When a practicing dentist dies, what happens to his practice? At times like this, the family of the deceased dentist usually has two choices of whom to turn to for assistance:
- The family attorney, accountant, relative or key staff member offers to assist the spouse in trying to sell the practice.
- A dental practice broker who was identified by the deceased dentist prior to his death.
The surviving spouse usually is so caught up in grieving and handling the funeral arrangements that it is extremely difficult for her to focus on dealing with the many details of operating and selling her late husband’s practice. There usually is a brief grace period during which the family, staff and patients are grieving, but sooner or later the staff reports back to work and the phones resume ringing.
As the word spreads of the dentist’s death, usually there are several calls to the office or to the widow from young dentists or dentists with neighboring practices who are interested in buying the practice. Most of these initial calls are from dentists who believe that they may be able to purchase the practice for a significantly reduced price.
Unless the deceased dentist has named a broker to handle the sale of his practice, someone volunteers to help the widow with all the pressing questions from staff and patients and with calls from prospective purchasers. Although this person may have little or no experience in appraising or selling dental practices, in this type of situation, that fact usually goes unnoticed.
Once the widow delegates these important responsibilities, it is very difficult to turn back. Precious time that is lost immediately after the dentist’s death can never be recovered. If the initial prospects turn out to be nothing more than shoppers looking for bargains and no marketing program is initiated, then there may not be enough time remaining to recover.
If the deceased dentist had identified a dental practice broker prior to his death and given his personal representative the authority to enter into the necessary agreements, then the practice broker will be in a position to hit the ground running. The following are the types of things that a good practice broker will do immediately:
- He will appraise the practice in order to know what price to ask for the practice and to be able to justify that price with potential prospects and lenders to get financing.
- If the deceased dentist owned the building, the practice broker will request a real-estate appraisal.
- He will enter into a listing agreement with the personal representative or executor of the deceased dentist.
- He will be in a position to help recruit temporary dentists to operate the office while it is being sold.
- He can assist the spouse in drafting a letter to be sent to all active patients.
- He will be able to contact those dentists whom he knows are looking for a practice.
- A good practice broker will put into action a comprehensive marketing plan to seek out additional qualified prospects.
In addition, American Dental Sales member brokers have the added advantage of being able to use our national network to find qualified prospects. The network includes our Internet homepage, the ADS classifieds in each issue of Dental Economics and our referral system between ADS brokers throughout the United States.
Dentists who own their own practice should understand that if something unexpectedly happens to them, their families should know whom to call. Family members not only need specific instructions as to who should sell your practice, but they also need the authority to enter into the necessary agreements. They must be able to act quickly and decisively. If there is indecision or the inability to be able to act on their part, your practice will die with you.
Guy Jaffe is founder and president of The Dental Marketplace in St. Louis, a dental brokerage and appraisal firm. He is one of the founding members of American Dental Sales (ADS) and its current president. He can be reached at (800) 221-6927. See ADS Classified ads for names and phone numbers of other ADS members.