Whether you are already a practice owner looking to acquire a new practice for expansion, or, you are brand new to business ownership, there are certain steps involved with buying a dental practice in the UK.
Dental & Medical Financial Services have been working with new and established practice owners for over 20 years to help smooth the process and ensure you can raise the important commercial finance required to complete your transaction.
Step 1 – find the right practice for you
It sounds obvious but finding the right practice can be a challenge in itself. Things like location, practice ethics and price all play part of the decision making process. Consider the following:
- Is the location practical for you? Will you have to relocate?
- What styles of dentistry are currently practiced there?
- Is the patient profile and demographic what you are looking for?
- Will the team be retained when you take over and will they be suitable?
- Are there opportunities to enhance existing income and profit levels?
- Is the price within your budget?
Step 2 – Assess the business financials
Assessing the financial accounts of a business is essential for any acquisition. It is vital to understand the financial position of a business in detail before you commit to taking it over and depend on earning a living from it.
- Primarily, you are looking for reassurance that the business can continue operations.
- Secondly, you will be trying to determine if a business has clear opportunities to build on the existing position. For example, is the hygienist under utilised? Is there an empty treatment room that could house an associate or even just earn a rent each month to help cover some overheads.
Ensure you carefully assess income and profit trends as well as analyse key expenditure as this is information that will be required to raise the important commercial finance.
Step 3 – Assess your personal financials
It is also important to understand your own personal financial position before entering a big business commitment.
What are your financial requirements of the new business, if any? What timeframes would you need to draw an income from this practice, considering worst case scenarios.
It is likely that as part of a commercial finance application that your personal finances will also come into play.
Step 4 – Secure dental practice finance
Raising the finance to purchase a dental practice is clearly a vital part of the process. Without it, there is often no moving forward with a deal unless you have other means of obtaining the funds.
The application itself can be complex however, more importantly, finding the right lender is essential to ensure you get the best deal for your situation.
Dental & Medical Financial Services have excellent relationships with commercial finance lenders and we work with an experienced Independent Finance Broker to ensure your application is completed accurately and with the greatest chance of success.
“I have known Darren now for 14 years and he has provided innovative and professional advice both for my personal and practice finances. His team have always been approachable and friendly and he remains knowledgeable about my individual circumstances, helping me fund numerous ventures over the years. I would have no hesitation recommending him to anyone and have done many times.” Dr Neil Haughton
Step 5 – Prepare a financial forecast
Whether it is required or not for the formal practice finance application, it is a useful tool to be have as a business owner to predict how your business will perform in the next 1, 3 and 5 years.
Working with a specialist accountant and financial adviser will help as they are familiar with dental practice operations and keep up to date with market trends.