By Philip Kempler, DMD, Broker
Thomas & Fees Practice Sales
“Why do you want to sell your practice?”
That’s the first question I ask when I meet with a prospective client. It’s important because many times the client is not selling for the right reason. Selling the practice is a permanent solution while the reason may be temporary. Maybe the dentist is just burned out or is experiencing personal issues or stress that can be resolved. And if the problems could be resolved, selling the practice would be a total mistake. A good Broker will help a prospective client explore alternatives, like bringing in an associate or cutting back the hours worked, before taking a listing on the practice.
On the other hand, there are reasons why it might be the right time to sell the practice. Perhaps you have a physical or mental impairment that is preventing the delivery of dental care. Or perhaps you have the financial ability to retire and want freedom to explore other interests.
When it’s time to sell, there will be emotional aspects to deal with.
Let’s assume, for the purpose of this article, that the reasons are right and it’s time to sell your practice. Hopefully, you’ve found an excellent Broker to assist you in the sale. If the Broker does his job, the sale should go smoothly and you and your Broker will be working as partners. Your Broker should prepare you for what to expect. However, even the best Broker can’t prepare you for the emotional aspects of selling your practice.
Let’s divide the emotional aspects into three different categories.
First and foremost is handling the staff during the sale.
If you are like most dentists, your staff is like family. If they are kept out of negotiations and are left in the dark about the sale (which happens 98% of the time), it can be quite a shock. We have seen employees openly weep. Sometimes I’m not sure if they might not be tears of joy. Just kidding! Unlike many typical businesses, the dentist often has a close relationship with staff members and may consider them his or her best friends. After working all day with the same face 4 or 5 times a week for many years, it is quite a change to not see them anymore. So it may sound cruel to keep the staff out of the selling loop, but, it is actually best for all concerned.
When you finally do sit down with employees to break the news, it is best to be upbeat and honest. Explain your reasons for the sale, if appropriate, and tell the staff that you have full confidence that they will do right by the new practice owner. Thank them for their service and be sure to tell the new dentist that he’s lucky to have such a talented and trustworthy staff work at his practice. Be prepared to answer their questions, as your employees will likely have many concerns about how new ownership will impact them. And be ready. Emotions may arise and you’ll need to be prepared to handle them.
Second is closing the book on your practice and moving on.
If you stick around the practice for a while to help staff and patients adjust, you’ll find it difficult to “butt out’ as the new owner puts his plans of operation into place. After all, it’s been your “baby” all these years. You’ll find yourself questioning his decisions and thinking, “This new guy doesn’t know what he’s doing. Why is he doing his own endo? I always referred it out.” Or , “What’s the big idea of using a payroll service? My wife always came in and did payroll.” It’s important that you move on. If you can’t, then maybe you shouldn’t have sold your practice.
Third, what are you going to do once you sell your practice?
Having a plan in place prior to the sale is critically important. If you are one of the very few Sellers that has truly though out your future and has a master plan and the finances in place to embark on a new adventure or career, you’ll do just fine. But if you are like most, you will feel a void in your life for a while and have the desire or need to return to practice.
It takes time to adjust to a new life and it can be done. But, if you want your future to be as happy as your career, you need to start planning. Maybe you want to travel to all those places you didn’t have the time to go to while you were practicing dentistry. Or perhaps now you can finally work on that golf game. Or perhaps starting that little business that you and your wife have talked about for the last 20 years?
The emotional considerations I just laid out should be discussed with your Broker, family, and financial advisor well before listing your practice for sale. Why you are selling and what kind of life you want and can afford to live, must be decided prior to selling your practice. It may just make you change your mind before it is too late.