As we continue to attract new clients who are looking to buy or sell dental practices, I’m noticing that not much has changed: dentists still see accountants as paper pushers rather than people who could be an asset to them when they are making the biggest business deal of their lives.

More owners are looking to sell since the Covid-19 crisis. They’ve had enough and want out. We support sellers by doing financial modelling and getting clear on how profitable the business is, and where vendors have multiple sites we get this information on each site. Where you make improvements to profitability as a vendor you see that multiplied by four or five times when you sell. We look at business performance, honing in on areas they can improve on with a focus on how the practice will be valued by buyers and their agents.

We analyse the tax structure during a sale — the one area where opportunities to save tens, even hundreds of thousands of pounds are consistently missed by workaday accountants. We saved Chris Stafford £200k on the sale of two practices (which was most of his profit), which he explains in a testimonial video in this blog.

We help people reach a provisional offer with a view on the changing tax landscape. For instance, we’ll advise you that you’re better off dropping your price now to get a quick sale because closing a deal before impending Capital Gains Tax changes will save you more than you lose.

We know it’s lonely being a principal, so we’re here to be a sounding board and raise things you might miss. When you’re in the thick of it and feeling stressed it’s normal to become focused, even narrow minded, and think, “My practice is worth £xxx,xxx, and so I won’t settle for less.” While that approach is understandable, it won’t always serve your best interests.

For more on our thinking around this here’s our DENTAL PRACTICE SELLER’S GUIDE.

Our advice is probably worth the most to associates looking to buy. We want to know why they’re buying and what they ultimately want: more time, money or freedom? This happens on a Discovery Day. We make sure (if they talk to us before buying) that any action is aligned with their deepest goals. It’s so easy to get side-tracked and begin making compromises. You really do need to be held accountable to your own deepest goals to make sure you honour them. For instance, the security of an NHS contract might seem appealing but it might be misaligned with your goal of clinical excellence or revenue growth.

We assess the price of the practice an associate is looking at to try to understand whether it’s really worth it. We do forecasting so that we can see, if they were to buy it, and take a loan to fund it, what life would be like: how many years would it take to pay off, and how much would they have to grow the business? This gives clarity and comfort that it really is financially viable and fits with their lifestyle goals. Many, when faced with the prospect of six day weeks for five years and minimum 40% growth won’t proceed. And they shouldn’t if it’s not right for them. Our consultancy service supports these conversations, so with Hive you have a multi-disciplinary team that specialises in dentistry at your back.

For more on our thinking around this here’s our DENTAL PRACTICE BUYER’S GUIDE.

Two things to leave you with: First, if you don’t have the right tax structure you’ll end up paying 30% more tax than you need to. That means if you borrow £500k you’ll waste £150k in tax. Second, if you’re an associate and you don’t want to buy now but in five years, you could save your money in a limited company and pay no tax on it. Many don’t think this far ahead and pay tax as a sole trader as they save. For example, an associate on £120k saving £40k a year could save £70k over five years.

If you’d like to know more about how we can support you with the big stuff, get in touch for a free chat.