Tips for Buyers

1. Selecting an attorney

Choosing an attorney is one of the most important decisions that have to be made when buying an existing dental practice. It’s best to hire an attorney who has a great deal of experience with dental transactions and rarely spends time in court. Lawyers who do not make many court appearances will have more time to work on your transaction, enabling them to communicate much more easily with the other dental attorney.

In order to be considered an experienced dental attorney, a lawyer must have worked on at least ten completed dental transactions every year for the past three years. If you hire a lawyer who does not meet these criteria, the closing will take much longer than you expected.

2. Choosing a financial institution

Choosing the right financial institution is also important.  About six banks are very well-versed in dental transactions and are very experienced in this area. By choosing one of them, you will make the sale process much easier.

3. Sale process length

The entire sale process usually takes only 45 days. However, it can take significantly longer than that if problems arise.  Although the sale process can be long and cumbersome, it will definitely be worthwhile in the end.

4. Be open-minded about location

Based on data from multiple banks throughout the U.S., it has been determined that 98% of the purchases of dental practices are successful.
Often new buyers are particular about location, size and other characteristics of the practice they are looking to purchase.  As an entrepreneur, a buyer needs to be a visionary as to what the office is to be in the future, but this evolves over time.  Dental offices cannot be custom ordered.

5. Banks will provide extra financing

In most circumstances, the majority of dental banks will finance the entire cost of buying a practice and will not require purchasers to make a down payment. Moreover, dental banks will usually loan buyers an additional amount equal to 5%of the purchase price in order to provide them with working capital.

6. The first step after locating a practice

After you identify a dental practice you want to buy, the next step, which must be undertaken as soon as possible, is credentialing with insurance companies.

7. Marketing plan trumps office renovations

Many new buyers rush to radically renovate their entire offices. However, we have found that it’s best to wait until you have spent some time in your new facility before undertaking this process. Instead, in the initial weeks after acquiring your practice, you should focus primarily on developing a comprehensive marketing plan.

8. The partner trap

Immediately recruiting a partner is a trap into which many buyers fall. Although wanting to work with a good friend from medical school is understandable, we have found that many partnerships eventually break up, costing both partners a great deal of money. If you want camaraderie and better office coverage, hiring a great dental associate is a much better idea.

9. Visibility is important

If at all possible, buyers should look to buy a practice in a highly visible office, and they could consider placing a sign in front of their properties.

10. Leases are challenging

Dealing with the landlord and the landlord’s attorney can be quite challenging.   Obtaining or transferring a lease sounds like a simple process, but it can often drag out for a few weeks and can sometimes last for a few months.