Market Appraisal FAQ
Unfortunately, while we do factor in the depreciated equipment value in our practice market appraisals we do not have the expertise or experience needed to look at this in isolation.
Practice Sale Search market appraisals are based on our unique perspective of the market forces of supply and demand and other sales that have recently happened in similar circumstances. We do not have this same insight into the market for second hand dental equipment.
Practice Sale Search does not do practice site visits for its market appraisals for three reasons:
- Having the financial documentation and the registration forms is enough for us to create a practice market appraisal.
- It would almost certainly be prohibitively expensive for the practice as there would be additional costs in terms of travel, accommodation and the valuer's time.
- A site visit would be of little value. Practice Sale Search would be unable to vouch for the working condition of the equipment, the quality of the furnishings and fit out, nor the accuracy of much other information provided by the seller about the practice.
In order to complete an accurate market appraisal we require the following documentation:
- A market appraisal registration form completed comprehensively (click here).
- Profit and Loss statements for the last 2 years.
- A practice Depreciation Schedule.
- Any other purchases or refurbishments in the last 5 years not already listed in the registration.
This depends on the completeness of the information that you provide and the current availability and workload of the valuer within Practice Sale Search.
Usually it can safely be completed inside 2 weeks.
Practice Sale Search will go through the details and contact you with an expected completion date.
Nearing the completion date, Practice Sale Search will schedule a time to debrief the market appraisal document, after which, the document will be mailed to you.
Practice Sale Search is committed to valuing a practice objectively regardless of the persons agenda that engages our services.
We maintain this objectivity by not acting as a broker. Dental practice brokers act as real estate agents for the dental industry. They help selling practices in return for a percentage of the practice sale price (around 5%). While Practice Sale Search do assist dentists with practice sales we do not act as brokers and have a flat success fee rather than a percentage of sale price.
A valuer who charges a percentage of the practice sale price for success would lose some objectivity as they could possibly have incentive for the value of the practice to be higher.
A formula or 'Rule of Thumb' value for a practice value is calculated as a % of the last 12 months gross or net income. It is the result of an average for practice market appraisals and sales seen in the dental industry.
We cannot provide practices with a formula for valuing their practices.
Using a formula or 'Rule of Thumb' market appraisal alone could provide inaccurate results and miss some hidden wealth or liability of the practice. A practices value will naturally fluctuate over time and could be influenced by factors not considered by using a formula including (but not limited to):
- Security of tenure in premises
- How clinically specialised is the work done