Transitioning from the academic environment of dental school, graduate school, or residency program carries with it a great deal of uncertainty and anxiety when it comes to entering private practice. Having spent years learning and perfecting their clinical skills, many young dentists enter into the world of private practice naïve of what awaits them in the business world. While in dental school, students have repeatedly been told to find a good attorney and accountant before signing any employment document or sale agreement. But how do you go about finding good professional help? The selection is an important one which may carry with it years of ramifications. The bottom line in the selection of anyone who is going to represent you is this: You don’t want them to be learning on you! Look for someone who has had experience in dental transitions and or associateship arrangements. Dental transactions are not a common event for most attorneys and accountants. You want someone who has been there done that numerous times.
Word of mouth can be a good starting process. Upon interviewing prospective attorneys and accountants, be specific on what you want them to do for you. Next ask them how many dental associate agreements/dental practice sales they have transacted. Ask for references. Likewise with the accountant, ask them how many dental clients they represent. Are they familiar with the industry business norms for dentists? Have they been involved in dental sales or associateship arrangements? Once again ask for references.
Our professional organizations, the ADA for example, may be of assistance as well. Likewise, state and local dental associations may be able to provide names of those who are familiar with dental associateship agreements and purchase agreements.
Perhaps one of the better ways of finding someone who is familiar with the legal and accounting needs of dentists is to utilize a dental transitions broker. Dental transition brokers will know of attorneys who can construct solid dental employment and or purchase agreements. Furthermore, they will be familiar with accountants who are members of the Academy of Dental CPAs to handle the accounting issues. The largest independent nationwide network of dental transition brokers is www.adstransitions.com.
A practical word of advice for both associate candidates and owner-dentists: We have seen many cases in which important points of agreement developed informally between would-be associates and owner-dentists are somehow revised or removed from formal contracts drawn up by professional advisors.6 In other words, it is fairly common for contractual-related information to not get successfully communicated to an adviser or for someone to make a mistake in codifying agreed-upon points. For example, the two parties agree on a base compensation of $110,000 with the owner covering all of the laboratory bills. When the associate candidate receives the contract, it specifies $95,000 in base compensation and calls for the associate to pay 1/3 of the laboratory bill. Such situations can obviously create unnecessary conflict. If this “failure to communicate” occurs for either party, it is best to resolve this in a calm and orderly fashion by talking with (NOT texting or emailing) the parties involved in a straightforward business manner. Use of conversation vs. electronic communication allows for a reading of nuanced nonverbal cues and a higher likelihood of successful management of the issues involved.