Buy dental practice: what is actually being transferred
- What assembling it costs in your own time
- $2,730
- Hours to assemble the whole pack
- 36
- Hours a week to be ready in time
- 5
Every figure here comes from the figures you enter and the method stated beside it: your document count, your own hourly worth, your expected price. This site publishes no valuation, no tax position and no legal opinion; what a clause means for your deal is your solicitor's and your accountant's.
A dental practice looks like a business with expensive equipment in it and is really a list of people who trust a particular clinician, held under rules about how their records may be handled. A buyer is acquiring the relationships, the team, the premises arrangement and the records obligations, in roughly that order of importance, and the equipment matters mostly as a schedule of what is about to need replacing. This page is what to examine and in what order. It does not price a practice and it is not clinical or legal advice.
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How to buy dental practice goodwill rather than a building
The value is in the active patient list and how much of it is attached to the practice rather than to the departing dentist. Read the active patient count and how it has moved over three years, the recall system and what share of revenue it produces, the payer mix and its concentration, and the treatment mix and its margins. Then ask the question that decides the transition: how many of these patients have ever been seen by somebody other than the seller.
The team and the records are the two things that do not simply transfer
Associates, hygienists and front desk staff each have their own terms and their own reasons to stay or go, and a practice whose team leaves with the seller is worth much less than the schedule suggests. Patient records carry obligations about transfer, notification and retention that are specific to the profession and the state, and they are the item most often left until it becomes a completion problem. Both belong in the first fortnight of diligence, not the last.
Buy dental office premises, or lease them
Whether the building comes with the practice changes the deal entirely. A freehold can be bought, left with the seller and leased back, or sold separately, and each produces a different price for the trading business and a different obligation afterwards. If it is leased, the remaining term, the renewal rights and whether assignment needs consent are a cap on what the practice is worth to anybody, because a practice that may have to move is a patient list that may not follow.
Cost of buying a dental practice: the price is not the number that matters
Budget the price, then the working capital for the first months, the equipment that is already near the end of its life, any compliance or fit out work the premises need, and the professional fees on both sides. Then set the total against what the practice earns after paying a market rate for the clinical work the seller was doing themselves. That last adjustment is the one that turns an attractive multiple into a realistic one, and it is the calculation a lender will run whether or not the buyer does.
How the price is allocated, and why the buyer and seller argue about it
In an asset purchase the price is allocated across the equipment, the premises interest, any restrictive covenant and the goodwill, and the allocation has tax consequences that pull the two sides in opposite directions. The federal rules for allocating a purchase price across acquired assets are at 26 CFR 1.1060-1, and both parties report consistently. Settle the allocation in the agreement rather than after it, because it is a negotiation that gets much harder once the money has moved.
Will it do what you need for Buy dental practice?
Tell us where you are in selling your business and what you are trying to keep track of.
Buy dental practice: common questions
What belongs on a buying a dental practice checklist?
Active patients and the recall report, three years of production by provider and by payer, the payer contracts, the staff list with terms and length of service, the lease or the title, the equipment schedule with ages and service history, the records and how they will transfer, and the seller's own transition commitment in writing. The last item is the one most often agreed verbally and most often disputed.
How long should the seller stay on after completion?
Long enough for the patients to meet whoever is taking over, which in practice usually means months rather than weeks, and the arrangement should be written down with hours, duties and payment. A handover agreed as a handshake is the most common reason an otherwise sound acquisition underperforms in its first year.
Is it better to buy a practice or start one?
An acquisition buys revenue from day one and inherits whatever comes with it. A start up buys none and inherits nothing. The choice is usually decided by how much of the acquired revenue is genuinely transferable, which is the same question that decides the price, so it is worth answering properly before deciding either way.
Exitvo Pro
Keeping what you make
The checklist is free. Pro is what happens once a buyer is actually asking: the documents go in as records, each request is tracked against the person who made it, and every version carries the date it was shared, so nobody has to remember which copy anybody has.
- Download the pack as a file you can send on
- Your packs and indexes without our name on them
- Save the sale file and open it again next week
- Your business name and logo on every pack and index
- Export the whole sale file in one go
- Send a document from inside the file rather than from your inbox
- Take a deposit without leaving the record
- Connect QuickBooks or Xero to your account
$24per month, one sale
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