No matter where you are in the selling process, you can never begin too early. The next thirteen tips can help you strengthen your current practice today.
1. Control your fees. Your practice fees should be reviewed and adjusted each year. There are a number of resources available to you for reporting fees by zip code. This is an extremely important and valuable task, as proper management of practice fees can add significant value.
2. Build a cash-flow analysis. The total value of the dental practice cannot surpass the ability of the practice to produce a large enough cash-flow to service the debt and provide a reasonable profit to the purchasing dentist. The net income of the practice is adjusted to return all income to the dentist as well as benefits to maximize net income. Owner benefits typically consist of all deductions for expenses not related to practice operations, but which were paid to the selling dentist.
3. Maintain your production. Sometimes owner/ doctors will start to slow down before actual retirement. This results in an exponential decline in profit and practice value. It is important to maintain the historic growth rate of the practice until the sale closes.
4. Maintain new patient numbers. Practice acquirers hone in on this data point and consider it to be a true indication of the practice vitality.
5. Get your financial records in order. Typica dental practice profit and loss and income statements fail to give a true practice overhead and profit picture. Ask your accountant to group related expenses together for the purpose of determining true profit. If you own two practices, avoid a co-mingled tax statement.
6. Reinvigorate your recall system. Hygiene income usually comprises 22 to 25 percent of the total income in a typical general practice. This percentage can climb to 30 percent or more in practices aggressively utilizing soft-tissue management procedures. Generally, the higher the hygiene percentage, the better ... unless a situation occurs where the doctor is underproducing, which articially raises the hygiene percentage
7. Review the condition of the dental patient records. Through due diligence process, a purchaser usually will review a representative sample of the patient records. The practice owner should maintain les with total treatment logs, current patient data, and easily understood treatment plans.
8. Clean up clutter and upgrade the office decor. A typical prospective dental purchaser will be reviewing multiple practices. Every attempt should be made to make your dental office stand out in this environment.
9. Improve the dental equipment. Purchasers expect to see modern equipment in the dental practice. The practice owner should keep all equipment updated, from both a use and design function.
10. Do not let the lease lapse. Do not let the lease lapse. Do not let the lease lapse!
11. Examine your dental treatment mix.
12. Emphasize fee-for-service. Dental practice purchasers place a real importance on the fee-for-service component of practice income.
13. Check with your financial and business advisors. Talk with your dental practice transition consultant about a draft dental practice evaluation. - 15437
1. Control your fees. Your practice fees should be reviewed and adjusted each year. There are a number of resources available to you for reporting fees by zip code. This is an extremely important and valuable task, as proper management of practice fees can add significant value.
2. Build a cash-flow analysis. The total value of the dental practice cannot surpass the ability of the practice to produce a large enough cash-flow to service the debt and provide a reasonable profit to the purchasing dentist. The net income of the practice is adjusted to return all income to the dentist as well as benefits to maximize net income. Owner benefits typically consist of all deductions for expenses not related to practice operations, but which were paid to the selling dentist.
3. Maintain your production. Sometimes owner/ doctors will start to slow down before actual retirement. This results in an exponential decline in profit and practice value. It is important to maintain the historic growth rate of the practice until the sale closes.
4. Maintain new patient numbers. Practice acquirers hone in on this data point and consider it to be a true indication of the practice vitality.
5. Get your financial records in order. Typica dental practice profit and loss and income statements fail to give a true practice overhead and profit picture. Ask your accountant to group related expenses together for the purpose of determining true profit. If you own two practices, avoid a co-mingled tax statement.
6. Reinvigorate your recall system. Hygiene income usually comprises 22 to 25 percent of the total income in a typical general practice. This percentage can climb to 30 percent or more in practices aggressively utilizing soft-tissue management procedures. Generally, the higher the hygiene percentage, the better ... unless a situation occurs where the doctor is underproducing, which articially raises the hygiene percentage
7. Review the condition of the dental patient records. Through due diligence process, a purchaser usually will review a representative sample of the patient records. The practice owner should maintain les with total treatment logs, current patient data, and easily understood treatment plans.
8. Clean up clutter and upgrade the office decor. A typical prospective dental purchaser will be reviewing multiple practices. Every attempt should be made to make your dental office stand out in this environment.
9. Improve the dental equipment. Purchasers expect to see modern equipment in the dental practice. The practice owner should keep all equipment updated, from both a use and design function.
10. Do not let the lease lapse. Do not let the lease lapse. Do not let the lease lapse!
11. Examine your dental treatment mix.
12. Emphasize fee-for-service. Dental practice purchasers place a real importance on the fee-for-service component of practice income.
13. Check with your financial and business advisors. Talk with your dental practice transition consultant about a draft dental practice evaluation. - 15437
About the Author:
WB&A is a Dentist and Tax Attorney/Accountant with years of Texas dental practice transitions experience. Backed by in-depth experience, knowledge and credibility essential to making your practice transition seamless and successful. Dental Practice For Sale Houston and Dental Practice For Sale San Antonio
