Dental Practice Seller FAQs

1Q: Do I need a broker? Can I sell the practice myself?
A: There are no state or federal laws that require you to hire a broker, so legally you can sell the practice yourself. However, many dentists now hire a broker for a myriad of reasons. Selling a practice takes about 200 hours. This includes the following:

  • Valuing the practice
  • Preparing a practice prospectus or offering memorandum
  • Placing ads in national publications
  • Organizing documents, fielding calls and questions, sending non-disclosure agreements
  • Showing the practice, reviewing letters of intent, due diligence
  • Answering questions from CPAs, advisors, consultants, and other interested parties
  • Negotiations and closing
2Q: When dentists sell on their own, is it usually successful?
A: According to bankers and attorneys, when a dental practice is sold without a broker, it falls through about 50% of the time. This means the process has to be done more than once and is almost always sold for less money.
3Q: What value does a broker add?
A: A broker takes care of everything for the seller, which saves about 200 hours. He or she also brings qualified buyers, offers advice for maximum results, and does all the negotiating. They are knowledgeable in accounting, financial analysis, taxes, state and federal laws, practice management, real estate and human resources. According to dental attorneys and practice finance specialists, when a broker is involved in a transition, the sale goes much more smoothly with an easier transition and a more guaranteed final sale.
4Q: What can I do now to prepare my practice for a sale?
A: This is a great question and something to start thinking about at least 3 years before selling. Menlo has put together a comprehensive step by step plan for dentists considering a transition. You can find the advice HERE. (link to prepare my practice)
5Q: What is the first step when I am ready to sell?
A: The first step is to have your practice valued. This requires quite a few documents that an appraiser will need access to, including: three years of tax returns, payroll reports and a few practice management reports. With these documents and an after hours site visit, one of our credentialed practice value analysts can come up with the value of your practice.
6Q: How long will it take to sell my dental practice?
A: On average, selling a dental practice takes between 4 and 8 months. However, some may take longer while others are under contract in 30 days. Practices in metropolitan markets sell faster than those in secondary markets. Specialty practices (with the exception of orthodontics and pediatrics) tend to take longer to find a buyer and longer to transition. One way Menlo ensures a timely sale is by correctly pricing the practice. When sellers overprice, it leads to decreased traffic, a longer sales cycle, fewer options, and ultimately a lower price. Correct pricing is crucial.
7Q: Will I be required to work at the practice after closing?
A: In general, most buyers require the previous owner to stay around to assist with the transition. Doing so makes patients and staff more comfortable with the new doctor. The length of time that is required ranges from a few days up to 6 months. This is negotiated in the contract.
8Q: How is my confidentiality maintained during a sale?
A: Menlo conducts all its business carefully and confidentially. We begin by identifying buyers who may be a good fit. We are routinely approached at speaking engagements at study clubs, dental schools, AZDA conventions and industry podcasts and have a pool of intrinsically motivated buyers.

We then advertise general terms of your practice (see our listing links) in all local dental outlets and channels. We have ties and connections with the most involved dental CPAs, attorneys and lenders in the state and spend significant advertising dollars on other various proprietary marketing avenues to ensure optimum and maximum buyer contact.

Prospective buyers are required to sign a Non-Disclosure Agreement, provide a current resume and provide proof of pre-approval financing from a dental lender. Once these pre qualifications are met, we then provide your identity and practice details. If the buyer feels your practice is a good fit, he or she will schedule a showing on a weeknight or weekend, when the practice is empty (the seller is not required to be present). Other than the buyer, their attorney, lender, and CPA, no other parties should be informed of the practice sale.

It is the seller’s sole discretion and prerogative when to tell their employees of an impending sale. We counsel with every seller individually to determine a personally tailored plan that is best for you and your business when it comes to confidentiality.
9Q: Will my patients accept a new dentist?
A: Your patients will accept a new doctor if the introduction and transition are handled the right way. Your endorsement, coupled with staff acceptance and enthusiasm is key.