Win/win or no deal
Thinking win/win requires us to commit to cooperation, not competition. If a win/win agreement can’t be reached, both of us must be willing to walk away and choose No Deal. The goal of successful succession planning for a dental practice is creating a win/win situation for everyone — the outgoing dentist, the new owner, staff who stay on, and most importantly — the patients. The best way for me may be at odds with the best way for you. Thinking win/win helps all of us get what we want and need.
Win/win results in a synergetic combination that’s more powerful than the sum of the separate parts. My recent merger with Norton Hindley’s practice exemplified this win/win synergy. Norton had the expertise, experience and knowledge. I had the youth, energy and enthusiasm to carry his ideas forward. Sadly, this synergy was short-lived, and only a few months after our firms merged, Norton passed away
Win for the departing owner and win for the new owner
As a seller, I want the highest price possible. But the buyer wants to pay the lowest price possible and still get good value. An outgoing owner wants to ensure that financial needs after retirement are met. An incoming owner wants a practice that will provide a good income and career satisfaction.
A win for both of us means that both of us received value in the transaction. A new owner will pay a premium for an exceptionally well-run practice. Systems are in place to keep staff at maximum efficiency, and everyone is willing to work hard. Patients are delighted with the service they receive, and gladly pay a premium for the experience. This value isn’t created overnight, but is the payoff for years of effort.
What will you need to retire?
Many practitioners land in financial difficulties at retirement when their practice doesn’t turn out to be worth the price they had in mind. If you’ll need a payout of $2 million to support your desired lifestyle after retirement, you’ll have a very tough time if your practice is only worth $1 million. If you know about this value gap early enough, you’ll have the time and opportunity to close it.
Whether you’re decades, years or months from retirement, I can help you with an estimate of your practice’s value now, and can help you develop a strategy for increasing that value. Call our office today so we can help you create a win/win for your succession plan.