‘Practice transition’ is one of the most misunderstood phrases in the dentistry field. Most dentists in private practice refer to the phrase “dental practice transitions” as “sell, retire, or broker.” There is always a demand for specialists who broker the sale of different types of dental practices but there is always a distinction between an immediate sale of courses and the natural dental practice transition. Multiple types of practice transitions should be adopted based on the needs of the business.
Buy-out
When a purchaser buys a dental practice for a negotiated price, it is referred to as a “buy-out dental practice transition.” Compared to other types of practice transitions in the field, the buy-out has a comparatively shorter transition period. This particular practice transition is considered perfect for possible retirement, with a period lasting no more than three months. Sometimes, the seller might agree to be engaged part-time so that the transition phase is seamless for patients, buyers, and employees.
Buy-in
When a purchaser buys a specific portion of the dental practice for a negotiated price dictated at the initial stage, it is called a “buy-in practice transition.” When a buy-in dental practice transition is involved, a professional practice broker initiates a personality profile assessment. This helps to assure compatibility, along with accurate practice analysis and hassle-free dental practice transitions.
Associateship
When considered in theory, the associateship practice transition is regarded as a good option. This is primarily because associates are not difficult to find. Additionally, this type of transition enables individuals involved to enjoy complete dominion or control over the process of practice transition in dentistry. However, it has been studied that in an associateship dental practice transition, 20% to 25% is adequate. This is because everything needs to be agreed upon from the beginning. Furthermore, different expectations are not catered to by the parties involved in the process.
Merger and roll-up
In a merger, two dental practices become one entity with an equal partnership. A union is a successful and effective process until compatibility is maintained and income and responsibilities are divided equally from the beginning.
In the case of a roll-up, multiple dental practices are bought over a certain period and combined into one establishment. It gets sold at a higher value later, following the economies-of-scale principle.
Associate to buy-in
A group of associates woos a prospective buyer to buy in over a particular time, determining the course of action for a more straightforward practice transition. In this type of dental practice transition, there is no need to make upfront decisions about the practice’s future. Instead, the associate-to-buy-in transition offers the time to assess the compatibility and other required factors. The segregation of power is one of the most critical considerations in this transition method.
Conclusion
Whether there is a plan to sell dental practices for managerial or retirement purposes, exploring the different dental practice transitions is vital. Breaking down the different types of practice transitions helps to figure out the ideal option for a specific business.
