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Articles

Volume 15: How to Select an Appraiser for Your Practice

Download the PDF version now!

There are several reasons to have your practice valued:

  1. For sale purposes
  2. For matrimonial purposes
  3. For estate and or retirement planning
  4. To value the practice when an associate starts
  5. To secure a loan from the bank
  6. Insurance purposes

Most practice sales are based upon a valuation which may be a quality valuation or not. How do you know if a practice valuator does quality work? There are several steps a practitioner should undertake to ensure the professional valuator does quality work. My suggestion would be to ask several different sources for their recommendation, do not rely on only one or two.

Sources for recommendations:

  1. Your accountant, if he has several dentists in his portfolio, can give you their experience of different appraisers. Your accountant is not an independent appraiser and would not be recognized as such to purchasers or banks.
  2. Other dentists who have gone through valuations for the same reason. This is an ideal source because there is more than the value of the practice to be considered. Such other attributes as: was the value accurate; did they do the job they were hired to do; did you feel the appraiser/ agent represented them well?
  3. Your lawyer, if he has several dentists in his portfolio, can give you their experience with different appraisers.
  4. Your investment / retirement planer, if he has several dentists in his portfolio, can bring you up to a better awareness of the difference in appraisers.
  5. Your bank manager. This is an important contact. If the banks do not accept the valuers report because they are not on an approved list of valuators then another costly valuation must be completed to get the financing for the purchaser to purchase your practice. Some banks have only two or three approved dental appraisers. Ask your banker who is on the approved list for their bank.
  6. Interview the potential appraisers to ensure that you feel comfortable with their experience, professionalism, and ability to set a value that will be accepted by purchasers, accountants and bankers. A high cost for the valuation does not necessarily insure a quality report.
  7. Ask to review a generic valuation to see if you understand the value and how that value is derived.

In the end you should feel comfortable with your appraiser and the job he is engaged to do, be it a matrimonial valuation or a valuation for sale purposes. In the end, you should expect the appraiser to be able to set a value which is achieved in the case of a sale.

The Professional Advisory

  1. One Year Later

  2. Dealing with Unsolicited Offers

  3. Covid-19 Practice Sales Update

  4. When is the Right Time to Sell Your Practice and Why?

  5. Partnership Pitfalls

  6. The Real Cost of a Dental Practice Set-up

  7. Smaller Practice Realities

  8. Dental Market Update - 2019

  9. Creating Your Own Most Valuable Practice (MVP)

  10. Small Practice Economics

  11. The Market is Very Efficient

  12. How Can Dental Practice Values be Rising and Declining?

  13. Hygiene as a Value Driver

  14. The Value of a Good Team

  15. Is it Time to Move?

  16. Staging A Dental Practice

  17. The High Cost of Dying

  18. Deal-Busters

  19. Patients - Attract and Retain

  20. Should I Stay or Should I Go?

  21. Is There a Buyer for Every Practice?

  22. Good, Better, Best - The Market has Spoken

  23. Smooth-Sale-ing

  24. Buying Time

  25. Patients, Patience, Patients

  26. A Real Patient

  27. Why Do a Practice Valuation? I'm not Selling

  28. Irrational Exuberance or The New Normal?

  29. Do dental equipment and dental technology affect a practice value?

  30. Finding and Being a Mentor

  31. Bigger is Better

  32. Dave's Top Ten List for Buyers (Vendors should read this too!)

  33. How Well Do You Know Your Practice?

  34. Dave's Top Ten List for Vendors

  35. What will happen to dental practice Values in the next 10 years?

  36. Your Premises Lease is an Important Asset

  37. What are Associates Thinking?

  38. There is Life Outside the GTA

  39. When Is the Right Time to Sell My Dental Practice?

  40. Mergers are a Viable Option

  41. Is Your Associate an Asset or a Liability?

  42. Has your Practice Facility Kept Up With Your Billings?

  43. The 100 per cent of Gross Myth

  44. The Past, The Present and The Future

  45. Caveat Emptor

  46. Overpaid Long Term Staff

  47. Selling your Practice in Stages

  48. A Potential Pitfall of Selling Shares

  49. Value in Your Practice Through Balance

  50. Only Trusted Staff Can Defraud You

  51. To Own or Not to Own Practice Real Estate? That is the Question.

  52. Coping With A Large Patient Base

  53. Successful Dental Practice Transitions

  54. Taking Care of Business

  55. The Investing Dentist Phenomenon

  56. Two areas to focus upon that could negatively impact the value of your practice

  57. Organize your Debt in Order to Sell your Practice

  58. Having a Better Team

  59. How Do I Prepare My Practice For Sale

  60. How Do I Prepare My Practice For Sale? Part 3

  61. How Do I Prepare My Practice For Sale? Part 2

  62. How Do I Prepare My Practice For Sale? Part 1

  63. Advice to My Son or Daughter Graduating from Dental School

  64. Transition - What to Expect

  65. Discussion on Digital X-Rays

  66. Partnerships and Shotguns

  67. Strategic Planning - How to Get Started

  68. Calling All Vendors - Practices have Gone Up in Value

  69. Purchasers: Expect to Pay More for a Practice because of Lower Professional Corporation Tax Rates

  70. Matrimonial Practice Valuations

  71. Purchaser's Guide to Affording a Practice

  72. Location Improvements Throughout Your Career

  73. Small Practice Valuations

  74. Partnerships – The Best and The Worst

  75. Changing Location When the Opportunity Comes Along

  76. Visual Presentation of Your Practice

  77. Presentation of Charts

  78. Your Premises Lease Can Be Your Worst Enemy

  79. How to Select an Appraiser for Your Practice

  80. How Are Your Billing Ratios?

  81. It Pays to Invest in Your Tangible Assets

  82. The Importance of Separate Financial Statements

  83. Five Time Frame Levels to Sell a Practice

  84. 12 Suggestions to Safeguard Computer Data

  85. How to Buy a Visible Practice

  86. Why is there a shortage of good practices today?

  87. The Importance of Equipment in the Purchase of a Practice

  88. The Balanced Practice

  89. Will My Practice Be Saleable in The Future?

  90. Buyer Be Aware

  91. Excess Profit - The Second Key

  92. Patients and Profits are the Keys

  93. Plan Ahead

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