003: Neal Inscoe – How to Properly Transition Your Dental Practice
Welcome to another episode of The Dentalpreneur Podcast. On today’s show we’re talking with Neal Inscoe. Neal is the founder and CEO of Equity in Dentistry. He specializes in helping dentists transition their practices either by outright sale or partnership.
In this episode Dr. Mark Costes and Mr. Neal Inscoe will discuss, how to properly transition the dental practice you spent your life building in a variety of ways that will allow the transitioning dentist to come out on top. Neal explains where a lot of dentists go wrong in transitioning their practice and how to avoid those costly mistakes.
All of that and more on today’s episode of The Dentalpreneur.
More About This Show:
Neal and Dr. Costes met almost a decade ago at a conference in Florida where Neal and Dr. Costes were both speaking. Neal is a golf pro who ran multiple golf courses where he learned firsthand about business.
Neal also worked in real estate development and for big business firms like Pacific Mutual Financial Planning. Neal’s first business sale was of a dental practice, where he saw a need for the seller to have a real financial planner. Neal has now helped dentists transition their practices for eight years.
In this episode you’ll hear:
- How can you find the right future partner?
- Where are the best places to look for potential buyers for your practice?
- When and how to start planning your transition out of your dental practice.
- What’s the most profitable way to sell your practice?
- How to avoid unnecessary taxes when you sell or take on a partner
Neal goes into detail on this episode about:
The four major types of transitions, and the pros and cons of each.
- First is the Sell and Walk Away. This is a situation where the dentist sells his practice and stays on for only a short period of time to transition the practice between the dentists.
- The second is the Reverse Associateship. This is where the doctor sells his practice but stays on as an associate. This usually happens because the selling doctor has not put away enough money to retire.
The great thing about this transition is it helps the existing patients to see the partnership of the new and old doctors, which builds trust among the patient base.
The unattractive part of this transition however is that the previous dentist might not like the new policies of the now owner of the practice and refuse to follow new policies. That is why these details need to be worked out prior to transition.
- The third is Practice Expansion, Partnership, Group Expansion. This transition is generally the most lucrative of all the transitions for the dentist. This is where the dentist only sells part of the practice. This transition requires, protocols, interviews, testing, and trial periods.
- The last one is the multiple practices approach. This is where a dentist sets up multiple practices to run as a group.
This transition takes a lot of planning and preparation. The dentist buys multiple practices and runs them using the same protocols and management.
In this transition the dentist becomes less of a health care practitioner and more of a manager.
When looking for these practices Neal recommends thinking about what you don’t want first such as high overhead. You then want to look for practices with value and one you know you can expand.
When a dentist does want to do a partnership, Neal has a very specific interview process that allows him to find the right partner for the practice.
- First Neal advertises what the doctor and practice is looking for.
- Then the potential partners interview with Neal and answer about ten to fifteen questions that allow Neal to pre-qualify the potential partners before they meet with the doctor. This allows Neal to save the doctor time by weeding out the applicants who just don’t fit the practice and doctors needs.
- Next is the in office interview where the potential partner can tour the office, spend the morning working in the office and getting a feel of the patients, and spend the afternoon meeting with the staff.
- After that Neal makes every potential partner take the Hartman Value Test to evaluate that person’s personality.
- Then the there is the meeting with the spouses so that all the expectations are out in the open from both parties.
- Finally there is the offer and trial period of the partnership.
Lastly Neal talks about how to avoid over paying in taxes after the sale of all or part of your practice. Neal advises to always do tax calculation ahead of time to identify exactly how much taxes you are going to have to pay. Neal also gives multiple ways to avoid certain taxes all together.
There’s a whole lot of great information on this episode, thanks to Neal Inscoe. As always thanks for joining us. See you next time on The Dentalpreneur podcast.
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- Email Neal at email@example.com for your free consultation.
- You can also reach Neal on his cell: (858)344-5110 or at his office number: (760)749-1037
- You can also visit Neal’s website: equityindenistry.net
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