Episode 123 – Should I Sell My Dental Practice? (Part 1)

“Why are you selling? You might be right on the cusp of a really valuable practice.” ~Dr. Bruce B. Baird

I’ve been talking to a lot of dentists in their mid 30s and 40s who are selling their practices. Now it makes sense for people my age to be selling our practices – we are ready for retirement – but it’s concerning to me that we’re seeing this trend of younger dentists selling. I know they are not getting the value their practices merit. 

When they talk to me about their reasons for selling, this is what I’m hearing:

• I’m burned out
• I have a physical problem that is keeping me from practicing clinically
• I’m worried about missing out on this opportunity to sell 
• I love clinical, but I’m struggling with my business

These reasons are so tragic to me, because the answer to these is “I’m going to sell my practice.” The sad truth is if you’re selling for any of these reasons you are not getting the value out of your practice that you should. 

Selling shouldn’t be the answer. All these problems have workable solutions. There are ways to build a profitable business, maximize your practice value, and sell at a time that gives you the financial security you deserve. The problem is, most doctors don’t know they have options. 

I want to see every independent dentist successful. I know with the right effort, thought process, and coaching you can increase your value year over year, no matter your circumstances, so you can get the value from your practice that will support your future. 

So today I am starting a series on the right time to sell your dental practice by exploring:

• Why you want to sell your practice
• What your options are
• Ideas to increase the value of your business

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EPISODE TRANSCRIPT

Dr Bruce Baird
So if it’s a physical ailment or something going on there, then you should consider the opportunity that you have with your practice of potentially bringing in a couple of associate potential partners along those lines. Now, in order to do that, most dentists are going to need help at some point, in what I like to look at is the thought process of getting your business set up like a real true business. And that’s one of the things that productive dentist Academy has been doing for 18 years. So you know if that’s your rare and when we work with several dogs who have had some physical ailments that had precluded them from continuing to practice, so and then we’ve helped grow their business and, and they continue to reap the benefits financially, of having that practice in place. The other option is where a dentist is just unhappy being a dentist, and I can kind of split that out into two different directions.

One is they finally realized when they got out of dental school, that they don’t like doing dentistry. Now, there are a lot of dentists out there that just go associate, you know, I’ve had multiple associates, so I felt like, you know, probably just didn’t enjoy the dental part of it didn’t enjoy dentistry. There are other doctors who have come through productive dentist Academy who has had, you know, they don’t really like the clinical part, but they love the business part. And so they go off on setting up a practice with other dentists working with them. That’s where the small and midsize DSOs come into play where they have somebody who has two or three practices, and that becomes their new mission. And you know, and those are kind of differentiated I mean, they’re the on the one side you have the dentist who doesn’t like dentistry the other that physically can’t do the dentistry. And then you have the dentists who really love dentistry and who really at And there’s an excellent clinical dentist, but just doesn’t have the business skills or the personal skills to be able to grow that business into what I call a legacy practice.

want to pull my hair out. I literally had to learn to speak engineer in order for me to build a successful business. And you know what, I’ve read every book, I did everything I could, I had coaches, I had everything. And I finally feel like I know an engineer needs to have all the information they need. need to have a checklist before they can move forward. But what I want you to know is that 80% of your patients really don’t need that. And so that’s another area where productive dentist Academy really has, when we’ve dedicated 18 years to teach in the non-engineer to speak, the engineer to speak non-engineer. I mean, we really have worked hard at that. And today, productive dentist Academy has changed our focus a little bit, we’ve always, we’re always going to continue to teach communication skills. But what we’re doing now is, and we’ve always taught, let me help you increase your productivity per hour. And that’s what many of you have seen us talking about over and over and over again. And we know how to do that. And that’s actually that’s fairly easy.

Now, we’ve turned our focus into increasing your productivity and increasing the practice value, meaning your EBITA. So, you know, many people, we have doctors coming to us probably 15 offers a month, come to productive dentist Academy, meaning that Dennis has gotten an offer from a DSO, or gotten an offer that somebody wants to buy their practice. And most of the time a DSO is going to come in and look at all of your information, and we willingly give them everything. And we say, Here are my tax returns, here are all of our books, here’s everything. And they tell you what your EBIT is, and then they make an offer, we’re going to give you a 5x multiple of your EBIT, which, that’s great. You know, if the EBIT is correct, and that’s something I’m going to talk about in the next podcast that we do in part two of this because you really need to be ready. The other thing is, what age are you? Are you ready to get out of dentistry? Are you selling because it’s retirement time you’ve done well financially and you want to reap the benefits of that? Great? Are you? Are you worried you’re going to miss out on the DSO, you know, the Firestorm that’s happening?

You’re not going to miss out. So So are you just tired and you’re done? Well, I can’t help people who are tired and you’re done. But what I can do is I can help people who are looking to maximize the value of the investment that they’ve made. Sometimes that’s 10 years, sometimes that’s 40 years when there’s nothing Saturd. And we see these cash on a regular basis, but somebody has worked their entire career. And they’ve put away very little money. And they find out that their practice is worth 400,000 or 500. And that’s not enough to take care of their retirement needs. And so they end up working longer, and they work longer, and they just keep adding year after year without really any intention.

They just don’t know what to do, you know, they’re thinking, Well, I really would like to make this, you know, be able to retire. But that’s why 95% of dentists out there don’t even retire at their pre-retirement Inc, they, you know, they have trouble living at the same level that they lived at, while they were practicing dentistry. And, you know, that’s something that is it’s really tragic. And the other part that’s very sad is it’s easily fixable. And when I say easily fixable, you know, nothing, nothing. Nothing happens without effort. Okay, but with the right amount of effort with the right thought process, with the right coaching with the right team, you can concentrate on doing your dentistry, and your value is going to continue to increase year over year over year. So you know, I’m going to the next part of this, I’m going to talk specifically about EBITA, how we grow EBITA and how that works.

And whether you’re ready to sell or not sell, please reach out to us. And we can give you some ideas to increase the value of your business. Because that ultimately, when when the time runs out in your career, and it does run out, it just kind of happens quickly. You want to be poised and positioned to reap the benefits, the maximum value for your business, and the maximum value for your team members that you’re going to be leaving behind. All of these things are critically important. So again, thank you guys for voting us the number three podcast out of the 69 Dental podcasts that are out there. Please tell your friends about The Productive Dentist Podcast and I look forward to next time.