The Importance of Fit Between Buyer and Seller of a Dental Practice
You like the Rolling Stones? I like the Rolling Stones too! Great, you’ll be a perfect buyer for my practice!
Maybe that’s a bit of a stretch when addressing this topic but finding the right fit when selling a dental practice is more than just a few common interests. Finding a great fit is equally important for both buyer and seller. Let’s break down why for each.
One of the questions I get asked the most by dental practice sellers is “How will I know if the buyer will take care of my patients and staff?” Let’s face it, selling something you’ve spent years growing, nurturing, and shepherding becomes more than just a business transaction; it becomes personal and emotional—like handing your child over to a new parent. “Will they immediately fire the staff?” “Will patients like the new doctor?” “Are their clinical skills similar to mine?” These are questions that are often more important to sellers than “How much is the offer?” or “What can I expect to keep after taxes?” Because of this, finding the right buyer becomes more than just who is paying the highest price. This is why I’m a big proponent of introducing buyers and sellers as soon as possible, and why I feel sellers should lead practice tours. Being involved from the beginning gives sellers the opportunity to ask questions, compare notes, find common ground and start trying to envision having someone new take over their sandbox. More often than not, the successful buyer of the practice is discovered during the initial tour and not when offers are submitted. When sellers feel like they have found the right buyer, it is a special event and one that almost always results in a massive weight being lifted off the seller’s shoulders.
Dental practice buyers can sometimes be characters, like the time one told me, “You need to find Barbie for this one. The patients are not going to like a hairy guy like me.” As the broker, I wasn’t quite sure how to tackle that concern, so I suggested a full-body wax. Actually, I think I jokingly told him to just wear more PPE and no one would know. But, eventually, I had to take his word for it and put him down as a pass. When leaving jobs and taking out huge loans to buy a practice, Buyers want to know that 1) the staff won’t revolt and 2) the patients will not leave. This is another reason why I like sellers to lead the initial tour. Buyers can really like a practice on paper, but it is not until they meet the seller and start asking questions that it really gels. Plus, most of the initial questions buyers ask are clinical, so I’m basically no help at all. When buyers tour a practice, they make mental notes like the distance from their home and the flow of the office. They almost always struggle to balance their time envisioning themselves in the office with firing questions at the seller—all of which is sometimes difficult to do in 30-45 minutes. Much like the seller who may not be so concerned about the financial aspects of the sale, buyers, if they feel like they fit, will more or less leave the bank to sort the finances and will focus more on the transition.
So what are some areas that determine fit:
- Personality and Demeaner
- Clinical approach
- Communication style
- Leadership style
- Office culture philosophy
The more dental buyers and sellers align in these areas, the more natural the transition.
So, does all this mean that fit is more important than money? After having sold many practices, I would have to say is a close competition, and this is because of the nature of the thing being sold. Practices are not cars, extended warranties, lemonade, or stocks, they are an entire chapter of a person’s life—especially for those who have spent decades treating thousands of people who often evolve from patients to friends. The right fit in a transition will almost always lead to future success of the practice, and that success is most likely achieved when buyer and seller find someone who shares similar skills, goals, personalities. After that fit is achieved, a common interest in music can only help.