Practice transition through the eyes of the dental team
Letting the team in on the deal generally goes over better
Many dentists hire dental brokerage firms to help them with the sale of their practice, and for a successful transition of their practice to a new practitioner. They rely on their broker for advice and guidance.
But how will this impact the dental team?
The confidential sale
The dentist and broker agree that the prospective sale of the practice should be kept confidential. The dentist does not inform anyone on his or her team regarding the impending sale of the practice. This is done to protect the practice from patients catching wind of the sale and possibly finding a new dental provider, or not consenting to lengthy treatment due to the fear that they will be transferred to another dentist to finish the work. Finally, keeping it quiet is to protect the different offers that the practice is entertaining from potential buyers.
Usually the buyer adds in an open-ended deal where he or she is willing to retain the existing dental team. Therefore, the selling dentist does not feel that he or she must inform the team about the sale because they’re in no danger of losing their job.
Sounds like a good idea, right?
The dental team is never going to see the secret as a good idea. Imagine walking into work one morning and seeing a new dentist, and the doctor that you’ve worked with for years tells you that the practice has been sold and that you’re now employed by a new dentist. You would feel betrayed and resentful for not being told the truth, and you’d feel like the selling dentist was dishonest and didn’t care about you by “selling” you to a stranger.
Next, you will have the stress of learning how the new dentist wants the office run. There is also the very strong chance that there will be personality conflicts, where team members will either quit or be terminated. If this occurs, the blame will fall on the selling dentist. This doesn’t even take into consideration the reputation of the selling dentist when team members tell others in the dental community that the practice was sold out from under them.
The open sale
An open sale is when the dentist is forthcoming with his or her team about the intention to sell. He or she will ask for their discretion regarding discussing the impending sale of the practice with patients. The staff will probably be sad that the practice will be sold, but they feel like they’ve been given notice to seek other employment if they want. They appreciate and respect the honesty of the selling dentist. The downfall of this route is that some employees quit trying to go the extra mile because they feel it will be of no use since the practice is being sold.
I recently had the opportunity to interview three doctors regarding their personal practice transitions. Two of them did confidential practice sales, and one of them was open with his staff and told them from the beginning about his plans.
The dentists who did confidential sales regretted their secrecy and felt like they had let their team down. One dentist had an open-ended deal with the buyer that the team would remain in place. Within two weeks of the sale, the new dentist terminated the staff that had been in place for over 16 years. This devastated the selling dentist and he said that his team now “hates” him for the manner in which the practice was sold. The other dentist has deep regrets for not telling his employees, and claims he was only doing what the practice broker advised him to do. The relationships that these dentists had with their team members became damaged.
The dentist that was open with his team had the best results. They were obviously disappointed and anxious that the practice was going to be sold, but they felt prepared. It’s never easy to have to transition and learn to do your job to another dentist’s standards.
Dentists are not taught in dental school how to sell a practice. This is something for which they rely on brokers. The broker does not know your team, and does not have to deal with your team and the consequences of how the sale will impact your team. My best advice is to assess your team and decide which route would work best for your practice — open or confidential.
CONSIDER READING:Five red flags to watch for before buying a dental practice
CONSIDER READING:Make more money with a sale-leaseback on your dental practice
Angela Donovan is a Certified Dental Practice Management Administrator through the Dental Assisting National Board. She has over 20 years of dental practice administrative experience. She is currently employed by Leif K. Bakland, DDS, in Gloucester, MA. She is the Project Manager for the North Shore Study Club, and serves as a committee member for Delta Dental of Massachusetts Office Managers Advisory Council (OMAC) and DenteMax OMAC. She is also an active member of the American Association of Dental Office Managers and the Association of Dental Implant Auxiliaries. Contact her at firstname.lastname@example.org.