Dental and Medical Counsel Blog

Whether you are a first-time buyer of a dental practice or have previously been involved in a purchase, there comes a time in the due diligence process for you to make an in-person visit to the seller. Some buyers have said this meeting can seem somewhat like a first date. They say they are nervous about saying the wrong thing and making a bad first impression.

Remember that the purpose of this first meeting is not to conduct in depth due diligence but for you to form an impression about the practice. It’s true that you want the seller to like you; to think you are the very best dentist to purchase the practice.

You also have some questions to ask, but do not want to come across as a police detective questioning a witness. Your goal is not to be confrontational, but to have your questions presented in a way that inspires the seller to want you to be the one dentist to whom he or she wants to sell the practice.

There are ways to get the answers you need while, at the same time, generating a positive feeling. It is a good idea to have your counsel who is assisting you with the purchase and who has either completed the legal and financial due diligence or who is in the process of performing those due diligence tasks, go over the questions with you. Also, write them down and take a pen and paper with you to the visit/interview so you can make notes while you are discussing your questions with the seller.

Perhaps divide questions into broad categories that appear positive while you delve into the “meat and potatoes” so to speak of the dental practice. Here are some questions to consider asking.

What Do You Contribute to the Success of the Practice?

This polite opening can set the tone for the visit. It is an open-ended question which gives the seller a chance to tout the benefits of owning the practice and perhaps volunteer some red flags. The question indicates you are there to listen and learn, not to confront.

Be a sincere listener and listen carefully. Not only are you there to assess the practice, but you are also there to create a rapport between you and the seller. The seller will be giving you clues as to what he or she is looking for in a buyer. While you are assessing whether you want to buy this practice, the seller is assessing whether you are the one they want to sell it to.

When you ask the question, “To what do you contribute the success of the practice,” you are being sincere. The seller must have done something right or you would not be considering purchasing the practice. Apparently, the dentist has attracted patients, has a team, and has kept the practice running long enough so that he or she is now selling it.

Some specific questions that may follow include:

• What is your overall philosophy of the dental practice?
• What are the main procedures you perform in the practice? What type of procedures do you refer out and why do you refer them? Do you think those procedures could be done here?
• How do you generate patient satisfaction feedback?
• Do you do any formal advertising? If not, how do you attract new patients.
• Do you have much turnover with your team? What benefits do you provide to your team? What do you think is the secret to maintaining team members long term?
• Are you involved in any social organizations in the community? Which community organizations would you recommend the new dentist to be involved with? If not involved in any, is there a good reason why not?
• Where are most of your new patients coming from? How many do you get a month?
• Do you have a recall program in place?
• Do you have routine communications with your patients, such as a periodic newsletter or do you send out birthday or holiday cards?

Be sure to ask these questions with a genuine interest. You must be sincere and listen carefully so you are ready to ask follow-up questions when indicated and to make it a focused discussion, not like an interview required so you can write a college paper or like a drill sergeant barking commands.

Focus on Aspects of the Practice That Impressed You

Of course, there may be things that annoyed you as you looked around the office and met the team. Maybe you are highly organized and noticed there are boxes stacked up behind the receptionist’s desk and the pencils are not sharpened to your satisfaction. You can deal with those things later. Your focus is still on the moment, building rapport, and fostering communication.

There must be some things that impressed you. Some suggestions might include:   

• What about the practice are you the proudest?
• What makes a good team? Is there a particular team member you consider a “star?” If so, what makes them star quality? Did you assist in making them a star and if so, what did you do? Can you give me advice on how I can do that?
• What is your favorite part of the dental practice?
• What is your least favorite part of the dental practice?
• What do you like most about the patient interaction?
• What is your favorite procedure to perform? Why?

If the layout of the dental practice is particularly effective, you may want to ask if the dentist was involved in the layout and design. If so, you may want to ask how much input they had and is the entire layout of the dentist’s design.

What Should I Know About the Patients, the Community, Associates, and the Team?

This broad, encompassing question should engage the seller in an open-ended discussion about the patients, community, associates, and the team. Some specific questions you can include in the discussion might be:

• What are the demographics of this community?
• Is there a major employer in the community where many of your patients work?
• If you lease the office space, do you have a good relationship with the landlord?
• Have you had, or do you now have, associates? How has that worked out?  Do you recommend I have associates, or do you recommend any current associates stay on as employees after the purchase is finalized?
• Do you have any advice on ways to decrease the overhead?
• Do you have any advice on how to generate more income?
• Are there other dentists in the area whom you consider competition? Any who you consider good friends? How do you suggest I approach these dentists?

What Do You Plan on Doing Next?

This is another open-ended question giving the seller the opportunity to tell you why he or she is selling the practice. Is it to retire? Are they moving to another city, state, or country? Moving to be nearer children or grandchildren? Or is the seller just burned out of dentistry and wants to quit. Is there any bitterness?

These are not just questions you have so you can snoop but are important things for you to know during the transition process. The transition will be different depending on whether the seller is leaving town or will still be close by. It will be different depending on whether the seller wants to hand over the keys at the end of the sale and be done with it or will be around for a time after the sale and available to you for a while if questions arise. Also, it would be interesting to know if the seller plans on seeking employment elsewhere, though the seller might not be as forthcoming.

Some ways these questions can be phrased include something like:

• I expect you are looking forward to the close of the sale. Are you planning something exciting?
• What kinds of things do have planned for when you do not have to come to work every day?
• Is there any particular plan you have that makes it necessary for you to sell the practice right now?

What Advice Will You Have for Me If I am the One Who Buys the Practice?

This question provides an opportunity for the seller to really open up and provide you with information you may not get in response to any other question. It only requires you to listen. You can tell by the tone and what is said whether the advice is coming from one who enjoyed the practice and who is upbeat in general or is coming from someone who is burned out. Make notes. You may find this question unleashes a lot of helpful information.

Dental and Medical Counsel Can Help

At Dental and Medical Counsel we are proud to be one of the most trusted law firms for dentists. We work with you and are actively involved in every aspect of the purchasing process.

We will assist you in learning how you can go about assuring the seller that you want to maintain his or her good reputation in the community and maintaining confidentiality about the sale until the seller is ready to release that information to their team members and the community itself. Your goal at the interview is to obtain important information for your evaluation of the practice while at the same time, creating a favorable impression so the seller wants you to be the buyer.

If you need assistance with your practice transition, contact Dental & Medical Counsel to schedule a complimentary consultation with dental attorney Ali Oromchian.