The Guide to Buying a Dental Practice

Buying a dental practice is the most thrilling, and the most difficult, aspect of your professional life. Providing vital oral healthcare and cosmetic treatments to the public both rewards you and helps local communities.

Whether you are buying your first practice or you are building a dental group, Samera Business Advisors are here to help you to achieve your goals and build your future.

We’ve been helping the UK’s dentists start their own dental practices for nearly 20 years and, as dental practice owners ourselves, we’ve learned a thing or two about buying dental practices.

For our friends and colleagues who are looking to embark on the journey of dental practice ownership, we hope this guide helps to start you on the path to your future in dentistry!

Click here to read more about why dentists want their own practices.

Starting or buying a dental practice can be a big task, especially if you’re new to the field. The dental market is always changing, so it’s important to stay updated on the latest trends and rules. In the UK, the dental business is growing, and there’s a high demand for good dental services. However, finding the right dental practice to buy can be challenging.

In this guide, we’ll give you all the information you need to understand the dental practice market in the UK. We’ll cover everything from current market trends and regulations to finding the right dental practice that fits your needs and budget. Whether you’re a first-time buyer or an experienced professional looking to expand your business, keep reading to learn how to navigate the dental practice market.

The Current State of the Dental Practice Market in the UK

The dental practice market in the UK is always changing and growing. More dentists are thinking about owning their own practice, whether it’s starting their own practice or expanding an existing one. Whether you’re a new dental graduate looking to set up your own practice or an experienced professional aiming to acquire one, it’s crucial to understand the current state of the dental practice market.

With interest rates currently higher than we’ve seen for a good number of years, it looks as though buyers are hesitant. This has pushed the price of many practices to be higher than they are really worth as sellers struggle to get the price they want.

Many buyers are waiting for interest rates to fall to get a better price. However, if you have the capital then this could be a great time to get the practice you want while other potential buyers hesitate.

It may be a better option for many to start their own practice. However, buying a practice will of course give you an instant, already existing revenue stream immediately.

Click here to read more about whether you should start or buy a dental practice.

Understanding the different types of dental practices available for purchase

When thinking about buying a dental practice, it’s important to understand the different types available for purchase. Each type has its own unique qualities, and making an informed decision will greatly impact your success as a practice owner.

Solo Practice:

This is a dental practice owned and operated by a single dentist.

It allows complete independence and control, making it a popular choice for dentists who prefer working on their own.

If you are considering a solo practice, you need to understand that most of the burden will fall on your shoulders. Assess your ability to handle both the clinical aspects and the business management side of running a practice honestly. This includes financial management, staff hiring, and patient acquisition strategies.

Partnership Practice:

Involves two or more dentists owning and running the practice together.

This arrangement allows for shared responsibilities, accountability, and financial risks. It’s great for dentists who want to collaborate with colleagues and share costs.

When thinking about a partnership practice, it’s crucial to identify potential partners whose vision, work ethic, and business goals align with yours. Draft a clear partnership agreement that outlines roles, responsibilities, profit sharing, and conflict resolution mechanisms.

Dental Group:

A dental group is 2 or more dental practices that all work together under a single name or brand.

These practices often have a centralized management structure but there are several ways a dental group can be structured. They may offer a wider range of dental services and each practice can specialise in treatments or simply cover a different area.

For those interested in building a dental group, it is essential that you get the financial and tax structure right from the start. If you’re thinking about buying multiple practices, you’ll really need the help of experienced dental accountants like Samera.

Specialist Practice:

A specialist practice focuses on providing specific dental services, such as orthodontics, periodontics, endodontics, or oral surgery.

These practices require additional training and expertise in specific areas of dentistry. Buying a specialist practice can be a rewarding opportunity for dentists with specialized skills or those looking to expand their service offerings.

It’s important to recognise that you may be limiting your potential patient list and you may need to work with other dentists under a referral programme.

Understanding these types of dental practices will help align your goals, preferences, and skills with the right practice. It’s crucial to carefully evaluate each option, considering factors like your experience, financial capabilities, desired level of independence, and long-term objectives. Taking the time to research and consult with professionals in the field will ensure you make an informed decision and position yourself well in the dental practice market.

How Long Does it Take to Buy a Dental Practice?

The short answer to this question is: it takes as long as the buyer and seller allow it to take.

Like any important transaction, buying a dental practice hinges on whether or not the buyer and seller can agree upon a price and contract terms. As the buyer, you are expected to make the initial offer on the practice, with negotiations to follow.

However, there are many tasks that you, or a representative like Samera Business Advisors, must perform in order to make sure that your transaction is legal and your resources are secure. These include:

• Care Quality Commission (CQC): The timing and execution of your CQC application is crucial to ensure that you are ready to begin operation of your practice after ownership is transferred; without CQC approval you won’t be able to trade.
  Click here to find out more about registering with CQC
• Funding: Unless you plan on financing your transaction in cash, you will likely be using your bank for funding. Banks are notoriously cautious. Both parties will need to agree the terms of borrowing with a business manager, and the contract will need to be approved by the bank’s Securities Department. Using a finance broker will help you ensure you consider all the funding options available in the market.
  Click here to watch our free webinar and find out more about financing your first dental practice
• Property and Leases: Often, the property side of the transaction can slow the deal down. It’s important you have a property lawyer that can assist in ensuring any lease in place can be assigned to you as new owner.
  Click here to find out more leasehold vs. freehold.

Factors to consider when buying a dental practice: location, patient base, and competition

When thinking about buying a dental practice in the UK, there are important things to consider that can greatly affect its success. These factors should be carefully thought about during the decision-making process.

Location:

The first thing to think about is where the dental practice is located. A convenient and easily accessible location is crucial for attracting and keeping patients. It’s best if the practice is in a well-populated area known for dental services. Being close to public transportation and having enough parking options can also make it more convenient for patients.

You need to be honest and realistic about your goals. Most of you may want to own a practice on Harley Street and live in Central London, but how realistic is that? If you want to own a practice at a good price, you may need to consider living in a part of the country you never envisioned yourself in.

You’ll need to reconcile your business goals with your lifestyle and family goals.

Patient Base:

Another important factor is the existing patients of the dental practice. How big is their current patient list and what is the potential to grow it? Understanding the demographics of the current patient base and the local area gives insights into the potential for growth and success. Things like age, income level, and dental insurance coverage can help plan marketing strategies and services that meet the specific needs and preferences of the patients.

Competition:

It’s equally important to assess the competition in the area. Analyzing the number and types of other dental practices nearby helps determine the level of competition and how saturated the market is. It’s also important to consider the services offered by competitors and any unique features that can make the practice stand out.

Growth Potential:

Evaluating the growth potential of the dental practice is essential. Factors like population trends, economic indicators, and the potential for new patients can impact the long-term viability and profitability of the practice. Conducting market research and seeking expert advice can provide valuable insights into growth prospects in a specific geographic area.

By carefully considering the location, patient base, competition, and growth potential, potential buyers can make informed decisions when navigating the dental practice market in the UK. These factors will help ensure that the purchased practice has a solid foundation for success and long-term profitability.

Dental Practice Valuations and Due Diligence

You must get a valuation from an established provider to receive an accurate purchase price of the dental practice for sale. Always remember, the valuation from the seller needs independent assessing. Do your own homework and employ your own valuer to ascertain if the dental practice for sale is really worth what the seller is asking for!

Earnings Before Interest, Tax, Depreciation and Amortisation (EBITDA) is currently used as part of the dental practice valuation process.

It’s important to remember that every practice is different. There are several factors that can form part of the value of a practice, including the accounts over the previous three years, the potential for development and expansion and whether a time limited (PDS) NHS contract is in place or an open ended (GDS) NHS contract.

Read our article on dental practice valuations to find out more.

Keep in mind you are not just buying real estate, you are buying a business. This may be the foundation of the next 30 years of your professional life! You must take the time to learn every facet of the dental practice for sale.

Once you know which dental practice you would like to purchase, it’s essential to know that you are investing in the right one. It’s too late to have regrets and doubts after you have signed contracts. This is an investment in the following years of a dental professional’s life, so it’s important to make sure everything is in order.

From the accounting to the exterior bricks and mortar, a magnifying glass must be applied everywhere. A specialist dental lawyer will know the right questions to ask so you can assess the business and plan for its growth.

You will also want to ask an experienced accountancy firm to review the financials and check the numbers for validity now and potential in the future. Management information, details from the software system and other important financial information will help you get a much better picture of the health of the business too.

As part of the due diligence process, your solicitor must request the seller to guarantee that the supplied information is correct in order to protect against any loss caused by misrepresentation.

There are certain aspects of due diligence that dentists themselves are best placed to examine, such as the way the practice operates and the treatments that are provided. However, when it comes to legal and financial considerations, a specialist dental solicitor and dental accountants should be part of the team.

It’s never a good idea to proceed without this expert help. Professionals know what questions to ask and what to look for in accounts and financial records. I have worked with many clients to co-ordinate the due diligence process, during the dental practice acquisition process, so I know how important an expert eye is.

A specialist dental accountant will:

• Analyse historical financial statements to verify accuracy and identify trends or anomalies.
• Evaluate the financial health of the business, including cash flow, profitability, and debt levels.
• Identify any existing or potential tax liabilities that could impact the business.
• Advise on tax-efficient structuring of the acquisition.
• Provide an independent valuation of the business to ensure the purchase price is fair.
• Prepare future financial projections to assess the potential growth and profitability of the business.

What is Included in the Due Diligence Process when Buying a Dental Practice?

“Due diligence is the process of evaluating a business from all aspects before making a purchase decision…It includes specific elements that can vary based on the situation and the nature of the business. Due diligence protects both parties but primarily the purchaser. It can uncover potential liabilities and financial matters and make sure nothing is hidden.”

Jean Murray, The Balance, 2018 (4)

Include everything that pertains to the viability of the business in due diligence. Do not leave anything to chance. From the building itself, to treatment lists, accounts and software, everything needs to be checked in microscopic detail. Too often I have seen clients getting ahead of themselves. Take a step back from the buying edge and make sure every aspect of the practice is viable, before taking the leap into purchasing.

There are several different points to consider when checking documentation during the due diligence process.

Here are some key questions and areas to challenge

Staff Costs:

• Are staff costs broken down by individual employees.
• Are hours worked and hourly rates provided.
• What are the contractual terms for each staff member.
• Are the services currently provided at the practice a good match to the services that can be provided should the sale progress?

Staff Continuity:

• Will current staff members remain post-completion.
• Do the staffing numbers look correct or are there family members within the financials who won’t be there post-sale.
• Do staff have signed contracts ensuring their retention.
• What level of income are the employees generating.
• Is the ethos of the current owner similar to the ethos which will continue?

Rental and Lease Agreements:

• What is the current rental amount.
• What type of lease is in place, and what term is left.
• Is the freehold available for purchase, and if so, what is its purchase price.

Income and Financials:

• Does the value of the business make sense based on its level of profit.
• Have non-recurring costs been accurately identified and excluded from reworked profits.
• Are they fully fulfilling contracts that might impact future income.
• Does billing match procedures that were carried out?
• Does cash recorded match what is reflected in tax returns?

This is only a fraction of what should be considered as part of due diligence when buying a dental surgery. Take time to make sure that every detail has been scrutinised. This is an important business and life decision that is being made, so do not take any chances. Remember to obtain a guarantee from the seller, as to the accuracy of the information provided. This provides protection against any future financial or legal issues caused by misrepresentation.

Negotiating the Price and Terms of the Deal

When it comes to buying a dental practice at the right price, figuring out the details of the price and deal terms is a crucial step. This is your chance to make sure you’re getting the best value for your investment and that the specifics of the deal match up with your goals. Remember, you make your profit when you buy at the right price and add value over the lifetime of your ownership.

First off, doing your homework and gathering as much information as possible about the practice is important. This includes checking the financial records, looking at the types of patients, evaluating the equipment and facilities, and understanding how much similar practices are worth in the current market. Armed with this information, you can confidently enter discussions with the seller.

One key thing to think about is the price tag. It’s crucial to have a clear understanding of how the price is set and if it makes sense based on the practice’s financial performance and potential for growth. It’s essential to get help from a professional valuer or a dental practice expert who can give an independent assessment of the practice’s value and guide you through the negotiation process.

Working out the details of the deal is just as important. This includes figuring out the payment structure, financing options, and any conditions that need to be met before the sale is finalized. For instance, you might want to include plans for a smooth transition period where the current owner helps with handing over patients and staff.

During negotiations, being flexible but also firm in your position is crucial. Be prepared to justify your offer or counteroffer with solid reasoning and evidence. Remember, it’s a two-way process, and finding an agreement that benefits both parties is the ultimate goal. A clear, honest and open conversation is crucial.

It’s highly recommended to engage the services of a legal professional experienced in dental practice acquisitions. They can make sure all the necessary legal documents are in place and help protect your interests throughout the transaction.

In summary, negotiating the price and terms of the deal is a critical step in buying a dental practice. By doing thorough research, seeking professional help, and staying persistent during negotiations, you can secure a deal that puts you in a good position in the dental practice market.

Legal Considerations When Buying a Dental Practice

When it comes to buying a dental practice in the UK, there are important legal and regulatory things you need to know. These considerations are crucial to make sure the transition into owning and running a dental practice goes smoothly.

First and foremost, it’s crucial to understand the legal requirements set by the General Dental Council (GDC). The GDC sets standards and rules that all dentists must follow, covering professional conduct, clinical management, and patient safety. It’s important to check that the practice you’re looking at meets these requirements and that the current owner has stayed compliant.

Also, if you’re buying a dental practice that already has employees, you should carefully review the Transfer of Undertakings (Protection of Employment) Regulations (TUPE). These rules are in place to protect employees’ rights during a change of ownership. Understanding your responsibilities as the new owner regarding employee contracts, terms, and conditions is crucial.

Another important thing to think about is the legal structure of the dental practice. You can choose to buy the practice as a sole trader, partnership, or limited company. Each structure has its own legal and tax implications, so it’s a good idea to consult with a legal professional or an accountant to figure out the most suitable option for your specific situation.

In addition to these legal considerations, it’s important to conduct thorough due diligence on the practice you’re thinking of buying. This might include reviewing financial records, contracts, leases, and any existing liabilities. Getting the help of an expert experienced in dental practice acquisitions can ensure that all legal aspects are properly addressed, and you’re fully informed before going through with the purchase.

By carefully looking into the legal and regulatory aspects involved in buying a dental practice in the UK, you can ensure a successful and smooth transition into ownership, paving the way for a prosperous future in the dental industry.

Click here to listen to our podcast episode on the 7 legal pitfalls of buying a dental practice.

Raising the Finance to Purchase a Dental Practice

When it comes to buying a dental practice, funding might be the most important thing to think about. It’s crucial to explore different funding options to make sure the transition is smooth and the growth is sustainable, if you can’t fund the purchase yourself.

One option is, of course, traditional bank loans. Many banks have special loan programs for healthcare professionals, like dentists. These loans usually have competitive interest rates and flexible repayment terms tailored to the specific needs of dental practice owners. However, getting a bank loan will require a strong financial history and collateral.

Another funding option to consider is seller financing. In this arrangement, the current owner acts as the lender and provides a loan to the buyer. This can be beneficial for both parties, allowing more flexibility in negotiating the terms of the loan. Seller financing may involve an initial payment and regular installments over a set period.

There are also specialized healthcare banks and dental practice finance companies that focus specifically on funding dental practice acquisitions. These lenders understand the unique financial needs of dental professionals and can offer customized funding solutions that align with the cash flow and revenue projections of the practice.

Another avenue to explore is seeking investment from partners or dental associates. This could involve bringing on a partner who contributes to the initial purchase cost and becomes a co-owner of the practice. Alternatively, dental associates might invest in the practice in exchange for a future ownership stake.

Lastly, it’s crucial to consult with a financial advisor specializing in dental practice acquisitions. They can provide guidance on the best funding options available, help navigate the financial aspects of the purchase, and ensure that the chosen funding strategy aligns with the long-term goals of the buyer.

Overall, exploring different funding options is crucial to finding the best solution for buying a dental practice. Each option has its own advantages and considerations, and it’s important to carefully evaluate them to make an informed decision that supports the growth and success of the practice.

How Much Will You Have to Pay?

A deposit of at least 10-20% is standard when buying a dental practice, whilst the remainder can be financed from a bank. The minimum cash deposit will usually be 5%.

It’s important to remember that when the lenders use their estimate of 80% of the value, they’re only estimating that value on goodwill. They do not include the fixtures and fittings in that. This is especially important to remember if the fixtures and fittings figure it quite high.

Click here to watch our webinar on the fees and costs of buying a dental practice.

When a lender assesses your loan application they will be looking at a variety of factors. These include:

• Your earning history as an Associate Dentist
• Your financial track record and how you have managed your personal finances e.g. do you have high credit card balances is always a bad time to apply for a loan.
• Your current living situation i.e. do you own your own house or rent?
• Your management experience and number of years you have from leaving Dental School
• Your ability to repay the loan with a comfortable margin of error if interest rates rise
• If you place an offer for a practice and do not have available funds (or a finance agreement in place) you risk being unable to buy a practice whilst losing credibility with a seller.

Click here to read more about financing a dental practice.

Check the Ratios and Find the Potential Profit

It’s important to chart the potential profit of your new dental practice. How much of an opportunity for growth do you see?

Make sure you ask how many active (seen in the last 10 months) patients the practice has. Out of those active patients, what are the ratios between check-ups versus treatments? That will give you a birds-eye-view of the type of work and, therefore, cash flow you are inheriting.

Ask the seller for a short (3-5 examples) list of their most outstanding treatments to gauge the effectiveness of their follow up system. If the seller is a member of a local business referral group or association, follow up with other members. After all, you are entering their community and early networking prevents many headaches.

Click here to watch our webinar on the top 10 mistakes to avoid when buying a dental practice.

Key Performance Indicators (KPIs) like these reveal the day-to-day work being done to maximize the practice’s earning potential. There are a number of dental KPIs, but let’s look at a few basic numbers you must ask for:

1. How many new patients have they generated in the last 12 months? Is this rate on the rise?
2. What are the exam and hygiene recall rates? Are they rising?
3. What marketing is working the best for the practice and which marketing avenues are exhausted?
4. What’s the level of new patients received from direct referrals?
5. What is the patient retention rate? How many patients did the practice lose over the last 12 months?

This will help you to understand how good the patient experience is and what you can do to improve it.

Managing the Transition Period Effectively

Owning your own practice can be both exciting and challenging. It’s crucial to handle this transition period well to ensure a smooth and successful change. Here are some important tips to help you navigate this process with confidence and clarity.

Firstly, being open is crucial during the transition period. Maintain open and honest communication with the previous owner, staff, and patients. This will build trust and ensure a smooth transfer of responsibilities. Schedule regular meetings or check-ins to address concerns, provide updates, and create a supportive environment for everyone involved.

Next, learn about the practice’s existing systems and processes. Take the time to understand the daily operations, patient management procedures, and financial aspects of the practice. This knowledge will help you identify any areas that need improvement or adjustment to align with your vision and goals as the new owner. Implementing changes gradually and with sensitivity will help maintain stability and minimize disruption.

Also, value the expertise of the current staff. They have valuable knowledge and experience that can contribute to the success of the practice. Encourage open discussion, listen to their insights, and establish a collaborative environment where everyone feels valued and motivated. This will facilitate a smooth transition and ensure continuity of care for patients.

Additionally, consider seeking guidance from experienced dentists or mentors who have gone through practice transitions. They can offer valuable advice and support, helping you navigate potential challenges and make informed decisions. Their expertise can be crucial in ensuring a successful transition and preparing you for long-term success as a practice owner.

Lastly, prioritize patient care during the transition. Communicate any changes or updates to patients in a clear and compassionate manner. Assure them of your commitment to maintaining the highest standards of dental care and address any concerns or questions they may have. Building trust and a positive reputation from the start will help retain existing patients and attract new ones.

By effectively managing the transition period, you can establish a solid foundation for the future success of your dental practice. With clear communication, a thorough understanding of the practice’s operations, collaboration with staff, and a focus on patient care, you can navigate this stage with confidence and position yourself for a thriving dental practice in the UK.

Many dentists who are selling their practice factor in a sense of legacy to the transaction, and may be more willing to negotiate with someone who can show respect for their accomplishments – while also being conscious of their own ambitions.

Click here to find out more about patient retention.

A good relationship with the seller is really help keep the process smooth. Not only that, some sellers may wish to remain working in the practice for some time. Others may still have close connections in the practice’s staff. Keeping the seller happy and onside will really make things easier for you.

Click here to find out more about selling a dental practice.

Keep the Dental Team

We think it is important to retain the team when you buy a new practice. Think of them as one of the assets of the business. They already have the trust of and their own loyalty to your patients, they are more loyal to each other and the practice (in most cases) and they have the knowledge of the business.

If you buy a dental practice and start getting rid of staff, you’re also getting rid of knowledge and experience. Not just in dentistry in general, but in your practice in particular.

If you want to build that loyalty and trust between yourself and your team as the new owner, consider holding one-to-one meetings, or group meetings with different teams, like your nursing or orthodontic teams.

Also, look at their pay. Make sure they are at least in line with national averages and include performances bonuses – there aren’t many better ways to get a team onside!

Enroll the whole team in your vision for the practice, it’ll make it easier to realise.

Click here to read more about building a dental team.

Dental Practice Marketing

Building a successful dental practice involves more than just providing quality dental care. It requires effective marketing, patient retention strategies, and a focus on growth. In this section, we will explore some key strategies that can help you establish and grow your dental practice in the UK.

Click here to find out more about marketing a dental practice.

Make sure to ask the seller about the marketing relationships they’ve forged during their time at the practice. Ask them what ways they’ve advertised in the past, and if there were any open accounts with dental marketing specialists that you could utilize.

Firstly, marketing plays a crucial role in attracting new patients and creating awareness about your dental practice. Using both traditional and digital marketing methods can help you reach a wider audience. This may include creating a professional website to showcase your services, implementing search engine optimization (SEO) techniques to improve your online visibility, and using social media platforms to engage with potential patients.

It is important to check what their online presence is at the moment. How high does their practice rank in google in their area among dentists? Do they already have brand-awareness online? Do they have a large following on Facebook or Instagram that you can leverage?

In addition to attracting new patients, focusing on patient retention is equally important. Building strong relationships with your patients is essential for their loyalty and long-term satisfaction. Implementing strategies such as personalized communication, offering loyalty programs or discounts for returning patients, and providing excellent customer service can go a long way in ensuring patient retention.

Moreover, growth should always be a part of any dental practice. This can be achieved through various strategies, such as expanding your range of services to meet the changing needs of your patients, investing in advanced dental technologies that enhance patient experience and outcomes, and actively seeking referrals from satisfied patients.

It is also crucial to continuously evaluate and analyze your practice’s performance. Regularly reviewing patient feedback, tracking key performance indicators (KPIs), and making necessary adjustments based on the data can help you identify areas for improvement and make informed decisions to drive growth.

By implementing these marketing, patient retention, and growth strategies, you can position your dental practice for success in the competitive UK market. Remember, building a successful dental practice is an ongoing process that requires dedication, adaptability, and a commitment to providing excellent dental care to your patients.

Click here to read our article on How To Market A Dental Practice

Using a Specialist Dental Solicitor

Placing an attractive offer on your future dental practice is one of the most essential elements in completing a successful purchase. After all, if the seller doesn’t like your proposal, they will simply move on to the next buyer – there is no prize for second place.

To ensure that your offer is fair (to both you and the seller) we always recommend enlisting the services of a professional dental solicitor. A good solicitor will carry out due diligence, negotiate the property aspect of the deal and look at the NHS contract with you. In essence, they make sure all of the t’s are crossed and i’s are dotted, so you don’t have to.

A specialist dental solicitor will:

• Analyse all existing contracts, including employment, lease, customer, and supplier agreements, ensuring they are legally sound and transferable.
• Identify potential legal issues or liabilities that could impact the business post-acquisition.
• Ensure the purchase agreement reflects your interests and includes necessary warranties and indemnities.
• Confirm the business complies with all relevant industry regulations.
• Review lease agreements to ensure favourable terms and conditions.

It is important to research the right solicitor for your transaction. Check in with colleagues to see if they have any firms that they’ve used in the past, do your research, and interview several providers until you find the “right fit” for you.

By joining the Samera Alliance, we can put you in contact with our legal partners for their help in buying a dental practice.

Click here to find out more about the Samera Alliance.

Conclusion: Final Thoughts on Buying a Dental Practice

In summary, exploring the dental practice market in the UK needs careful thinking and thorough research. Buying a dental practice is a big investment and a decision that should be taken seriously.

Firstly, it’s important to conduct a detailed analysis of the market and identify potential areas for growth and profitability. Understanding the local demographics, competition, and demand for dental services will help you make an informed decision.

Moreover, seeking professional advice from dental practice consultants, accountants, and experts is highly recommended. These experts can guide you through the legal, financial, and regulatory aspects of buying a dental practice, ensuring a smooth and successful transition.

Additionally, assessing the current patient base, practice reputation, and infrastructure is essential. Look for practices with a solid history, positive patient reviews, and up-to-date equipment that aligns with your vision for the future.

Funding options should also be thoroughly explored, whether through traditional lenders, dental-specific lenders, or seller financing. Having a well-structured financial plan will contribute to the long-term success of your dental practice.

Finally, don’t forget the importance of effective marketing and building strong relationships with your patients. Use various marketing strategies to attract new patients and retain existing ones, such as online presence, referral programs, and patient education initiatives.

In conclusion, successfully buying a dental practice in the UK requires a combination of strategic planning, due diligence, and professional guidance. By carefully considering the key points highlighted in this guide, you will be better equipped to make informed decisions and embark on a rewarding journey as a dental practice owner.

Our Expert Opinion

“Over the last 20 years I have personally been involved with several hundred dental practice purchases. From first time buyers to large corporate groups, I have seen most things across the accountancy and financial spectrum.

Many inexperienced buyers, feel they have to offer the price the vendor wants for the practice, whilst sometimes the price may be justified, often it isn’t, so when you start your journey of buying a dental practice, it is imperative to get some help in the process.

I would recommend the following steps when buying a dental practice.

1. Think hard about the location, type and size of practice you are buying – NHS/Mixed or Private? For your first practice don’t underestimate if you have to travel quite far the impact this can have on your life. Some better deals maybe available away from the main cities, but this often means you having to compromise on lifestyle -it has to be a very personal decision.

2. Early in the process understand how much you can borrow with the deposit you have in place. If you don’t have a deposit, start saving early. Get in touch with the Samera Finance team, they should be approached early on as they will be able to help you understand the maximum you can borrow and hence the size of practice you can purchases.

3. Register with all the agents on the market and as I mentioned before be quite ruthless about what you want to buy. Don’t be pressured by any of the agents, as remember they are being paid by the vendor to get the best sale price.

4. Go and see as many practices as possible – the more you see the better the idea you will get as to what you like but more importantly don’t like.

5. If you like the look of a practice, ask the agent for up to date accounts and information. If up to date information is not available, ask the question why not? If the vendor is serious they could at least spend a few thousand pounds to provide some transparency to you.

6. Once you have the required information, it’s imperative to analyse this and assess what the practice is worth to you. Do your own sums, or work with a firm like ours, who has done this so many times. This is the opportunity to offer a price that works for you.

7. Of course there may be some negotiation but eventually a price maybe settled on, however, this is still near the beginning of the buying process and a lot can still change!

8. Lawyers will need to be engaged and heads of term drafted which outline the deal value and structure. Once these are agreed the proper due diligence begins.

9. At this stage too, you will need to decide how you will be funding the purchase, again speaking to our finance team.

10. Whilst legal and clinical due diligence occurs, one of the most important aspects that needs to be carried out is financial due diligence. Do the numbers presented actually represent reality? This is so important as things may be found that can provide you the opportunity to re-negotiate the price. Unfortunately I have seen some dentists ignore this step at their peril, only realising after they have taken ownership that they have been ripped off!

11. Once all the legal aspects have been covered, then the legal exchange and completion occur, and then you have the excitement of being the new owner of your dental practice!

It’s a long process, and requires tenacity, and of course paying for professionals who know what they are doing.

Don’t cut corners on probably one of the biggest investments you make in your life, as this may come home to roost if you do!

Good luck and get in touch with the Samera team who can help”

Arun Mehra FCA

Samera CEO

You can book a free consultation with Arun here.

Buying a Dental Practice FAQs

Reviewed By:

Arun Mehra

Samera CEO

Arun, CEO of Samera, is an experienced accountant and dental practice owner. He specialises in accountancy, financial directorship, squat practices and practice management.

Nigel Crossman

Head of Commercial Finance

Nigel is a former banker and head of commercial finance at Samera. He specialises in raising finance, negotiating deals and structuring finance applications for healthcare businesses.

Dan Fearon

Finance Manager

Dan is a former banker and the head of our dental practice sales team. He specialises in asset finance for healthcare businesses and dental practice sales.