How to Increase Your Dental or Medical Practice Selling Price

Selling a dental or medical practice can be a complex and challenging process, but with careful planning and execution, you can maximise its selling value and ensure a successful sale. Here we go over some possible strategies to consider when preparing to sell a dental or medical practice:  

1. Prepare Financial Documents 

Ensure your financial records are accurate, up-to-date, and well-organised. This includes income statements, balance sheets, tax returns, and any other relevant financial documents. Well-prepared financials demonstrate efficiency and stability and can increase buyer confidence, leading to possible higher offers from buyers. Accountants, Valuers, Finance companies and Business Brokers will all want and need up-to-date accurate and well-prepared documentation available to potential purchasers.  

These can include:  

  • Profit and loss statements for 2-3 years before sale and current situation. 
  • BAS statements and tax returns for 2-3 years  
  • Equipment lists with branding details, warranty records and any maintenance documentation.  
  • Any leasing or hire purchase and details of equipment, which includes pay-out figures and any finance details.  
  • The Lease details of buildings and premises and managing agent or landlord details if rented. Current rental and optional terms  
  • Patient Fees and fee structure. Details of health insurance agreements or if the clinic is bulk billed, private billing or both. 
  • Supplier agreements for reusables and other stock 
  • Any staff contracts and staff details. Details of pay rates leave entitlements, long service, superannuation, Workcover details.  
  • All stock levels.  
  • Client lists if privacy laws allow for this  

Professionals are aware of the impact of the pandemic on dental practices and their revenue figures. 

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2. Showcase Growth Potential of the practice  

Highlight the growth potential of your practice to prospective buyers. This could include new treatments, the potential for more clinicians to work at the clinic, product or service expansions, or opportunities for cost savings and practice running efficiency improvements. Demonstrating a clear path for future growth can make your practice more attractive and increase its selling value. Practices that display upward financial and revenue growth obviously will be more attractive to potential purchasers.  

3. Strengthen Patient Relationships: 

Invest in maintaining and strengthening client relationships leading up to the sale. Loyal patients can significantly enhance the value of your business by providing recurring revenue through effective recall systems and positive referrals. Highlighting a strong patient base can make your business more appealing to potential buyers. 

4. Enhance Brand Reputation: 

Invest in branding efforts to enhance the reputation and visibility of your practice. This could include improving your online presence, implementing marketing campaigns, or participating in industry events. A strong brand can command higher selling prices and attract more interested buyers. 

5.Streamline and Optimize Operations: 

Streamline your operations to improve efficiency and reduce costs. This could involve automating processes, renegotiating contracts with suppliers, or implementing new technologies. Clinical software for patients, staffing software and ordering stock software management should be efficient and up-to-date. A well-run clinic with efficient operations is more valuable to buyers and can demand higher selling prices. Potential purchasers will find streamlined management systems and IT a big feature when weighing up purchases. 

6.  Employee Development 

Invest in employee training and professional development to display a skilled and motivated workforce, adding value to the business. New purchasers will value well-trained and educated assistants and admin staff highly. 

7 Update your medical or dental practice.  

A. Updating the practice premises can significantly enhance its appeal to potential buyers. Simple changes like fresh paint, modern fixtures, and landscaping can make a big difference. Investing in improvements shows buyers that you care about the property and can increase its perceived value, leading to higher offers. The more attractive clinics leave positive feedback which can be the difference between one practice and another. 

B. Updating Equipment. Many purchasers who are less experienced practitioners that are purchasing a Medical or Dental clinic will expect reasonably up-to-date equipment. Leading-edge equipment will make the practice more appealing and help to again increase sale value.  

8. Seek Professional Guidance: 

Consider working with experienced professionals, such as specialised business broker to oversee the sale process. Specialised lawyers, or accountants that are familiar with medical and dental practice sales are required and invaluable to help guide you through the selling process. They can provide valuable advice, help negotiate deals, and ensure all legal and financial aspects are handled properly. 

By implementing these strategies, you can maximise the selling value of your practice and achieve a successful sale in the market. It’s essential to plan, focus on key areas of improvement, and seek professional assistance when needed to ensure a smooth and profitable transaction. 

Selling your clinic can seem a very large and daunting process but with careful planning and some expert help from professionals and business brokers, sellers will be better prepared to ensure that the medical or dental practice is better placed and prepared for a smooth and successful sale process. 

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