Any one have a current formula for practice transition from solo practice to partnership buy out? Without to much detail it is difficult to assess I know. For a dental practice or any business is there a 1x gross or net. Just curious if there might be some out there in the process of acquiring a practice. Thanks
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partnerships?
Started by drhill
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I guess I don't understand your question. Are you buying in to form a partnership, or are you and someone else buying out a dentist? Regardless, the first thing typically done is a valuation, all kinds of different ways to value a practice, suggest you use a dental accountant. Look up Tim Lott in dentaltown. statistics say 60 to 70 gross as a benchmark, or 1.5 - 2 x net profit. Probably want a 3 year weighted on the most recent year's average.
The actual transaction is another can of worms. From buying assets and goodwill to stock (avoid). Again, best advice, seek and experienced DENTAL accountant.
The actual transaction is another can of worms. From buying assets and goodwill to stock (avoid). Again, best advice, seek and experienced DENTAL accountant.
I'm having trouble understanding your intentions as well but some good advice -- The only ship that won't sail is a partnership.
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Check out all his posts, but keep in mind, a practice is worth whatever you can agree on. If no one can agree, then nothing gets done.
Thanks for the help and the referral. To clarify, I have a solo practice, I would like to take a younger partner and transition out of the practice to retire in 5yr - 7yr. I have seen percentages of net or gross etc. but have not seen a typical standard. Maybe there is not one, but many and creative ways of valuing a practice. Thanks for the dental accountant reference.
