Top 10 Questions to Ask the Seller
When purchasing a dental practice, meeting the Seller for the first time is an excellent opportunity to determine whether a practice presents the right opportunity for you. Below is a list of the top 10 questions we recommend the Buyer consider when visiting the Seller.
When do you want to sell the practice?
What plans do you have after the sale of our practice?
Do you anticipate the staff staying after the sale?
What benefits do you provide to the staff?
What advertising methods does the practice use?
How have you attracted new patients?
What procedures do you refer out?
What is your practice philosophy?
What do you believe has contributed to the success of the practice?
What advice would you share with me if I were to buy the practice?
The above list of questions is a starting point for the conversation and is not exhaustive. It is highly recommended that the Buyer ask the broker questions regarding the practice appraisal and tax returns before meeting with the Seller. It is also important to defer all questions regarding the sales price to the broker.
The Buyer should be prepared to ask good follow-up questions. If the Seller does not have an answer to one of the questions, the buyer should be patient and understanding. It is recommended that the Buyer brings with them their list of questions as well as a pen to take notes.
Make a Good First Impression
Meeting the Seller for the first time is a critical step for the Buyer in deciding if a practice is “the one.” Before visiting the Seller, the Buyer should do their due diligence and carefully review the practice appraisal, tax returns, and practice reports to determine that the practice meets their minimal criteria.
The Buyer should go into this first visit with the intention that this will be the first of several encounters with the Seller. Making an excellent first impression will help establish a foundation for a successful transition. If the Buyer determines later to purchase the practice, they will want the Seller to recommend them to the patients and staff. The Buyer should remember to:
- Be courteous with the Seller’s schedule.
- Dress and act the part of a serious Buyer.
- Turn off your cell phone and listen.
It is recommended that the Buyer have as many questions answered by the Broker before meeting with the Seller. This will allow the Buyer to focus time on questions the Seller is better adept at answering. For example, the Seller is usually not the best person to ask questions regarding the tax returns and other financial numbers.
We strongly recommend the Buyer bring their list of questions with them. If the Buyer would like to bring a camera to take pictures of the practice they should ask the Seller for permission.
Prior to asking your questions, spend a few minutes introducing yourself and getting to know the Seller. Becoming familiar with the Seller can help you better understand the practice. Some Buyers feel that opening up to the Seller can damage their ability to negotiate, but remember you are not buying a used car or a souvenir in Mexico. Being open and creating a relationship of trust helps both parties through the transition process, especially if there are disagreements in the negotiations.
Do Not Negotiate
The sales price of the practice is a crucial factor in deciding whether to purchase a practice, but defer all sales questions to the Seller’s broker. It is inappropriate to question the Seller about Sales Price or negotiate other terms of the transition. Negotiating directly with the Seller can damage the goodwill portion of the practice and could cause additional problems through the transition.