THE POSITIV NEGATIVE PR
There is the negotiation and sale you intended (or hoped) to have, the one you actually had, and the one you wished you’d had 3–12 months afterward. Success rarely moves in a straight line, so a serious conversation
patients who love you, so your practice’s “goodwill value” is above par, prove it with retention, hygiene frequency, patients upgrading from short-term fixes to full transformations, and referral statistics. Show the endless chain of referrals from each patient. Show the SYSTEM you have for high patient enthusiasm: your post-treatment concern call script, your new patient welcome “wow” box, your monthly print newsletter, birthday recognition, and so on, all in place, ready and easy for your buyer to step into and operate. Emphasize that all the software, vendors, and suppliers are trained and in place, ready to do the buyer’s bidding. BE INSULT-IMMUNE. DON’T TAKE IT PERSONALLY. DON’T LET YOUR EMOTIONS DISTRACT YOU FROM YOUR MISSION. Be especially ready for the tough questions. Your re-cast financials identifying the salary and expenses the practice pays for a “no work job” for your son, daughter, or mistress. A past complaint to the state board or bad Yelp reviews. A big slump in revenue for three months a year or two ago. How much of the practice depends on you, so, uh-oh, what happens when you’re gone? That last one is a question I’ve had to deal with several times as the business I built and around me was sold. It was kind of like Disney removing the live characters from the parks — what, no Mickey? No princesses? I knew it would be raised, so I raised it first. I knew it would be a cause of anxiety, so I had a multipoint reassurance. Because I was well prepared, it quickly became a non-issue. In fact, I successfully argued that the cure for it added value. A tough question is only that, not necessarily an insult or criticism. And even if it is that, so what? You can insult me as long as you spell Kennedy with two n’s and a y on the check. Your task is to anticipate every possible question you might be asked, so you are never caught by surprise or made to look unsure of yourself. You don’t want to merely be glib, either. You cannot dismiss their concerns. You need relevant facts for an acceptable answer. Question: Your fees seem frankly exorbitant, and I doubt they can be sustained. The fact that you’ve been closing cases and adding new patients at those exorbitant fees is not enough. How is it that you are able to consistently secure higher fees than most? How are your fees presented? What tools are used, like beautiful before-and-after and testimonial books? Have you had celebrity or famous patients in town? I recently reworked an old, classic ad headline for a dental specialist: Where Do Dentists Go For <Specials>? If, on the other hand, I say (or might silently think) your fees are too low but wonder whether they can be raised, how can you reassure me on that count? IT’S NOT JUST MATH — AT LEAST, DON’T LET IT BE Many dentists, many buyers, and, frankly, even many brokers want this to be just about math. Gross, EBITDA, a few other stats, standard multiple, bingo: Price, then subtract for things that can be found to chip away at it. It’s a
with a possible buyer will often start well but then begin zig-zagging, with strange detours, more information required again and again, and by the end, the buyer’s case for a much lower valuation and selling price than was originally, tentatively agreed to. The more time you invest in moving the deal forward, the more eager you become to “win” by getting it across the goal line, so the more concessions you are willing to make. This happens routinely. Skilled deal-makers know all this, and a lot more, about the process, the rabbits found and pulled out of holes that change the equation, the weary seller extremely reluctant to walk away from the deal “almost done” to start all over again with a new potential buyer, so the seller agrees to concessions on price or terms or both. Good divorce attorneys dealing with affluent couples’ separation know and use all these same methods. In business deal-making, “normal and customary due diligence” is a euphemism for digging for gold, something to get concessions with. If you have a lot of nice things throughout your home, including on low shelves, and somebody is coming to visit with unruly kids, you can’t fix the kids. You can only prepare your home to survive them. You put some things up high, you lock other things away. You think “negatively” about what those kids might get into, bump into, or knock over, so you can prepare smartly. The same thing is true here. Most buyers and their agents and their deal-killing lawyers are going to, from your perspective, behave badly. You can’t fix them. But you can prepare for their shenanigans. BE YOUR OWN WORST ENEMY FOR A WEEKEND, WITH YELLOW LEGAL PAD AND PEN The defense against the finding of problems, flaws, questionable items, and every other piece of dirty laundry hidden in drawers of your practice is to find it all first. Prepare to have it raised. If possible, preempt it from being raised. But do not allow yourself to be surprised or to be dragged along lowly, one “negative” raised after another. Do not live in denial, thinking: ‘What could anybody possibly dislike or question or be critical of or turned off by in MY utopian practice or my impressive financials?’ Every deal made is imperfect. Every practice sold has some fleas. Sit on the other side of the table. Be a fearful, anxious potential buyer. Be a skilled financial and business detective. Nit-pick every fact, figure, claim, and assertion about the practice’s history, present condition, and future forecast. Do it until you are exhausted. Rest. Resume. Be the cynic who, if just told the sky is blue, says: Prove it. If you assert that you have a sizable herd of loyal
10 · DentalGrowthAndExit.com
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