Don’t allow the simplicity of the deal to cost you.
When you’re prepared to sell your medical or dental practice, it’s easy to become overwhelmed trying to manage the sales process while running your practice. It may seem like a simple next step to field a direct offer from groups like Dental Support Organizations (DSOs) because of their streamlined approach to purchasing your practice. The simplicity of having a direct offer on the table may also seem compelling to you as a practitioner because you do not have time to think about how to shop around for the best price.
In this article, we explore what to consider before you say yes to the offer on the table, and whether or not hiring health care practice brokers is right for you.
Bringing in experts can ensure a deal is mutually beneficial.
A buyer’s primary concern is to buy your practice for a price that benefits them financially; however, the best deals are those where both parties benefit. This can be achieved when both sides are well-informed and agree to a fair price.
As a dentist or a doctor considering a partnership, you may be interested in doing so for a number of reasons:
- To take advantage of economies of scale
- To alleviate management burden
- To pursue a better work/life balance
- To create an exit strategy
- To anticipate wealth creation
What’s often overlooked is that DSOs pay their doctor partners high referral fees and spend millions on their business development department. DSOs know this is a complex process with lots of variables, so they spend money on marketing to offer a clear solution and efficient pathway to selling. At the same time, you are likely leaving a lot of money on the table for the seeming convenience.
Here at PTG, we have seen that seeking representation from knowledgeable dental business brokers and medical business brokers offers you a fuller and more accurate view of what your practice is worth.
Health care practice brokers are incentivized when you sell at a good and fair price.
True market valuations take research and time to understand. The job of dental office brokers and medical practice brokers is to take the initial homework off your plate, acting as a guide to figuring out the deal that lines up best with your priorities. It is preferable for you to have your own guide to the market, rather than relying on a buyer to interpret worth.
You should bear in mind that buyers looking to directly purchase practices want to purchase at a discounted price. They have a vested interest in keeping valuations low in order to improve their own company’s bottom line. In contrast, hiring dental business brokers or medical business brokers, who only get paid after the deal is signed, brings structure, knowledge, and momentum to the process, while advocating from your side of the table.
There is proven value in bringing in a professional whose daily work is to evaluate and close deals.
Nobody is an expert the first time they try something. After spending decades building a successful practice, you have become an expert in your field. In the same way, brokers like us at PTG have become experts in pursuing and closing dental and medical M&A deals.
In working with a representative, you are also far more protected. As brokers, we limit risk because we know and live in the landscape of selling and closing deals. We hold the knowledge and provide leverage over DSOs looking to build positive reputations within the industry.
At PTG, our job is to offer a fuller picture of what selling could look like and support you through these complex and often emotional times. Our medical practice brokers have a goal to move you from being a passive recipient of an offer to taking a more active approach in driving the deal to close.