How to Buy a Dental Practice: Making Your Transition Easy

Buying a dental practice is exciting, but can also be stressful, time consuming, and emotional. At Dental Health Care Practice, LLC, we handle all the details involved in transitioning a practice. We have many contacts in the business and maintain a database of dentistry practices for sale in six states. We’ll help you purchase a practice from a dentist that shares the same approach as you. A good culture fit is important in maintaining the continuity of the patients and staff. 

Coordinating the Transition

Our founder, Dr. Gary Boyajian, DDS, practiced dentistry for over 25 years. He understands how to assess a dental practice. Buying a dental practice involves many details and coordinating with interrelated professionals who all have to perform in a timely fashion. 

Healthcare Practice Sales LLC has handled hundreds of successful transactions. We are the only dental broker who has two CPAs on staff helping to make sure all the financial details are accurate and in order. 


Buying an Existing Practice

Buying your first practice doesn’t have to be overwhelming. We’re available to help you every step of the way at any hour of the day. Someone is available 24/7  nearly every single day of the year to help you buy an existing practice. Dr. Boyajian, or one of his dental accountants, will answer the phone personally. They’re involved in every part of the transaction maintaining and coordinating all those moving parts to ensure a successful conclusion. 

Our experience has shown that this unique feature of our brokerage is of great value and comfort to all involved parties. Anyone involved in the transaction, can call Dr. Boyajian at your convenience, even outside of normal business hours. You can call when you have the time and privacy to ask questions and still have your concerns addressed thoughtfully and accurately. 


Practice Acquisition

Buying a dental practice can be an involved and drawn out process. We may have several rounds of back and forth negotiations. One of your biggest difficulties is competition.  There are more buyers interested in buying a practice than there are dentists willing to sell. This means when you find a practice that suits you, you will have to act relatively quickly before another dentist makes an offer. We will help manage these negotiations for you.

We can absolutely assure you that we’ll represent your best interests and do our due diligence. When we work together we will help you understand the financial data behind the valuation of the selling practice and make sure you don’t pay one dime more than necessary. 

We’re one of the very few brokers who’ll accompany you on every one of your visits to potential practices. This will ensure that your visit goes smoothly. Your questions will get answered quickly and comprehensively. We want you to feel comfortable and confident in your decision. 

Given the competitive environment you’ll face, we assure you won’t face it alone or without a plan. We’re here to help you every step of the way. 


Our Due Diligence

We will:

  • Manage your negotiation
  • Solve problems that will inevitably occur
  • Eliminate roadblocks
  • Minimize red tape and hassles

Purchasing a dental practice is an involved process. Thankfully we are here to give you a plan. We have compiled a list of suggestions you’ll find useful as we piece together all the moving parts. These steps aren’t in absolute order. Some steps occur simultaneously while others are independent of one another. 


Steps to Buying a Dental Practice

What kind of practice do you want to maintain? If you’re going to take over an existing dental practice, the clients of the selling office should be a match for the kind of patient base you want to maintain. Continuity within the transition helps the patients feel at ease. When patients feel continuity, they will stay with your office after you purchase the practice. 

Patients records comprise a large part of the price you’re paying for the practice you’re purchasing. You need to keep the current clientele because they provide the cash flow necessary to maintain your practice. Fortunately, we’re great matchmakers. We’ll help you keep your patient base. 


Selecting an Attorney

Choosing an attorney is an extremely important decision. There is certain criteria they must meet in order to be qualified to represent you in your purchase. Your attorney will handle the legal details for your side of the transaction. It’s important that the attorney has expertise in the dental industry. We define a dental attorney as one who’s worked on at least ten completed dental transactions a year for at least three years. 

We work with attorneys to ensure that your interests are represented and protected. We make sure there are clear agreements such as having non-solicitation provisions and non-compete clauses.

It’s important to choose an attorney who doesn’t spend much time in court. Attorneys who spend a lot of time in court have less time to work on your transaction. It’s also harder for them to communicate information with you, the seller’s attorney, or anyone else involved in the transition. 

If you hire an attorney who doesn’t meet this criteria, your closing will take much longer. The entire deal may even fall apart and you’ll have to start over from scratch. Once the appropriate attorney is selected, we can help you get financing.


CPAs:  Adding up the numbers

We may be the only dental brokerage firm that has two on-staff dental CPAs to help you and the seller reach a fair valuation. The numbers need to work for everyone involved. 

Our CPAs will help you understand the numbers in your offer and help you see exactly what it is you’re buying and the value of every part of the practice. Additionally, you’ll be able to get an estimate of the future valuation once you take over the practice.


Choosing a lender

Few dentists are able buy a practice with their own funds. Fortunately, we are in a very favorable lending market. Financial institutions are willing to lend because dental offices have an extremely high success rate. Since they’re confident in your ability to repay your loan, they’re willing to provide the financial means to do so.

Currently, there are six banks that are very well versed in dental transactions. Along with banks, there are private equity firms that are also are willing to lend. Many will lend 100% of the sale price and do not require a down payment. Dental lenders will even loan an additional 5% of the purchase price in order to provide you with working capital. This is a great time to buy while interest rates are at historical lows.

Financial institutions are willing to lend because dental offices have an extremely high success rate. Bank of America quotes the success rate at a little over 98%. They’re confident in your ability to repay your loan. With our help, you’ll find the most suitable lender. We’ll make sure your loan is affordable while still giving you enough money to pay for personal expenses.


Finding a location for Your Dental Office

We have extensive databases of suitable dental practice sellers. We will help you find the most ideal practice. As a business owner or entrepreneur, you’ve probably been dreaming of opening your own office for a long time.  Of course, you’ll have particular ideas about the location, size, and other characteristics of the practice you’re looking to purchase.

Unfortunately, practices can’t be custom ordered. Your ability to remain open minded and flexible will make the process run smoothly. Keep in mind that your ideal practice will evolve over time. Eventually, you can make the changes you need to make. You don’t have to do everything right away. It can make things more stressful, disruptive, and expensive. 

After practicing for a while, you may find you don’t need to make all the changes you previously thought were necessary. The selling dentist treated patients effectively with the equipment that was in place. It may serve your new investment to focus on a new marketing plan that will grow the practice rather than focus on renovations that change the office. 

As with any business, location is a key factor in being successful. Ideally, you should look to buy a practice in a highly visible location. If local ordinances allow, having a sign in front your property is an easy way to let people know you’re open for business.


Property and leases

Leases and property purchases must be handled carefully. Property agreements and leases must be scrutinized. There will be a landlord and the landlord’s attorney which will add to the number of professionals involved in your sale. Whether you are planning on buying or leasing the property we can help you with every step of the process. Problems with leases and commercial purchases are common. We make sure all participating parties are involved and agree. Lack of agreement when buying a practice can hold up the sale for longer than almost any other reason. You simply can’t buy the practice until this area is settled. 

After you identify the dental practice you want to buy, your next step is credentialing with insurance companies. This must be undertaken as soon as possible. With the exception of Medicaid, credentialing is provider specific, so you need to let the insurer know you’re the one who’s going to be paid.

We have gone through most of the aspects of buying a dental practice and you will find that our services extend beyond these considerations. With our extensive experience and resources, we’ll help you put together a plan that will make your new practice the most successful it can be.


Additional Guide to Buying a Dental Practice

Avoid the partnership trap

Many dentists who are looking at buying or leasing a dental office will consider practicing in partnership with other dentists. They feel bringing in a partner will provide them with a greater work/life balance for themselves, and greater coverage for their patients. They may feel that a partner can bring contrasting yet complementary strengths. The idea of sharing some of the responsibilities, liabilities, and costs can be very alluring.

While no one can dispute the benefits of entering into partnership, the simple fact is that half of all partnerships fail. You need to recognize and acknowledge this hard truth. It’s much easier to create a partnership than it is to dissolve one. 

Dissolving a partnership is financially and emotionally draining. Even worse, the partnerships that don’t break up often limp along in what can only be described as a very bad marriage. Your staff, as well as your patients, won’t like being in an atmosphere filled with so much tension and anger. 

Understandably, some dentists still would like the day to day help and camaraderie another dentist can provide. There are other ways to accomplish that goal without taking on a partner. For example, you can hire another dentist as an associate. Hiring another dentist to work as your associate will provide you with the benefits of partnership without the liabilities. 


Marketing trumps office renovations

Many new buyers rush to radically renovate their newly acquired offices. This is often a mistake because it’s expensive, time consuming, and disruptive to a practice that’s just transitioned to a new dentist. Surrounding yourself, your staff, and your patients with too much change is stressful and overwhelming. 

The urge to improve the office is natural, but there are other options. An alternative to renovating the office is to develop and renovate your marketing plan. New dentists can see an increase of 20% in revenue their first year in business by updating their marketing strategies. 

Dentists who have been practicing for several decades started their practice at a time when doctors were prohibited from marketing their business. Even though marketing for a doctor is acceptable today, the taboo still exists in the minds of some established dentists. They built their practice without ads and may not see the value in optimizing their marketing efforts. New dentists are more likely to see marketing as an important function of their business. 

The financial statements and valuation will reveal how much the selling doctor spent on marketing and what marketing was successful. You can use the findings to implement a new and improved plan to attract more patients to your business.


Assistance in the preparation of offers

Currently, dental practice buyers are facing a very tight market. There are more buyers than sellers. This means your offer has to be the best possible. We will assist you in preparing an offer that has a high likelihood of being accepted by the seller while still being affordable and viable for you. 

No matter how reasonable and fair we may think your initial offer is, the seller may reject it. That doesn’t mean the deal is dead. At your request, we can communicate a counteroffer. We will continue to negotiate until both you and the seller agree on terms. We will work on your behalf to remind the seller that you have been prescreened and have made a fair and carefully thought out offer. Good contracts benefit both sides of the transaction. 

We promise to follow up and keep you informed at every stage of this process. We will arrange and accompany you on all of your visits and provide prompt and comprehensive in our answers We will help you overcome obstacles and get you the most ideal office. Set yourself up for success and watch your business blossom with our help. 

Most contracts are very complex. We make sure you understand and are comfortable with each detail. 

Typical transactions take about 45 days. Although we are problem solvers, if you follow our advice you will eliminate obstacles and minimize red tape and hassles.


Our Commitment and Due Diligence

No other dental practice brokers offer what we do. No one has the quality and number of professionals on staff that we do. No one we know employs two on-staff CPAs to create accurate valuations and appraisals. 

We make ourselves available to you 24 hours a day, 7 days a week, 363 days a year. (We’re closed Christmas and Easter). Our founder and owner, Dr. Gary Boyajian, DDS, along with his accountants, will oversee every detail of your transaction. 

We stake our reputation on our performance. We don’t let people down. We will help you accomplish your goals.  


Next Steps to Buying a Dental Practice

Hiring the team of experts at Health Care Practice Sales, LLC, will make the process of buying your practice as easy and financially rewarding as possible.

If you’re interested in buying a dental practice, you can email us at performdent@aol.com, call us at 201-663-0935, or fill out our contact form.

If you’re still feeling unsure, please check out our testimonials page. There you’ll read about the wonderful experiences our clients have had using our services. We hope to hear from you when you’re ready to make your dental practice transition.