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How to Sell a Dental Practice
The dentistry sector has one of the most complex and strict regulatory frameworks, which means that buying or selling a dental practice is unique in comparison to the same transactions amongst any other types of businesses.
Engaging the very best expertise to assist you is crucial if you have decided to sell. Dental practice legal specialists should be selected for their in-depth knowledge of this niche area of law, as well as their proven track record and experience in prevailing over the typical complexities that can arise in certain circumstances.
There is much to consider, not least the transfer of contracts and agreements for NHS practices; dealing with treatments that are yet to be concluded; preserving practice goodwill; property matters and the timely transfer of Care Quality Commission registration.
In this guide on how to sell a dental practice, we have addressed a selection of some of the most commonly raised queries. Tailored advice is of course vital, and should be sought at the very outset so that you are in the best position possible to move swiftly when the right offer is received.
What information will I need when selling a dental practice?
When selling a dental practice, your purchaser will request various pieces of information in line with their due diligence exercise. It is important to bring all of this together in readiness for the request so that you do not hold things up.
The information you will need includes building regulations certificates; asbestos audits; energy performance certificates; rateable value documentation; financial statements; employee expenses; PAYE records; employee and associate contracts; staff inoculations and X-ray test certificates. Lease information should also form part of the information pack. Bear in mind that there should be sufficient term left on the lease, otherwise the buyer will struggle to attain finance. If the remaining lease is less than ten years then you will need to arrange a lease extension before you start marketing the practice for sale.
What is the process of selling a dental practice?
The process of selling a dental practice is an involved one that calls for specialist legal and financial expertise. Regulatory constraints mean that certain steps must be precision coordinated to ensure a smooth transition from seller to buyer that at no point leaves any party exposed to the risk of illegal operation or open to objection by official parties such as NHS England.
In summary, the process to sell dental practices involves:
- Appraisal and valuation of the practice through a specialist valuer
- Information pack compilation (see above)
- Marketing the practice through a specialist agent or professional network
- Responding to buyer due diligence queries
- Meeting any buyer conditions submitted with the offer
- Drafting of the sale and purchase agreement
- Transition management, i.e. transfer of the GDS contract or PDS agreement together with Care Quality Commission registration transfer and TUPE transfer of employees
How can I increase the value of my dental practice before I sell it?
There are numerous steps that can be taken in order to boost the value of a dental practice. When you come to sell, dental practice value is of great importance, not only for the obvious reason of gaining a higher selling price, but also because greater values tend to rouse more interest.
Marketing activity and reputation stand for a great deal where value is concerned. A practice with an active, well-maintained website that offers patients the opportunity to keep their records up to date and book appointments online will show a good level of patient care and increased potential for retention. The use of technology is important to capture today’s audience, and this extends to social media such as Twitter, Facebook and LinkedIn, which acts as both a marketing tool and a patient care and retention platform. All of this makes a practice far more inviting to a potential buyer, as there is an established, up to date online presence ready to tap into.
The physical aesthetics of a practice are also of great importance. A welcoming, freshly decorated, light and airy reception and waiting area will create a positive first impression. Contemporary examination rooms and modern technology such as automated check-in and patient calling systems will show that the practice as an attractive investment.
Lastly, a business and marketing plan that sets out plans for achieving new patients, re-activating dormant patients and maintaining existing ones as well as encouraging referrals will inspire a prospective buyer when selling a dental practice.
What are the differences between selling an NHS practice and a private practice?
When you sell an NHS practice, you will usually transfer the NHS contract as part of the business. It is important to include your NHS paperwork in your information pack. As well as the original contract, you should include recent vital signs reports and pay statements. Buyers will wish to see performance statistics and will expect to be made aware of any breaches or remedial notices that have been served, and what has been done of them.
NHS GDS contracts and PDS agreements follow different transfer processes and no two cases are the same. Again the need for specialist legal advice cannot be over-emphasised so that you can ensure you are taking the right approach, as some cases will call for quite complex procedures. Serving transfer notices at precisely the right time is very important so as to ensure NHS England has no grounds to raise an objection.
Getting professional advice
It is clear to see that when it comes to how to sell a dental practice, there is a substantial call for professional expertise. As specialist dental law solicitors we will be able to guide you through every step of the process, ensuring that every detail is accurately covered in order to protect the interests of all parties.
We can help you expertly coordinate the necessary transfers of contracts and agreements for NHS practices; ensure the timely transfer of CQC registration; take care of all the employment and property related matters; draw up the sale and purchase agreement; deal with any required lease extension and provide tax related advice, all the time ensuring the transaction leaves none of the parties exposed to the risk of illegal operation.
When selecting professionals to assist with selling a dental practice, you must do your own due diligence. Seek out recommendations, niche experience and in-depth knowledge.