Buying a dental practice is considered a long-term investment. Thus, it requires thorough diligence from your end. You need to consider factors such as the type of dental practice you will be buying, whether a medical office space available in your preferred location, budget, and more.
According to a market research report, there were about 1,82,418 dental offices in the US. Buying the right office is understandably an overwhelming decision to make. The decision has to be both professionally and financially sound.
The article looks at some precautions that one should adhere to before buying a dental practice.
Precautions to Take When Buying a Dental Practice
Know What Type of Dental Practice You Will be Buying
You must be knowledgeable about the dental space before you buy it. Dentists all over the country specialize in different streams of dentistry. For example, you could buy a dental practice specializing in orthodontics, pediatric dentistry, endodontics, or prosthodontics. There are ones dedicated to cosmetic dentistry as well.
You must understand the type of services offered by the practice before you decide which one to buy.
Get a Practice Valuation Done
Once you have settled on the stream of dentistry and the dental practice you want to buy, seek help from a professional to get a practice valuation done. You need to take a deep dive into the practice’s finances, balance sheets, profit and loss statements, tax, revenue, expenses, and other financial aspects.
One typically buys an established dental practice to get a head start in terms of patients and revenue. However, you need to understand beforehand if the purchase will make financial sense to you as a business.
Take a Real Estate Survey of the Facility
It would be best if you visited the dental facility or let a broker handle the visit to survey the facility’s surroundings. For example, determine if the facility is located at an appropriate location, if there is medical office space available if you wish to scale up in the future, accessibility, and more.
These details could come in handy when negotiating the lease agreement. A consultant could help conduct a real estate survey of the facility and identify any issues before you make the purchase.
Secure Financing to Close the Deal
Once you have found the practice you want to buy and are satisfied with the valuation results, the next step is financing. Many nationalized and regional banks and other financial institutions give out loans for small businesses.
If you are not familiar with the financial aspects of a loan, it is better to work with a consultant who can guide you through the process and help you with documentation, filing, and other requirements.
Seeking the help of consultants experienced in the process of medical and dental acquisitions could place you in a favorable position. The consultants could guide you through the process of practice acquisition, like finding the best medical office space available in your city, conducting real estate and business analysis to ensure you make the right choice, etc.