How to Sell Your Dental Practice
Specialized M&A guidance for dentists considering a practice sale. Understand your valuation, navigate DSO interest, and plan a successful transition.
The Dental Practice Market for Sellers
Dental practices are among the most actively acquired healthcare businesses, with strong demand from Dental Service Organizations (DSOs), associate dentists seeking ownership, and private equity platforms. The combination of recurring patient revenue, essential healthcare services, and favorable demographics makes dental practices attractive to multiple buyer types.
DSOs have become the dominant buyer for larger practices, offering competitive valuations and allowing dentists to either exit completely or remain as clinical employees post-sale. Associate buyers using SBA financing remain active for smaller practices, particularly those under $1M in collections.
Practice value is driven by collections, profitability, patient retention, location quality, and the age of equipment. Practices with strong hygiene programs, a diversified payer mix, and modern facilities command premium valuations.
Current State of Dental Practice M&A
What's driving buyer activity and valuations in the Dental Practice sector right now.
DSO Consolidation Continues
Dental Service Organizations are actively acquiring practices across the Southeast, particularly those with $750K+ in collections. DSOs offer competitive valuations and often allow owners to stay on as clinical directors with reduced administrative burden.
Associate Buyer Pipeline Strong
SBA lending for dental practice acquisitions remains robust. Associate dentists with 3–5 years of experience are actively seeking ownership opportunities, creating a healthy buyer pool for smaller practices.
Specialty Services Increase Value
Practices offering implants, orthodontics (Invisalign), or sedation dentistry command higher multiples due to increased revenue per patient and differentiation.
Digital Dentistry Premium
Practices with CBCT, digital impressions, and CAD/CAM technology are more attractive to buyers who value efficiency and patient experience.
What Buyers Look for in a Dental Practice Business
Understanding these value drivers can help you prepare your business and command a higher multiple.
Active Patient Base
A healthy number of active patients (seen within 18 months) who return regularly for hygiene and treatment is the foundation of practice value.
Hygiene Program
A strong hygiene department with high recare rates generates predictable revenue and fuels restorative treatment opportunities.
Modern Equipment
Digital X-rays, modern chairs, and updated sterilization equipment reduce capital expenditure needs for the buyer.
Payer Mix
A balanced mix of PPO, fee-for-service, and managed care reduces concentration risk. Heavy Medicaid reliance can lower valuations.
Location & Facility
Visible, accessible locations with adequate parking and modern buildouts are significantly more valuable than basement or strip mall practices.
Staff Retention
Experienced hygienists, assistants, and front desk staff who will stay post-sale are critical to practice continuity.
How Dental Practice Businesses Are Valued
A clear explanation of how multiples work and what drives your number.
The SDE Method
Most Dental Practice businesses under $5M in revenue are valued using Seller's Discretionary Earnings (SDE). SDE represents the total financial benefit to a single working owner — essentially, net profit plus owner salary, personal expenses run through the business, depreciation, and one-time costs.
Once SDE is calculated, it's multiplied by an industry-specific multiple (typically 1.5 to 2.5 for Dental Practice) to arrive at an estimated business value. The specific multiple depends on revenue size, growth trajectory, customer concentration, and the value drivers listed above.
What About EBITDA?
There is also the EBITDA method — Earnings Before Interest, Taxes, Depreciation, and Amortization. Unlike SDE, EBITDA does not add back the owner's salary and is typically used for larger businesses ($5M+ revenue) with absentee ownership or multiple locations. We're showing SDE here because it applies to the majority of owner-operated Dental Practice businesses.
Example Valuation
Who Buys Dental Practice Businesses?
Different buyer types bring different deal structures, timelines, and pricing.
Private Equity
PE firms acquiring Dental Practice companies as platform or add-on investments. They typically pay the highest multiples, especially for businesses with $500K+ SDE.
Strategic Acquirers
Larger Dental Practice companies expanding geographically or adding capabilities. They value your customer base, team, and territorial presence.
Individual Buyers
Qualified individuals using SBA financing to acquire their first or next business. They want a stable, profitable operation they can manage.
How Selling Your Dental Practice Business Works
A proven five-step process designed to protect your confidentiality and maximize your outcome.
Confidential Valuation
We assess your financials, contracts, equipment, and market position to determine a realistic value range.
Preparation & Packaging
We prepare a Confidential Business Review (CBR) — a professional document that presents your business to qualified buyers.
Confidential Marketing
Your business is marketed to our buyer network. Every buyer signs an NDA before receiving any identifying information.
Negotiation & Due Diligence
We manage incoming offers, negotiate terms on your behalf, and guide you through buyer due diligence.
Closing & Transition
We coordinate with all parties to close the deal and support the ownership transition.
Common Challenges When Selling a Dental Practice Business
Being aware of these issues early lets you address them before they cost you money at closing.
Owner Is the Practice
If patients are attached to you personally rather than the practice, retention post-sale is a concern. Introducing an associate dentist before selling can help transition patient relationships.
Aging Equipment
Outdated operatories, analog X-rays, or aging chairs trigger buyer concerns about near-term capital needs. Updating equipment before sale — or pricing accordingly — is essential.
Lease Concerns
Dental practices require landlord cooperation for lease assignment or extension. A short remaining lease term or uncooperative landlord can complicate or kill a deal.
Staff Dependency
If a key hygienist or office manager is considering retirement or has no employment agreement, buyers will factor that risk into their offer.
Dental Practice Business Sale FAQs
How much is my dental practice worth?
Dental practices typically sell for 65–85% of annual collections, or 1.5× to 2.5× SDE. Practices with strong hygiene programs, modern equipment, and diversified payer mixes command the higher end of that range.
What's the difference between selling to a DSO vs. an individual dentist?
DSOs often pay higher prices and offer employment arrangements post-sale. Individual dentists (often using SBA loans) may offer lower prices but provide cleaner exits. The right buyer depends on your goals.
How long does it take to sell a dental practice?
Most dental practice sales take 6–12 months. DSO transactions can move faster (4–6 months) while SBA-financed individual buyers may take longer due to loan processing.
Will my staff keep their jobs?
In nearly all cases, yes. Buyers acquire practices in large part because of the trained team. Retaining hygienists, assistants, and front desk staff is a buyer priority.
Do I need to stay after selling?
Many DSO transactions include a 1–3 year employment agreement where you continue practicing at reduced administrative burden. Individual buyers typically request 30–90 days of transition support.
How is seller financing used in dental practice sales?
Many dental practice sales include 10–20% seller financing, where you carry a note for a portion of the purchase price. This can help a buyer qualify for SBA financing and often results in a higher overall price.
When should I start planning to sell my dental practice?
Ideally, 2–3 years before your target exit date. This gives you time to optimize financials, update equipment if needed, reduce owner dependence, and position the practice for maximum value.
Why Work With John Salony
Experienced M&A advisor serving business owners across the Southeast.
"John made the entire process feel manageable. He understood our industry, found the right buyer, and negotiated terms that exceeded what I thought was possible."
Ready to Explore Selling Your Dental Practice Business?
Schedule a confidential, no-obligation conversation. We'll discuss your goals, timeline, and what your business could be worth in today's market.
