Hello ralphie,
Thank you for your question.
I searched [appraise dental practice] and found many links. I have
located the following information for you:
Epstein Practice Brokerage
http://www.dentalbrokernj.com/frames.htm
Here they define the appraisal process as follows:
"It takes a specialist to accurately analyze a practice for appraisal.
In order to determine a fair market value for the practice, we will
utilize our strong background in financial analysis of professional
practices.
In an on-site evaluation, we examine the many factors that determine
the worth of the practice. These factors include:
Gross and net income
Number of active patients
Office lease terms
Location
Transfer terms
Equipment and furnishings
Staff retention
Based on this data, we formulate a realistic practice value."
They are in New Jersey, and though I would not expect a dramatic
difference in cost for this service on the West Coast, they do not
list their fees for performing an appraisal. But their criteria for
determining value does seem reasonable for a beginning checklist.
ROICORP.co
http://www.roicorp.com/art49.htm
The Top Five Factors Affecting Dental Practice Values
Timothy A. Brown, A.L.A.
"On a daily basis, I am asked by accountants and lawyers to comment on
the methodology that we use to appraise dental practices. They ask me
to explain what factors affect practice value the most. While a
professional appraisal should consider hundreds of items, I believe
there are five key elements that impact practice value the most: cash
flow, gross income, asset value, patient profile, and location..."
A similar list to that above at Epstein.
He continues to further explain each element. Recommended reading.
Baccari and Associates
http://www.dentalbroker.net/serv.htm
"Appraising your practice is one of the most important and critical
steps in preparing to market your practice. After an on-site visit to
the practice, a thorough examination of all pertinent documentation,
and a complete analysis of the supporting information that contribute
to a practice's total value, we will prepare a concise, informative,
and objective valuation. Our formal written appraisals are readily
accepted by the major lending sources in the industry. In most cases,
we can secure 100% cash at closing for our sellers.
As part of a complete appraisal and valuation, we will also prepare
cash flow reports, a very important tool in assisting a buyer with
their decision to purchase by demonstrating and projecting what they
can net from the practice after paying all expenses, including their
loans for the practice. "
A cached page at Google lead me to a Los Angeles area broker:
http://216.239.53.100/search?q=cache:Hd94QzBQlPAC:www.dentalangle.com/01.98/kempler-archived.html+appraise+dental+practice&hl=en&ie=UTF-8
The company is Thomas and Fees Practice Sales, Inc and is headed by
Philip Kempler, DMD. They are reachable at 714-544-4341.
Their web page can be found here:
http://www.tfpsales.com/
"If you're serious about selling your practice give our office a call
at (714) 544-4341. We'll show you why Thomas & Fees is a "Better kind
of practice sales company."
Our Satisfied clients say it best:
"Phil did everything he promised and more. He got me a good price on
my practice and there were no surprises. As a dentist, Phil knew both
the emotional and technical sides of the dental practice. We got along
great!"
William King, D.D.S., Past Treasurer
Orange County Dental Society"
Philip Kempler, D.M.D., Broker
511 E. 1st Street, Suite C, Tustin, CA 92780-3333
Days (714) 544-4341 * Evenings (949) 362-4749
FAX (714) 731-7296
I called his office and they replied that only Dr. Kempler could
provide me with the average cost of a practice appraisal. I called his
home office and left a message for him. Being New Year's Eve, I may
not get a reply for a few days and will post when I do.
I then called a dentist friend of mine who sold his practice in
Oakland, CA a year and a half ago. He explains there seem to be two
ways to appraise and sell the practice. One, which he used, was a
Broker/Dealer that performs the appraisal and the sale and does not
charge separately for the appraisal, but takes a commission from the
total sale of 6-10% of the selling price.
The other was to obtain just the appraisal and sell the business in
other, perhaps private ways. In this case the cost of the appraisal
was based on numerous factors including the number of chairs, amount
of receivables, number of patients, etc. and had a range of $500-$1200
for just the appraisal at the time he inquired. Good information.
I then found Wintersteen and Associates at:
http://www.wintersteen.com/appraisals.htm
"Value of a Practice Appraisal
While many doctors think a Practice Appraisal is only for those who
are planning to sell their practice, the plain fact is that Practice
Valuations serve a variety of important functions in your profession.
For many doctors, their practice may be their most valuable asset and
a critical component of their retirement planning. Regardless of
whether you are a new doctor or long-established professional, it is
important for you to know the value of this investment. Like your
other investments, the value of your practice varies from one year to
the next. Contact Wintersteen & Associates to determine the value of
your practice when:
Planning your Retirement
Seeking to minimize stress and financial burdens upon your family in
case of accident or death
Planning and reviewing insurance needs
Planning your Estate
Measuring your practice's growth and stability
Refinancing loans
Selling your entire practice ("Walk Away")
Recruiting an Associate with a "Buy In" Option
Forming partnership, group, or solo group
Dividing community assets (Divorce)
Wintersteen & Associates thoroughly analyses your practice, including
financials, location, hard assets, patient charts, and goodwill.
Several methods are employed to find the value of the entire practice.
When finished, Wintersteen & Associates provides you with bound,
written reports for your use in any of the above-mentioned
activities... "
"While practices typically appraise for somewhere between 60-70
percent of collections from the previous year, individual practice
characteristics may cause it to be appraised above 100% or below 50%.
Some considerations involved in the practice appraisal include:
Business and Dental Equipment and condition
Fee schedule
History of goodwill
Managed Care or PPO Participation
Office Lease
Office location and condition
Practice profitability and growth pattern
Pending treatment in charts
Personnel "
I called and Larry Wintersteen answered the phone and was very
accommodating. Although he is in Boise, Idaho, he appraises practices
all over the country using highly targeted questionnaires, digital
cameras and sometimes visits from associates around the country to
view the practice.
He says that a solo general practice appraisal is done by his office
for a flat fee of $2,000 for a thorough appraisal. He notes that he
has seen the appraisal industry charge from, perhaps $1500 to $3500
for similar services around the country.
Should you wish to contact him, he can be reached at:
WRITE US:
Wintersteen & Associates / Wintersteen Transition Services
9703 Ustick Rd., Suite A
Boise, ID 83704
(208) 378-8181
(208) 378-1442 (fax)
Larry@wintersteen.com
I think the above information should provide you with guidelines of
what is included in the appraisal process and what charges you might
expect to pay for this service. If a link above should fail to work or
my research require further explanation, please do post a Request for
Clarification.
Best of luck appraising your practice.
Regards,
-=clouseau=- |
