How Long Does a Dental Practice Sale Take?
Selling your dental practice is an important decision that requires cautious planning and preparation, as well as proper execution. How long the practice sale will take depends on many factors, including your specialty, location, and market demand. Generally speaking, selling a dental practice can take between six to twelve months. Our dental practice sales attorney outlines a general timeline for most transactions below.
Initial Preparation
The initial preparation stage is a very important one. This stage takes approximately one to three months and involves the following:
- Collecting financial records such as profit and loss statements, tax returns, and patient numbers
- Obtaining a practice valuation to determine a reasonable sale price
- Improving the practice’s overall appeal by updating technology or the office’s design
Listing Your Practice
After the initial preparation, it is time to list your practice. To ensure the listing reaches the appropriate audience, you may choose to work with a dental broker. A broker will list your practice on industry websites, professional networks, and other resources to target the right buyers. Your listing should highlight the best features of your practice including location, patient base, and profitability. It should also appeal to specific types of buyers whether they are dental service organizations (DSOs) or individual practitioners. This stage takes approximately three to six months. If you need recommendations for dental brokers in your area, AGS Law works with many dental brokers across the country and can provide some recommendations.
Finding the Right Buyer
Finding the right buyer requires much more than simply verifying their financial qualifications. It involves screening potential buyers to make sure they are aligned with your goals for the business and are a good fit for your existing staff. After identifying a buyer, negotiations will start to establish the sale price, terms of the dental transition, any transition period, and more. Finding the right buyer can take between two to four months or more.
Due Diligence
During the due diligence phase, you and the potential buyer will conduct due diligence to confirm operational and financial details. Your dental practice sales attorney can draft the purchase agreement while the buyer will review compliance with state laws and the practice’s financials. Conducting due diligence typically takes between one to three months.
The Transition Period
The transition period begins once the sale is finalized. During this period, you may work with the new owner to avoid interruptions for key staff members and patients. You may provide clinical or consulting services to the new owner. There may be specific aspects of accounts receivable collections or patient credit reimbursements in which you are required to be involved. The duration of this period depends on the complexity of the practice and the buyer’s preferences. On average, the transition period lasts one to six months.
What Factors Impact the Timeline?
There are many factors that may impact the timeline of your dental practice sale. These include:
- Location: Dental practices in urban and suburban areas typically attract more buyers than those in rural locations.
- Market demand: Specialties that are in high demand, such as orthodontic practices, typically sell faster than general dentistry practices
- Type of buyer: Selling to a DSO or pre-qualified buyer often results in a faster sale
Call Our Dental Practice Sales Attorney Today
Waiting for a sale to be finalized can be very stressful. At AGS Law, our dental practice sales attorney can guide you through the process and help you finalize your sale as quickly as possible while still ensuring your best interests are protected. Call us today at 801-477-6144 or contact us online to schedule a consultation and to get the legal help you need.
