Here are some of our most frequently asked questions and our answers. If your question isn’t on the list or you need more clarification, please contact ADS Lovelace and Associates and we will answer it personally.
Q: Describe what needs to happen in the transition of a dental practice.
A: Click to learn more about practice transitions.
Q: I have read that dental practices are worth 70% of their gross receipts averaged over the past three years. Is that true?
A:Rules of thumbs are simplistic and don’t usually work. Unless the practice in question is "average or below average" in all respects, you should probably get an appraisal. Your lender will also want an independent estimation of value before funding any loan.
Q: What is a reasonable Covenant Not to Compete?
A: A reasonable Covenant not to Compete will protect the goodwill of the Employer without being excessively restrictive on the Associate. These areas tend to be smaller in Urban areas and larger in rural areas. However, individual states interpret these agreements differently, so please consult an attorney for definitive advice. In Louisiana, the maximum duration for these agreements is two years from the sale of a practice or termination of employment. This distance for the Covenant is limited by the service area of the practice, which is where most of the patients live and/or work.
Q: Will the staff stay after I purchase the practice?
A: The staff typically is as worried about keeping their job as you are about keeping them. If they leave, they have to start working for a new doctor anyway, so why wouldn't they give you a chance? Click to learn more about staff retention.
Q. Will the patients accept a new dentist?
A. The patients will accept a new doctor if the introduction and transition are handled the right way. Seller's endorsement, coupled with staff acceptance and enthusiasm, is the key.
Q. How do you appraise a practice?
A. We utilize a number of different methods in order to determine fair market value, including market comparisons, cash flow analysis, and capitalization of earnings methods.