What Exactly Is A Dental Practice Transition?
The dental industry has a wide range of terminology which is typically unfamiliar to many people outside the industry itself. In fact, there are some terms that often confuse even those within the dental industry, leaving them seeking the help of professionals who can answer their questions and make buying a dental practice, selling a dental practice, or getting a dental practice valuation a lot more manageable. One such term–arguably, one of the most misunderstood phrases in the world of dentistry–is “practice transition”.
If you ask a group of dentists what they think when they hear the term “practice transition,” many will say retirement, selling a dental practice, or dental broker.
Regardless of the reasons for selling a dental practice, there will always be a need for specialists who can broker the sale. However, there is a conceptual difference between the immediate straight sale of a dental practice and the actual practice transition.
What Is A True Practice Transition?
A practice transition can be best defined as ‘the comprehensive and systematic process of incorporating another provider into your practice with the mutual intent being to eventually either share or transfer ownership of the business at an agreed-upon point in the future.’ That might seem a bit confusing at first, but it really is a straight forward process.
During a "straight sale", a dental practice transition is typically executed as a practice growth strategy or an eventual ownership exit strategy. So, what’s the difference between an immediate straight sale of a practice and a practice transition? An immediate straight sale of a practice is a transaction-driven dynamic, while a practice transition is a relationship-driven dynamic. This is because both the associate who intends to transition to ownership of the practice, and the current owner-doctor, will still be working together for several years or more.
Beginning The Transition Process
Just as every dental practice is different, so is every transaction process. This makes it important to begin the transaction process in a way that it aligns the shared vision of both the owner-dentist initially and the associate dentist. And, for the greatest probability of a successful transition process, it’s best to work with a Healthcare Business Advisor who understands the dental practice industry and what it takes for new dentists to become successful.
Contact Pluto Partners
To learn more about dental practice transition, contact Pluto Partners today and speak with a Health care Business Advisor who can answer any questions you might have.
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