Orthotown April 2020 - 63

by Dr. Tom Snyder

For most practice owners, their practice is their most valuable incomegenerating asset. So when it comes time to sell, "doing it right" is essential
to maximize the return on a career's worth of effort.
Experts place a premium on proper transition and financial planning, which
become even more important when, as part of your long-term financial plan,
you'll supplement your retirement income with the practice's sale proceeds.
This fact is supported by the statistic that the average retirement age of
dentists, according to the ADA Healthy Policy, has increased to 68.9 years!
The longer the timeline between now and your intended date to sell, the
better the chance you have to achieve a more successful financial outcome.
According to the ADA Retirement Survey, more than 55% of respondents
who sold their dental practice said they found it somewhat or very difficult
to sell. This is no small surprise; there are a multitude of tasks and steps that
must be undertaken to increase the odds for a successful outcome. Selling your
practice on your own can be a daunting and potentially overwhelming process!
To help prepare you, here's a comprehensive pathway and timeline for
you to consider. Hopefully, this information will enlighten and guide you
to a successful practice transition.

Tom Snyder, DMD, MBA,
the senior director of
transition services at Henry
Schein Professional Practice
Transitions, is a nationally
recognized speaker, author
and consultant who has been
advising dentists for more than
30 years in dental practice
strategic planning, practice
valuations and dental partnership formation. Snyder is a
faculty member at the University of Pennsylvania School
of Dental Medicine and a former department chair at the
University of Maryland School of Dentistry. He also serves
on the editorial boards of several national publications. He
is a graduate of the University of Pennsylvania School of
Dental Medicine and earned an MBA from the University of
Pennsylvania Wharton School of Business.

5-10 years before the sale
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Meet with a transition specialist for a session to discuss and map out
your perfect plan.
Determine how much longer you want to remain a practice owner.
How long would you ideally like to continue treating patients?
Do you want to continue to work at the practice after the sale?
If so, for how long?
Consider the different types of transition options:
1. Outright sale into retirement.
2. Role-reversal sale, where you sell to your associate.
3. Sale of partial interest, bringing you into a partnership on an
interim basis until you sell the complete interest to that partner
or a third party (must be willing to engage a partner).
4. Sale to a DSO or group practice network. Not "one size fits all,"
but be prepared to remain in practice at the location for
a specified time after the deal closes.
Compile all associate employment agreements and confirm
that your restrictive covenants are sufficient to protect your
business interests.
Meet with your financial adviser to determine the required
asset goal so you can retire.

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Orthotown April 2020

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