Life happens when you’re busy making other plans...
I was reminded of this when my phone rang this past weekend. A close friend collapsed and died suddenly at the airport as she was about to board a flight to Chicago. Fortunately, she had planned well, and her family will not have a financial hardship to go along with the overwhelming grief they must be feeling.
About three or four times throughout the year, I get a somber phone call from a spouse or colleague to inform me that they just lost their loved one to a heart attack or some terrible accident. They need my immediate help getting their practice sold as quickly as possible. I hope that your family never has to go through such an event, but if it did happen, would they be prepared? Nobody wants to visit such thoughts, and hopefully, your spouse will never be in this situation. However, if they do need to face this, would you want them to have a plan in place, so they know your wishes?
If your practice is a general practice and well maintained, located in a suburban to urban community and has a strong net of somewhere between 38% and 40% it could sell within six months to a year depending on the market. In a death sale, you need to sell it within 2 to 4 months at best, and the price could decrease drastically depending on the situation. I would advise you to make a basic plan for your loved ones, just in case of emergency.
Discuss this with your spouse and have a folder set aside with step-by-step instructions of who to call and what to do. Get an opinion of value from a trusted broker in your area now. Most brokers do not charge for this, and some will do a full valuation and keep it on file for you should it be needed for the future. Let your spouse know that the value could be significantly reduced from the current value depending on the supply and demand in your area. If you belong to a mutual assistance group (a group of dentists that pledge to rotate and help cover one another in case of emergency for a preset period), have the contact information available for someone to call. If you do not belong to a mutual assistance group, ask your spouse to have the broker help with finding a locum-ten um for the practice during the interim. Draft a letter to patients letting them know that you have a plan in place to take care of their dental needs until a successor is found. Have a friend/colleague’s name and contact information to help guide your spouse through the process if needed. Following these steps will help to maintain the value of your practice and protect this valuable asset.
This article was written by Lynne Nelson co-founder of Practice Management Associates, LLC (206) 455-5388. For a no-obligation consultation or questions regarding study club presentations, please call us! Copyright © 2018