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How to Value a Dental Practice for Sale

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How to Value a Dental Practice for Sale

Establishing a value can be very perplexing. Each practice, viagra generic  treatment of course, has similar makeup with staffing, equipment, and layout but there are certain characteristics that also need to be considered when establishing value.\nWhen you are looking for value, consider these factors:\n\nLocation, Location, Location\nCertain practice locations can automatically bring in new patients simply because\nthe office is very visible and has good signage. Shopping centers and strip malls\nallow for the best exposure. Although, some practices do well in a professional medical building due to in-house referrals.\n\nGross Income\nYes, there are many formulas and multiples for establishing goodwill that have been\nutilized for a long time. It is very important to analyze if the practice is showing growth and\nif not, is it a permanent situation due to factors not controllable (ie economy). By acquiring\nseveral years of financial information will allow you to do a comparable study over the last\nthree years.\n\nTransition Period\nDependent upon the exit strategy of the seller, the transition period will differ.\nIf the seller stays longer than one month, patients may become confused and\nstill desire to see the seller. There are ways to overcome this however.\n\nKey Personnel\nMost practices have one or more key personnel that would be instrumental\nin maintaining the comfort level to the patients and more importantly the\ncontinuity needed in transferring a practice. Be careful though, as some practices\nare overstaffed and some staff members overpaid.\n\nGoodwill\nEncompasses several avenues of value and can be applied to many of the above topics.\nIt is important that the practice have a good reputation and established for several\nyears to validate the patterns necessary for success.\n\nOther Factors\nYes, of course there are other factors; such as profit ratio, transfer-ability, lease arrangements, etc all of which require a full on analysis.

One Comment so far:

  1. Johnetta says:

    Surpiisrng to think of something like that

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