately aware of the value of your practice.
- The Power of Information -
Any potential buyer needs to know about your dental practice. You can do this in a variety of ways, including preparing look-books and brochures that contain specific information about your practice.
Pertinent information to include comprises details surrounding physical space, pre-existing staff and dentists, equipment, and account information. Being upfront about this information ensures potential buyers are informed and helps to weed out buyers who are not the right fit.
Pluto Partners will help you create stunning documents that showcase important information about your practice. We go above and beyond to also create a bespoke marketing solution for each client. Virtual showings drastically improve sale ratings and propel buyers to move more rapidly.
- Promoting the Sale -
Promoting your practice can be difficult, particularly if you are doing it alone. Most dental practices nowadays are sold through dental brokers, though there are other ways to market your practice.
Chatting with dental supply and equipment representatives is a good way to promote word-of-mouth about your practice. They tend to know a lot and are frequently in communication with potential buyers.
You can also use dental society websites to promote your practice. Most dentists are a part of at least one dental society, making you likely to find an interested candidate or two.
Because of our years of experience in the dental brokerage industry, Pluto Partners has a vast database of motivated buyers locally and nationally. We ensure your practice is shared with buyers ready to buy.
- Presentable and Prepared -
Even before you list your practice, it’s generally a good idea to do a quick cosmetic upgrade, including a deep-clean, painting walls, and fixing any broken equipment or furniture. These small changes help your practice shine once viewings begin.
It’s a great idea to ask for feedback from potential buyers to identify any weaknesses within your preexisting practice.
Because we create a bespoke marketing plan for each client, Pluto Partners works hard to exclusively show your practice to very interested buyers.
A physical visit only takes place once a buyer is interested in both your practice’s information and the physical space they’ve seen in the video, saving wasted time and energy on everyone’s behalf.
We always aim to begin showing your practice within 7 days of listing.
- Offers and Negotiations -
An offer has been made. Fantastic! You must now negotiate the price and terms of the offer with the buyer. Both a broker and a lawyer are critical figures here to help you sort through the complicated clauses and legal jargon.
Pluto Partners has an extensive and diverse network of lawyers and financial experts to provide you the expertise and experience you need when an offer has been made and negotiate effectively on your behalf.
- Closing the Deal -
Closing the deal requires appropriate and often extensive paperwork. Most sales require many of the same legal documents:
- SPA (Sale Purchase Agreement): An agreement that protects both parties and legally obligates the buyer to purchase the practice and the seller to sell the practice.
- Deposit Agreement: Ensures a deposit is paid by the buyer on the agreement of a sale. The buyer is then invested in the purchase and is less likely to walk away.
- Property Lease Agreement: Allows the buyer to review the seller’s lease. If the lease term is up, the buyer might have to work directly with the landlord of the office space.
- CQC (Care Quality Commission) Application: The form ensures the dental practice complies with England’s Care Quality Commission. The form also provides an up-to-date criminal check. The CQC application takes 8-12 weeks to be processed. As a seller, be sure to cancel your application or remove the sold location from your CQC registration.
- NHS Contract Transfer: A legal document on behalf the National Health Service that transfers clinical service contracts from one owner to another (omit for private practices or LLCs).
- Business Associate Agreement: A business associate agreement must be signed by all business associates ensuring the associates follow NHS’s privacy and security standards.
- Stock Purchase Agreement: Finalizes the terms and conditions of the sale of the practice.
Pluto Partners is well-versed in understanding and interpreting complex legal documents for the seller. We will help you and guide you along the way and expedite the process wherever possible. The legal experts that we recommend make sure the documents are iron-clad and protect you and your pre-existing practice.