Are your deal breakers saving you or holding you back?
When it comes to big decisions, such as buying a house or even finding a future spouse, people tend to have their list of “deal breakers” – the desires or parameters that will make them pass up on the opportunity almost immediately.
This dynamic is no different in the dental transition world. As buyers search for a practice, or sellers seek a buyer or partner, most people have deal breakers in mind. For buyers, this could be anything from the physical look of the practice, type of technology to the practice’s insurance mix. For sellers, it’s often about finding the individual with a specific age, gender, personality, skill set or another type of characteristic.
It’s certainly important for people to understand their preferences and aversions, but what many don’t realize is that often, their picture of the perfect practice or person going into the process can often change by the time the transition finalizes.
Even more so, buyers and sellers tend to have their eyes fixed on certain aspects, distracting them not only from other options but from the bigger picture.
“It’s important to dig a little deeper before ruling any opportunity out,” NDP Partner Christy Ratcliff said. “If people have too many deal breakers or their parameters are too strict, they could truly be limiting themselves from other available opportunities and finding the “right” person or opportunity.”
The question for buyers and sellers to ask themselves is this:
Do these deal breakers serve as helpful parameters, or are they holding you back from finding your match?
BUYERS: Dig Beyond the Surface to Find the Ideal Practice
At the beginning of the practice search, most buyers’ deal breakers typically revolve around the practice’s location, clinical style or the finish out. They look to see if the practice is in a location they love, if they have the experience to do the type of dental work, if the practice has the look and feel that they want. Additionally, buyers may even focus on whether the technology is up to date or what type of insurance the practice takes.
It’s completely normal to have preferences here. Especially with the big-picture items, such as general geographical location, buyers will want to make decisions based on their preference as this will impact more than their work life. For example, life will look different when selecting a state or region that’s close to family or friends. However, it becomes problematic when the buyer makes a quick pass on the practice because it’s not, for instance, in a preferred neighborhood or suburb.
“Oftentimes, there are buyers who are pretty quick to walk away from the deal if the practice isn’t exactly what they initially had in mind,” NDP Senior Listing Specialist Catriona MacLachlan said. “Rather than try to investigate further and see if they can make it work.”
The key here, when looking at any opportunity, is to take in all the facts and look beyond the surface.
“If it’s a great practice with great profitability, and it just has a few things the buyer doesn’t love about it, I would encourage him or her to look at how they can change those things,” Christy said. “The practice a doctor buys doesn’t have to stay exactly the same for the next 35 years, and honestly, it shouldn’t. Maybe in this moment it isn’t exactly as they envisioned, but it has the opportunity to turn into it.”
Perhaps the practice is older and not as modern, but a quick cosmetic lift and small investment in technology could make a huge difference. Maybe the practice is heavy on PPO, but the buyer envisioned a fee-for-service practice, and the area supports it. Over time, the buyer could create a plan to strategically drop insurances.
Remember, as a business owner, you have the ability to control your own destiny and build on the practice’s foundation to reflect your dream. And sometimes, all it takes is a call or meeting with the seller to see the doctor and practice in a new light. Having a connection or level of trust can help buyers to see a different perspective and consider the practice as a good fit.
SELLERS: Widen the Search to Find the Ideal Buyer
On the seller side, practice owners typically look for a specific type of person, and they often seek buyers who have similar characteristics to their own. They try to search out individuals who are just like them in terms of personality, gender, nationality, religion or even music taste. Others center their deal breakers around factors like clinical skills, the dental school they attended, their marital or family status or traits based on who will fit best with the patient base.
However, just like in a buyer’s situation, deal breakers can also cause problems for sellers. Maybe the seller only seeks a partner whose personality matches theirs, or perhaps they want a buyer of a specific ethnicity to fit in with the common ethnicity of the patient base. Perhaps they want an individual who’s married because the buyer likely won’t find a spouse in the rural area.
“Sometimes, sellers get hung up on wanting everything, or they cling onto certain things instead of asking themselves, ‘what is the ultimate goal?’” Catriona said.
It’s expected that sellers may have specific desires based on their unique situations, but while it’s important to have priorities in line, sellers should also be aware that having a specific set of parameters can limit their pool of candidates. They could be missing out on some great candidates who would be the right fit for their patients and staff, and they may not even know it.
“We want to make sure the seller’s patients and staff are cared for, and we want them to be proud of that practice five years down the road when they drive by it,” Christy said. “At the same time, if their goal is to sell it completely, we hope the seller is not so selective that they dwindle the buyer pool down to nothing.”
In many cases, it’s just a matter of time before the seller begins to budge on their deal breakers and becomes more accepting of other options. But what if within that time, they miss out on great opportunities?
Sometimes, a connection can ignite when sellers least expect it and they take a chance to talk to a prospective buyer who doesn’t fit their exact criteria. Many candidates are worth looking into before walking away so quickly.
THE KEY TAKEAWAY: Keep an Open Mind
Deal breakers are beneficial for laying down a path, but the buyer or seller’s ultimate goals should be the main drivers. Buyers and sellers should be aware of what truly matters to them and the factors that have significant impact on their goals.
Instead of trying to check all the boxes, it’s encouraged to prioritize deal breakers and understand if they’re actually factors that will make an individual walk away or if they’re willing to be flexible.
Be open to exploring all types of opportunities. Dig deep and take the time to understand the situation in order to make an educated pass as opposed to an “on-the-surface-level” pass. There are typically other possibilities than what is seen on the surface.
As a dental transition advisor, NDP can help guide you through your unique situation and shed light on your options for transitioning in or out of a practice. Reach out to our team for a complimentary call.