buying a dental practice checklist

Whether you are buying a dental practice, starting a dental practice from scratch, or looking to sell your dental practice, there are many things to keep in mind. When you own a dental practice, you need to be an expert clinician, expert patient manager, and expert business manager. Buyers Checklist. After all, you must work your way through a seemingly endless set of documentation, from the purchase agreement to equipment leases, to ensure that you get a fair deal. Disclaimer: These materials are intended to When starting a business, you must be prepared. Let's say practice "A" has a profit of $241,000, practice "B" has a profit of $192,000, and practice "C" has a profit of $164,000. Research Phase The first step is to research available practices in the area you would like to serve. You have worked hard to build a thriving dental practice and are on the brink of finally selling it or you are about to take the plunge and buy your own dental practice, so what do you need to do to make the process a success? Here is a checklist to keep you on track when buying a dental practice. You’ve worked your tail off to get in to and finish dental school. Buying or selling one is even more complex! You and your dental attorney will then go over the agreement together to make sure that you understand all of the details. With these 20 steps, our brokers are confident you will have the right tools to evaluate, make and offer, and close on your new dental practice. H. t So…you either sell soon, which should be an option for you dentists who are presently on the fence, hanging on, or Make appointments to go see each practice and speak with those in charge. Meet with the employees to explain how the transfer will affect them. Obtain Federal I.D. 1. Get your FREE. Odds are you have worked hard as an employee or associate somewhere before owning your practice. Learning How To Buy A Dental Practice. Buying a Dental practice is one of the major financial decisions and a turning point in a dentist’s career. Also include your letter of pre-approval, as well as your resume or CV and letters of reference. Decide which dental insurance carriers you will accept, and file the appropriate forms. For a smooth transaction, you need an experienced adviser who can foresee potentially problematic issues and negotiate in advance an understanding that will satisfy both parties and avoid costly disputes. With that said, the seller should notify the landlord of his or her intent to sell the practice as early as possible and verify that the landlord will consent to your assumption of the lease. Buying an existing practice gives the buying dentist immediate access to an established patient base, which (if done right) can translates into instant cash flow. Read more about launching a new practice. Your Southern California Dental Practice transitions experts at First Choice Practice Sales have developed a 20 step dental practice buying guide! 1. It is imperative that you understand all aspects of the practice and are comfortable with your new practice. The process of evaluating a dental practice acquisition opportunity is often referred to as “due diligence”. Buying a dental practice is a big decision. Here's my checklist of things to consider. If you’re planning to buy a dental practice, you need to make sure you don’t neglect any critical steps so that you ensure a successful sale and transition. If the real estate is included in the sale, then you and your advisers will need to negotiate the terms of the real estate purchase agreement. It will typically be provided by the seller’s attorney and reviewed by your own dental attorney to make sure that the terms are fair. Select a dental lab. If the lease is at the end of its term (or if the seller is the landlord), you and your advisers will need to negotiate a new lease, bearing in mind that the term of this lease must be equal in length to that of your purchase loan. Whether you’re ready to buy a general dental practice or just beginning to investigate your transition options, call today, 1-800-988-5674, or contact us online to schedule a free 30-minute consultation with an experienced consultant at Henry Schein PPT. Phil represents dentists in business transactions and situations encountered during the life of their practices. You’ve had a long road to get to where you are! This will also be someone who specializes in managing dental practice transitions and who, if needed, can advise you on aspects of running a dental practice such as: As with the other specialized advisers on this list, a lender who specializes in lending to dental professionals will better understand your needs. This checklist and related resources can be used as a starting point to address many of the issues dentists encounter when opening new practices. Review the appointment book and contact any patients whose appointments need to be changed. The process of evaluating a dental practice acquisition opportunity is often referred to as “due diligence”. It’s important to perform detailed research and include all financial information in your business plan. Buyers Checklist. Buying a dental practice is a big deal! Immediately after signing the sales contract, determine how long you will need to get the office reopened. Comprehensive Practice Purchase Checklist – See Every Step You’ll Need to Take before Day 1 as the Boss! The first step is to research available practices in the area you would like to serve. Also, experienced advisors will have useful advice on this subject. Your attorney can help you determine what documentation you need. Dental Service Organization Trends for 2019…. Based on what someone they trust (but who knows nothing about dentistry) learned in one course of marketing. Considering the purchase of a dental practice. A term sheet is also called a letter of intent (LOI), and a memo of understanding (MOU). There is a convenient checklist dentists can use if they're thinking of making the big move to buy their own dental practice. 5 Steps to Selling a Dental Practice; Create my Buyer Profile; Services. Anthony Bareno, Provisionally Licensed Lawyer, Transition Consultant (the buying dentist’s adviser), Securely transferring patient records, as well as, The purchase and collection of accounts receivable (AR), What assets are to be included in the sale, What assets will be excluded from the sale, A signed Dental Practice Purchase and Sale Agreement, A signed lease agreement or assignment (with a term equal to length of loan), Corporate documents, including articles of incorporation and tax ID number, The seller and buyer’s respective representations and warranties, The assets that are included (or excluded) in the sale, The scope of the non-compete covenant (time and geographic distance), The collecting of the seller’s accounts receivable and patient credits, Allocation of the purchase price for tax purposes, Ongoing contractual obligations or liabilities, The transition letter notifying patients that the practice has been sold, Promote your dental experience and background, Express the confidence the previous owner has in you as the new owner. Buying a dental practice is a big deal! Order new equipment if needed. Pre-Contract. Checklist Before Buying Dental Instruments Online. Growing his practices from 1 to 14 during his career, he’s learned what works and what doesn’t. This will minimize disruptions and help your new practice start off on the right foot. An inexperienced attorney can slow down the acquisition process and/or expose you to unnecessary liability after the purchase has been made. Assess the practice’s regulatory compliance status. Buy-in — With this type of sale, you would buy in for 25 to 50% and buy the rest of the practice when the seller decides to retire. You will then have plenty of time to compare quotes and secure the various insurance policies without having to delay your closing date. Even if its not through us! To ensure you do not miss anything, we created a checklist for whichever scenario best suites your situation. In addition, the paperwork requirements are significant, requiring a great deal of time and effort. No assumption of liabilities? So, after finding a practice to buy, the first step is to gather the following team of specialized advisers: These professionals will initially help you review the practice prospectus and point out any possible red flags. In California, you are allowed to set up your practices as either a sole proprietorship, a partnership (with another dentist), or as a professional corporation. Examine the existing equipment and make note of anything you would like to upgrade or change. This article will help identify the key issues to watch out for during your purchase. John Grant, joint founding director at Goodman Grant, sets out the most important considerations when purchasing a new dental practice… Buying a dental practice is no mean feat. Dental Practice Transition Checklist: Making a Smooth Transition. Due diligence is an essential part of purchasing a practice, as it allows the buying dentist to fully examine the seller’s practice and confirm the material facts provided by the seller or practice broker. With these 20 steps, our brokers are confident you will have the right tools to evaluate, make and offer, and close on your new dental practice. Moreover, every bank has its own set of conditions and documents that you will be required to provide in order to obtain funding. Dental-specific lenders are more flexible and may grant you a loan with less collateral and high student loans. The ADA sells a booklet called "Valuing a Dental Practice." A fair offer shows respect and will be seriously considered, while a lowball offer may cause the dentist to move on to the next offer without negotiating. Take the time to explore multiple options for each of the items covered below. What else is on this helpful checklist? Accounts receivable Listing of participating insurance programs. Order business cards, prescription pads, stationery, and other branded products. Contract negotiation 4. This starts with the buyer and the seller being brought together, usually by a Business Agent. Even the most experienced general business attorney may unfamiliar with the dental industry’s legal standards and conventions. He or she has worked very hard to build the practice and form relationships with both the staff and the patients. Not only does transitioning a practice include the financial challenges but the emotional and relational ones as well. If you are interested in purchasing a practice, reach out to our team of experienced dental attorneys at 858-869-1114 for a free consultation, or visit us online to schedule an appointment. Buying a dental practice can be exciting, but you want to make sure you start your business off on the right foot. Do they all have the same value? Over that same 10 year time frame the Dental Schools plan on graduating only 45,871 new dentists, leaving a shortfall of over 3,500 new dentists. Dr. Kevin Coughlin is an expert on the business of dentistry. Decide how payroll will be handled. A business plan is a detailed description of your business. With a completely … The seller will present the buyer with a few key facts about the dental practice such as: … So, at this point, you and the seller may need to hold a joint meeting with his or her staff to introduce you as the new owner and to field any questions they may have. It is extremely important to consult with professionals that know what they are doing. Due-diligence 3. Buying a dental practice can be exciting, but you want to make sure you start your business off on the right foot. Many dentists choose to buy an established dental practice for the existing patients, but having plenty of patients is no guarantee of success. Are you a recent dental school grad, associate, or just looking to expand your current practice? Set up your accounting system. This is actually more recommended by a lot of people. The lender will work closely with your other advisers to make sure that everything is submitted and the practice will close on time. December 13, 2019 / by kck / in Dental Instruments. By Matt Dickstein . This checklist and related resources can be used as a starting point to address many of the issues dentists encounter when opening new practices. As soon as the purchase has been finalized a transition letter should be mailed out to all active patients and referral sources. There are a lot of moving parts that need to come together at the right time in order for the acquisition to be successful. After you and your advisers are comfortable with the practice’s prospectus, the next step is to submit a signed letter of intent to the selling dentist. You might also choose to add a business coach, a partner, and other professionals who can help make your transition as smooth as possible. PURCHASING A DENTAL PRACTICE: DUE DILIGENCE CHECKLIST© Financial Records Tax returns (personal/corporate) for last three years. In addition, you will need to set up a business bank account if you do not already have one. However, if your closing date is near and you are pressed for time, you can expedite your filing. Due-diligence 3. A subsidiary of Henry Schein, Inc. they provide expert guidance for selling and buying dental practices, assessing partnership and associateship opportunities and performing dental practice … Although you are buying an existing practice, it is important to adjust it to your needs and goals. With your lawyer, go through the sales contract with a fine-tooth comb. 8/28/2017 1:37:50 PM | Comments: 0 ... Views: 470 Transitioning a dental practice is an intricate process, and can seem overwhelming if you are approaching or going through the process. Minimize Risks: We’ll help you avoid expensive $100,000 traps hidden in your dental office lease. Presenting a letter of pre-approval reassures the seller that you are serious and minimizes the risk of the deal falling through, which can help move yours ahead of offers from other dentists without pre-approval. It is not uncommon for a commercial lease to require the landlord’s written consent prior to any assignment. Price and payment terms? Profit/loss for last three years. Buying; Buying Basics; Buyer's Checklist; Non-Disclosure Form; Resources; Loan Calculator; Practice Continuity Planning; Ask the Experts; Acquisitions & Mergers; Blog; Our Difference; Our Story ; Testimonials; Our Team; Careers; Careers; Contact; 678-482-7305; View Dental Practices For Sale Looking to Sell Your Practice? Ask for clarification on any clauses that you don’t understand. Here is a checklist to keep you on track when buying a dental practice. There are four key stages in buying or selling a Dental Practice. Henry Schein Professional Practice Transitions, Inc. is a national leader in dental practice transitions. Buying a dental practice is complicated, but the rewards can be significant. Creating your own dental checklists. He or she will then be able to spot any discrepancies in the seller’s books when conducting the financial due diligence. For more information, contact your state dental society. Ascent Dental Solutions is dedicated to helping dentists build their practices. Pre-contract 2. Buyer Representation; Seller Representation; Complete Consulting; Practice Appraisals; Lease vs Buy Analysis; Lease Renegotiation for Your Dental Practice; Dental Practice Financing; Employment Contracts; Associate Search/Contract; Legal Services; Quarterly Performance Review; New Start Ups; Relocation Therefore, it is important that you start the pre-qualification process early on so that you can secure funding in time to meet your negotiated closing date. Stay Organized with a Transition Checklist and Timeline for Selling or Buying a Dental Practice . Checklist: Letter of Intent to purchase a dental practice. Whether you are newly out of dental school or have been running your own practice for years, buying a dental practice is a huge commitment. The first step to opening a dental practice is creating a business plan. Dentistry undergoes continuous development in the medical world. Exchange and completion. Dental school only provides you the tools for two-thirds of what it takes to run a successful office. Talk to the staff. In the third of his series on buying a practice, Jon Drysdale considers the legal aspects of the purchase. New Dentists Toolkit. If you’re opening a new dental practice, there are many things to consider, including licenses, local requirements, supplies, insurance, infection control and OSHA, just to name a few.This checklist and related resources can be used as a starting point to address many of the issues dentists encounter when opening new practices. Interested in learning from a Dental Practice Sales veteran? Hire a Team of Experts – Buying a dental practice is a complex undertaking. Once you have narrowed down your list to the ideal practice for you, it is time to build your team. Learning How To Buy A Dental Practice. Many banks have professional practice lending departments and loan officers to help you navigate the application and underwriting process. There are plenty of equipment and tools used in dental practice. Setting up your practice as a professional corporation in California normally takes you 2-4 weeks, depending on how long it takes the Secretary of State’s office to process your documents. Pre-Contract. With so much going on, it is easy to overlook some very important steps. If you are buying an existing dental practice, odds are high that the business side of the transaction is uppermost in your mind. We have created a guideline of items to ask the Broker and the selling dentist during the due diligence period. Dental Practice Transition Checklist: What To Know. 1. After you and the seller have agreed on all of the terms of the purchase, you will meet and sign all of the agreements. Now, onto your 'buying your dental practice checklist'. Hiring a Dentist: Employee or Independent Contractor? If you are assuming equipment leases, contact the lease companies for the proper assumption documents. The Key Stages in Buying or Selling a Dental Practice. Sample Practice Purchase Timeline – See How Long the Major Steps in a Transition Take. By, setting up your practice as a professional corporation, you can limit your personal liability and take advantage beneficial tax treatment. The first step is to research available practices in the area you would like to serve. Have you thought about buying a dental practice but don’t know where to start? In a different location. Buying an existing practice can give you a perspective on the business operations that a … Too many dentists try to open a dental practice based on bad advice. You will likely need to incorporate, buy shares of a Dentistry Professional Corporation (DPC), have debt structuring to consider, staff and a landlord to deal with, and have diligence to undertake. In practice, decoupling and understanding … To limit your risk, you need a checklist with just two … and the ask price of the puts. The letter of intent makes sure the buyer and the seller agree … Some of the action items below involve financial planning. If you've got any questions about buying a good dental practice, be sure to connect with me on the phone, through email or social media! Buying a new dental practice? When buying a dental practice, how do you know what to do after signing the letter of intent? It should be part of your practice purchase planning. A signed lease agreement or assignment (with a term equal to length of loan) Corporate documents, including articles of incorporation and tax ID number. BUYING A PRACTICE. Include seller’s letter to his patients, with Buyer’s approval. This living document will include your business strategy, standard operating procedures, costs, earnings, and other financial information. Send a letter to your own existing patient list, if applicable, to let them know of your new location. The Practice Purchase Agreement is the contract that defines all of the terms of the purchase. Make appointments to go see each practice and speak with those in charge. Learn as much as you can about the practice’s current financials. BUYING A PRACTICE. Almost always, there is a period of time between when you’ve negotiated the letter of intent and when you walk through the front doors of your new practice, keys in hand, as the brand new owner. The Official Checklist for Buying a Dental Practice (Infographic) 1. Registrati e fai offerte sui lavori gratuitamente. Ideally these matters should be dealt with early in the purchase process. Here are some tips to help ensure your checklists cover all the bases: Keep it … Here is a short list of some of the most common documents that banks requests in the underwriting process: The landlord, selling dentist, and the lending institution may all require you to obtain a variety of insurance policies to secure your practice and your ability to fulfill your obligations to them. What’s on your mind? Outlined below is checklist of some of the legal matters to consider when purchasing a dental practice. We have created a guideline of items to ask the Broker and the selling dentist during the due diligence period. In general, expect to file paperwork with the state board, the IRS and state tax commission, any dental societies to which you belong or plan to join, and the unemployment office. Get answers and invaluable advice about achieving your goal of buying your general dental practice. Research Phase The first step is to research available practices in the area you would like to serve. Each state and territory has slightly different requirements for buying a dental practice. Remember that you are not buying an inanimate object. Starting a New Dental Practice Checklist. The ADA sells a booklet called "Valuing a Dental Practice." It can be quite overwhelming with a lot of factors to consider before acquiring your own dental practice. A helpful check-list for buying and selling a dental practice 11 September 2016 by Leah Groves. Click on a heading for more articles ⇒ In this article, I explain term sheets for the buying or selling of a dental practice. There are four key stages in buying or selling a Dental Practice. 1) Submit a LOI to the seller The first and foremost step towards buying a dental practice is the letter of intent (LOI). PURCHASING A DENTAL PRACTICE: DUE DILIGENCE CHECKLIST© Financial Records Tax returns (personal/corporate) ... Any reason they know of not to buy the practice Seller's Staff What longevity of staff ... or dental equipment Get copy of Office Lease Is the dental office in OSHA compliance THE GOLDMAN LAW FIRM, 55 TIBURON, CA 94920 The transition letter should inform the practice’s active patients and referral sources that the practice has been sold and present you as the new owner. Buying a dental practice can be one of the most important milestones in a dentist’s career. If you continue to use this site we will assume that you are happy with it. Find out how many regular patients are currently on the books. The WHO checklist is a good starting point for developing your dental practice’s checklists. For a successful transaction, it is important to set up clear and detailed expectations. With a different patient population. 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