Whether it’s to retire, move away from the area or for another reason, if you’ve made the decision to sell your practice, there’s one thing for sure: you’ll be aiming to get the best possible sale price. And fair enough, too. You’ve no doubt worked hard to establish and grow your practice and would like to move on to your next phase with a purchase price that reflects everything you’ve achieved.
Location, patient numbers, and chair count are key factors in determining the value of a practice and what it ultimately sells for. There are also two variable factors that can make a big difference: how the practice presents and how it stacks up with respect to sterilisation compliance.
Buyers pay more for a practice that presents well and that they can step into and run from day one. A well-kept and compliant practice increases its perceived value. It signals that the business has been well run and looked after, strengthening its valuation before the books have even been looked at.
The opposite is also true. If there’s anything that indicates that spending may soon be required, such as a sterilisation room that needs an upgrade or a chair on its way out, the perceived value of the business is reduced, generally resulting in a lower offer price.
The good news is that money spent to address such things before going to the market will almost certainly return the amount outlaid and more; a lot can be achieved with selective and strategic upgrades in key areas.
A significant makeover would also impact sale price, but if that's simply not in your budget, spending money on the right things can make a real difference - especially if it results in a business that asks nothing of the new owner.
First impressions land in the reception and waiting areas, and a space that looks welcoming and well-kept will appeal to buyers.
After enough years in the same rooms, it’s easy to look past things that a visitor would notice as soon as they walk through the door. Take a walk through your practice as though it’s your first visit; look closely and take note of everything that could be improved. Whatever you notice, a buyer probably will, too!
Use the resulting list to decide what to prioritise for smarten-up or upgrade prior to sale.
If selling with older equipment is your reality, help give it the best possible impression by having service records and warranties well organised and ready for inspection. A buyer will feel reassured by knowing that things have been well-maintained and unlikely to require replacement as soon as they take over.
Compliance with the latest sterilisation standards is one of the key things a serious buyer will want to check, so you'll need to feel confident that everything is operating at the right standard. AS/NZS 5369:2023 has replaced the older AS/NZS 4815 and 4187, and the Dental Council's Infection Prevention and Control practice standard (2024 edition) now points to it as the basis for audits.
The current requirements are tighter than some owners are aware of, specifying new protocols such as the sorting of instruments into product families, more rigorous water quality monitoring, including bacterial endotoxin testing on the annual washer-disinfector audit, and a clear separation between dirty and clean reprocessing areas. We have covered these in our guide to the sterilisation standards.
A compliant operator will certainly benefit from being able to show good records and audit results, which counts for more in a due diligence file than almost anything else you can say. If you don’t have current audit results or if you have specific compliance concerns, consider getting an independent review. This would identify any problem areas, giving you time to address them before a potential buyer walks through the door.
A review would also be a good opportunity to consider whether the sterilisation area is functioning as well as it could. Are there things that you’ve become used to working around or putting up with that could be better?
One problem area we often see is with the requirement for separation between dirty and clean reprocessing areas. Older clinics often lack the physical space to separate the two workflows properly, so bringing one up to standard could require time for building work rather than it being just a weekend tidy-up. Building work does take time and money, but the compliance and process gains would be a big positive at the time of sale.
The best time to start the pre-sale process is well in advance of when you’re wishing to sell, ideally twelve to eighteen months out. That would give you time to make a full assessment, plan and phase the work, spread the cost, and go to market with everything already in order rather than patching things under pressure.
Compliance is the one area you cannot afford to guess on, and the simplest to prove when it is done right. Book a review with the Dentec team to confirm your practice meets the current sterilisation standards before it reaches a buyer's due diligence.