Practice Appraisal

To determine the value of a practice, many aspects are taken into consideration. The office financials and the effort put into building it are examples of aspects that affect its value. Having detailed information about the practice provides a good picture for the prospective buyers and enables them to make a decision.

A practice appraisal utilizes objective information and examines many elements of the practice.

What an appraisal incluse

The practice appraisal reflects the financial aspects, the character, personality and decor of the practice. A practice appraisal provides the prospective buyers with the details and information they need to enable them to make a decision as to whether to follow through with the due diligence phase of the decision-making process. The appraisals are professionally presented for a complete and easy access by the attorney, the accountant, the lending institution and most importantly the prospective buyer

There are different types of appraisals for different circumstances that occur in the life of a dental practice:

• Practice Sale (now or in the future) An appraisal would provide a reasonable price for a seller to ask for the practice. Although you may not be contemplating a sale in the immediate future, a current appraisal would establish a benchmark price now for future reference and point out some areas that may need attention and upgrading to enhance the value of the practice.
• Purchase of a practice: An appraisal provides the potential buyer with an independent and unbiased opinion of the value of the practice before he/she buys the practice.
• Partner's termination: An independent third-party appraisal is the best means of determining value for the purpose of the termination agreement.
• New partner: Bringing in an associate or partner into your practice.
• Personal net worth determination: This may be important to add to your financial statement for investment purposes or for a loan that you require.

Other reasons for an independent appraisal may include divorce, death of the owner-dentist, associate buy-in, and estate planning.