Know your numbers.
You’ll then need to have a valuation from a specialist dental broker. Lily Head explains: “A specialist dental broker will assess the dental practice profile, location, income streams, income generators, treatment types, opportunity, reputation, patient base, premises and access.”
Financial statements will be reviewed to establish the EBITDA (Earnings, before tax, depreciation, and amortisation). It’s a multiple of this EBITDA which is one of the foundations of the sale price and what lenders review when determining if they will fund a purchase.
There are a couple of things to avoid according to Lily Head. “Don’t let a purchaser calculate a valuation for you. Don’t get a valuation from someone who does not actively manage transactions. You will never get a valuation which reveals the full value of your practice from someone who only looks at your numbers.”
Now you have an idea of what your practice should be worth you need to take that valuation to your IFA (Independent Financial Advisor). You can then discuss how to manage that cash and plan your future in more detail. The sale proceeds may allow an earlier exit than you thought. Pension providers understand that the vast majority hugely overestimate the amount of money they’ll need in retirement.