An ideal way to garner data on any practice you want to buy is by carrying out a comprehensive examination of such business, as you would a patient with a severe dental issue. Stating this examination usually requires asking a series of carefully-structured questions from the seller to get a detailed understanding of what the practice is all about and what you stand to gain from acquiring it.
Below are four pertinent questions you need to ask a potential seller when buying a practice.
1. How Many Active Patients are Currently Registered with the Practice?
An excellent dental CPA in Chicago would tell you that this is one of the most important questions you should ask when acquiring a dental practice. Businesses thrive on the continued patronage of customers. A dental practice, being one, also thrives on the number of active patients it possesses. Many buy dental businesses with the hope of meeting an excellent patient count, only to realize that what they bought isn’t what was advertised or represented in the books.
To avoid such a situation, ensure a potential seller this question and get an unequivocal, well-documented answer. Verify the seller’s claims by finding out the active patient counts and other essential information.
2. Where Is the Location of the Practice?
Location matters when it comes to procuring a dental practice; ask a dental CPA in Chicago. The visibility of your business might be the difference between its success and failure. A strategically-sited enterprise attracts customers or patients, as the case may be. When buying a practice, you want it to be located in an environment where sales will be rapid, not in an obscure location.
So, it’s worth the effort to ensure you end up with a practice in an open and sales-enhancing environment. Ensure the location where the business is situated fits the profile of your target population. You also don’t want a situation where you’d be battling to fend off competitors.
3. How was the Price of the Dental Practice Appraised?
While it’s mostly the responsibility of a dental CPA in Chicago to deal with the appraisal aspect of a practice, it’s a question you must endeavor to ask a potential seller. Ideally, before a seller gets to the point of putting up a sale advert, they’d have already carried out an appraisal of the business.
As a prospective buyer, ensure you get detailed information on the valuation process, the appraiser’s reputation and qualification, and the estimated value of the practice. The valuation report must include details of tax returns, projected income flow, and other essential information.
4. Is the Seller Willing to Stay on and Get You Acquainted with the Business and Patients
Depending on the size of the practice and the number of active patients’ adequacy, there’s always the option of having the seller stay on for a little while after a sale deal has been concluded, provided they’re interested. This option is usually considered to allow the selling dentist to help the buyer settle appropriately into the practice while also introducing them to the patients.
So, once the patient base’s adequacy has been confirmed, you should ask the seller if they’d be willing to stay back for some time.
Buying a practice isn’t one you dabble into without doing your due diligence. Asking the right questions can save you lots of stress and disappointments.