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HS Financial Services - Maximising profits and selling at the right time
Maximising profits and selling at the right time

It is hard for busy principal dentists and practice owners to find the time to step back and look at the bigger picture. An evening seminar held in London in April provided a fantastic opportunity for many to do just that and to listen to some expert advice in three key areas of business management and planning.

Practice profits and preparing to sell was organised and hosted by Mediestates, a Henry Schein company. The evening started off with drinks and canapés as everyone gathered together. The main business of the evening began with three short, informative talks from industry experts who challenged attendees to double their practice profits, make sure they are in a good position to sell their practice when the time comes, and maximise retirement income.

A key theme of the evening was it is never too early to boost the profits of your business and ensure it is ready when the time does come to sell.

How to double your profit
Kicking off the seminar section of the evening was Andy McDougall, who heads up the team at Spot On Business Planning. He gave a thought-provoking talk entitled ‘How to double your profit and your practice valuation.’

Andy suggested maximising profit has nothing to do with luck, and ‘everything to do with knowhow’. Practice owners should put together a three-year strategic plan to transform the profitability of a business. Business performance should be reviewed monthly and appropriate action taken to tackle weaker areas. By being proactive in this way and using an efficient structure, it is possible to double net profit every three years.

He went on to reveal some of the tools and techniques Spot On uses for achieving this and talked about the importance of calculating the net profit of each treatment.

Andy put a question to his audience, ‘five frogs are sitting on a log and four decide to jump off – how many are left? Well it’s five, because saying it and doing it are two different things.’ Putting jokes aside for a moment, he said, the five most dangerous words a practice owner can say are ‘maybe it will go away’. To remain profitable, it is essential to tackle problems head-on when they arise, and when you have made a decision on what to do, act on it straightaway.

Preparing to sell
The evening’s second speaker, practice valuation manager for Mediestates Alison Bates, gave a fascinating insight into ‘Preparing to sell; the journey and what to expect as a vendor.’

She started by detailing how the market for dental practice sales had changed over the last 15 years. The demand from dental buyers has increased over that period due to two forces that have transformed the market; changes in the NHS contract and the corporatisation of the market. For practice owners, the important consideration is where the journey will go next and what factors are likely to influence the market over the coming months.

Alison stated that practice values are at their highest level ever, and this trend is expected to continue for the remainder of 2019, with growing demand, particularly for private practices. ‘What is going to change?,’ she asked. ‘Brexit is already having an impact on recruitment of associates in more rural and coastal areas and a lot of corporates are struggling with recruitment as well.’

Alison stated the NHS contract reform will take a number of years to roll out across the country and ‘this will be the biggest thing to impact dental values across the sector’. She ended by highlighting the value of having an expert on hand, such as Mediestates, to guide practice owners through the lengthy and complex ‘minefield’ of the sales process.

Boost your retirement income
The final speaker of the evening, Tim Collyer, of Independent Financial Planners Montgomery Charles Wealth Management, tackled the subject of ‘Top strategies to maximise your retirement income.’

He told attendees that everything they do must be evidence-based, but the actual destination should be ‘dream-led’. In other words, dentists should work out what they want from their retirement and then make sure their business decisions can facilitate that.

A key theme of Tim’s presentation was recognising the best time to sell a practice. He advised delegates that the most important thing was to ‘invest in yourself’ by enlisting the help of experienced financial experts who can give you advice. This means ‘you can do what you do best, which is running the business’, while the financial professionals ‘do what they do best, which is looking after your money’.

Following all that food for thought, attendees were treated to a delicious three-course meal and an opportunity to mull over the advice with fellow colleagues. The evening was hailed a great success, and attendees left full of inspiration and new ideas to put into their own practices the following day. Mediestates regularly holds similar events on a variety of topics, including preparing for retirement and buying and selling a dental practice.

Posted by: MediEstates on

General Buyer Terms

This agreement is in relation to MediEstates Limited whose registered office is at 1st Floor, Pacific House, Stanier Way, Wyvern Business Park, Derby, DE21 6BF acting for and on behalf of our clients ("the Vendors"); and yourself (Buyer's Name) in relation for an introduction to a prospective sale of a business as a going concern. By registering through this agreement I agree to all terms set out below:

  1. Definitions
    In this Agreement the following terms and phrases shall have the following meaning unless the context otherwise requires:

    Business
    Dental Practice business providing dental care. This business is under the MediEstates Ltd sale terms.
    Confidential Information
    Means the actual Vendors identity and all confidential information in respect of the Business, including, but not limited to, any ideas, business methods, prices, accounts, finance, marketing, research, development, manpower plans, processes, market opportunities, intentions, design rights, product information, customer lists or details, employees’ details, trade secrets, computer systems and software, and other matters connected with the products or services manufactured, marketed, provided or obtained by the Vendor, and information concerning the Vendor’s relationships with actual or potential clients or customers and the needs and requirements of such clients’ or customers’ operations.
  2. Obligation of Confidentiality
    The Prospective Purchaser agrees to treat as confidential, information supplied by or on behalf of the Vendor in connection with the sale of the Business.
  3. Exclusions
    The obligation of confidentiality set out in clause 2 does not apply to:
    1. any information received from a third party who was legally free at the time of disclosure to disclose it;
    2. any information which was already lawfully in the Prospective Purchaser’s possession prior to receiving it from MediEstates Ltd on behalf of the Vendor; and
    3. any information which is in its entirety already in the public domain.
  4. Duties of Prospective Purchaser
    1. The Prospective Purchaser shall take such a reasonable security measures to protect the Confidential Information and trade secrets.
    2. The Prospective Purchaser shall not, without the prior written consent of the Vendor, permit any of the Confidential Information:
      1. to be disclosed, other than in confidence to its legal or professional advisors;
      2. to be copied or reproduced;
      3. to be commercially exploited in any way;
      4. to be used for any purpose other than in connection with the prospective purchase of the Business;
      5. MediEstates is registered under the Data Protection Act 2018. Upon Signing this agreement you agree to follow the legal obligations of this act to protect the details of the information supplied to you, with it no to be passed outside of the control of you the prospective purchaser.
    3. The Prospective Purchaser agrees to keep a record of Confidential Information received.
    4. The Prospective Purchaser will return to MediEstates or the Vendor all documents containing Confidential Information and all copies of those documents on demand at any time which are in its possession or under its control, and for this purpose the term “documents” includes computer discs and all other materials capable of storing data and information. The Prospective Purchaser agrees that such documents remain the property of the MediEstates on behalf of the Vendor.
    5. The Prospective Purchaser must not jeopardise or re-direct the sale under any circumstances.
    6. The Prospective Purchaser must not contact the Local Area Team or CCG regarding any practice sale, by any means of media unless written permission is granted from the Vendor.
    7. To carry out own due diligence on practice purchases and accepts that any information MediEstates has supplied is information provided by the vendor and is not responsible for its accuracy or completeness.
  5. This Agreement
    The existence of this Agreement and its terms are confidential and neither MediEstates nor the Purchaser may disclose anything about this Agreement or its subject matter or implementation to any person other than in confidence to their legal or professional advisers.
  6. Duties of Prospective Purchaser
    When buying Dental practices, finance is normally needed. Our organisation operated over more than one of the MediHoldings brand, by completing this from you agree that the information can be shared to our other organisations to avoid the need to register independently and provide the best possible service.

    MediEstates will refer you to the specialist dental lending team and MediFinancial who will contact the necessary banks, whom have preferential healthcare lending rates in some cases, to ascertain which funding is available to you.
    By signing this agreement you do not have to use any of the banks MediFinancial contact, it is just another service which we provide.
  7. Deposit for Dental Practice
    If you are interested in putting forward a formal offer in for a practice, once the offer is accepted there will be a deposit required to secure the practice sale which is dependant of the practice size. This deposit is held in a client account and will be returned to the buyer on completion of the practice sale. You the buyer, will be required to sign a deposit schedule which will cover the buyer and the seller in the event that the practice sale does not proceed.
  8. Changes to this Agreement
    Any changes made to this agreement must be authorised and signed by one of MediEstates Ltd Directors.
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