What dental trends should you be aware of as a dental practice owner? When you own a small business, planning for retirement involves much more than putting aside money in a retirement account. Knowing the trends in dentist retirement is an important first step before putting your dental practice for sale. New statistics from the ADA serve as an important signpost on the road to retirement.
ADA Statistics and Retirement Trends
The ADA recently released statistics from a Dental Workforce study showing that as of 2015 the average age of dentists in the United States was 50 years old. This statistic reveals that most dentists will reach retirement age in the next 5-10 years. Knowing that the market for dental practices is likely to be flooded soon, it is beneficial to start planning and strategizing today for your retirement, so you don’t put your practice on the market at the wrong time. Your dental practice may be worth more today than in 5 years when more dentists decide to put their dental practice for sale.
Questions and Concerns About Retirement
Below we address some of the most common questions and concerns dental practice owners have when thinking about retirement. Even if you aren’t planning on retiring soon, it is a good idea to think through these questions and have a game plan for the next 5-10 years.
What is my practice worth?
Finding your practice’s value is a complex process. A general rule of thumb for valuations can be applied, but these estimations can often be inaccurate. Your best method for finding how much your practice is worth is talking to a dental broker. Brokers specialize in these transitions and know what market factors will play into your practice’s value. The experts at DDSmatch Southwest will help you determine your local market rate so you can make the most out of your practice.
Should I add an associate?
Often dentists will choose a slow transition out of their practice by adding an associate who will eventually take over the practice. This is a good idea for dentists who don’t want to put their dental practice for sale right now but want to cut back on hours and maintain a foot in the door. DDSmatch Southwest can help you find the perfect associate, whether you are planning for retirement or just want a little help.
Should I sell to a DSO?
A Dental Service Organization, or DSO, manages the non-clinical side of a dental practice. Deciding if you want to sell to a DSO is a personal decision. A DSO will relieve the headache of managing the business side of a dental practice and could make working in your practice more attractive for potential associates. However, many dentists who have built their business from the ground up, find it difficult to think of their practice changing due to a DSO’s management. To learn more about the recent rise of DSOs and the benefits they may provide read this piece by Dental Money Digest source.
How do I find the right buyer?
If you do not sell your practice to a DSO, how do you find the right buyer? DDSmatch Southwest helps dentists in Texas and New Mexico find the perfect buyer for their dental practice. The brokers at DDSmatch Southwest will use our Trusted Transition Process™ to determining your wants and needs and decide how much your practice is worth. Then they will find a buyer that matches the skill set and personality of your office. Before you put your dental practice for sale, call the experienced brokers at DDSmatch Southwest for a consultation.
What should I do to prepare for retirement?
If you’re planning on retiring in the next 3-5 years, it is time to start planning now. Talk to a financial advisor to determine if you have enough set aside to retire. Dental Economics has an excellent post about planning for retirement to retire on time. Next, find an experienced broker to help you with the transition into retirement. A broker will guide you seamlessly through the next steps, so the years leading to retirement are a breeze.
What about my real estate?
When you put your dental practice for sale, that does not automatically include the real estate where your office is located. If you own the real estate, you will need to sell that as well. The process is not difficult but may change who ends up as a potential buyer since they need financing for both the practice and the real estate. The good news is both parts of the transaction can often be closed at the same time. Another option is selling the dental practice but keeping the real estate and becoming a landlord. This post goes into more detail what options are available to buyers and sellers in this type of transaction. Talk with your broker about which option fits your lifestyle and your budget.
Do I sell now to get maximum value or wait?
This question can only be answered on a case by case basis since the values and trends of dental practices vary. However, based on the above statistics from the ADA, putting your dental practice for sale before the market floods will help you get the maximum value. Talk to an experienced dental broker with knowledge of the local market and they will be able to advise you whether to sell now or wait.
I have a partner who won’t buy me out, what do I do?
Partnerships in dental practices can be beneficial for many reasons but tend to get mucky when there is a transition, and you don’t see eye to eye. DDSmatch Southwest helps dentists who are selling their ownership, even if it is a part ownership. We find buyers who are specifically looking to buy into a partnership, so everyone ends up with what they want. For more information on how this process works, and to find the answers to more specific legal questions that may apply to you, set up a consultation today.
How do I find someone I can trust to help?
This is by far the most important question you can ask before you put your dental practice for sale. You have spent your career building a thriving practice, and now you need to get the most out of its sale while leaving the kind of legacy you want. A dental broker with local experience, many years in the business, and proven examples of successful transitions is what you want. For dentists in Texas and New Mexico that broker is DDSmatch Southwest. The brokers at DDSmatch Southwest will take care of every detail and guide you through the transition process so you can retire with confidence.
Think Ahead about Putting Your Dental Practice for Sale
If there is a chance you will be retiring in the next 5-10 years, keep the above statistics and questions in mind. If you start planning now, you can ensure a smooth transition when the time comes. For more information contact DDSmatch Southwest and set up a consultation.