DE: Dr. Hammel, how did you prepare your practice for sale before retirement?
Dr. Hammel: Our practice was in a very rural area. We had built a new building in 2000, and our patients were impressed with our innovative office and technology. We started to develop a reputation because we were different than other practices. That's a big selling point-but you must start early so the news spreads about your technology and grows your patient base along the way. New technologies are not simply shiny toys-they are meaningful tools to treat a variety of patients and perform additional procedures. They helped me become "super" productive, and that automatically increases the value of the practice. In short, use technology for better patient care, and word gets around.
Nancy: Besides the clinical aspects, practices are businesses too. You can have all the technology, but you must also have good money management and a practical business plan. The strategy of selling the practice needs to be thought out many years in advance. For example, you have to establish a budget. New technologies are amazing and evolving to make dentistry faster, better, and easier, but once dentists start adding tech, they can become "addicted." Then they always want more and lose sight of the bottom line. So prepare a budget that can accommodate for the addition of different components over time. Also, make sure you will actually use the equipment you buy. In our case, digital imaging was a part of our practice that was used every day, all day. For example, our DEXIS digital imaging system helped us to save money that we would have wasted on developing chemicals and film. The images were immediate, high quality, and-because of their digital nature-we could then enlarge, zoom in, and display them on a large monitor for better patient education. This technology was beneficial for us and for our patients, and it will continue to be a great advantage for the next owner of the practice.
DE: What were some of the challenges of selling the practice?
Nancy: We lived in a rural area, so that was a strike against us as far as finding an associate. Many want to start in a big city, but we did talk to a young man who eventually bought our practice. He saw my husband as a mentor from whom he could learn a great deal. Also, he recognized that he was coming into an efficient, productive practice with stable, well-managed employees and a low turnover rate. That really decreased the likelihood that he was going to run away! At the beginning, we told him that honestly, we wanted an associate, and at the time, we did not expect him to be a buyer.
DE: So how is retirement?
Dr. Hammel: Well, I had sold my practice and basically retired while finishing some orthodontic cases one Monday a month. Now, I work at a practice in Kansas City for a dentist who is the same age as I am. He has a big practice with 25 employees and two associates. Both associates left (one for maternity leave), and I stepped in to help out. This dentist's goal is to retain ownership and management of his dental practice and only work a half-day a week. He wants to attract quality associates, so he offers a well-run practice with some really great technologies. The practice is a retirement investment and a continuing revenue stream for him.
