How and When to Tell your Staff about the Sale of your Practice
Timing is important in the sale of your practice. You have to correctly time when to start the financing, have the buyer start the credentialing process with insurance companies, tell your landlord about the sale-almost everything needs to be time correctly. When to tell the staff about the sale is definitely on this list. Some dentists dread is telling the staff they sold the practice and are leaving and want to wait until the sale is complete to tell them; others want to tell the staff immediately, sometimes even before the practice is listed or before they find a buyer! Whichever end of the spectrum you fall in, you must make sure that you time this conversation correctly to avoid a negative impact on the sale of your practice and the future success of the buying dentist.
Although very early or very late in the sale process might be your natural instinct of when to tell your staff, it may not be the best time to tell them to ensure a successful sale and transition. Sometimes the staff can be more important to the buyer and goodwill of the practice than the selling dentist. The employees at the front desk are the people patients see first, they are the ones that call and schedule and remind them of appointments; the patients spend a great deal of time during the visits with the assistants and hygienists and they are the ones that truly know how the office works. Telling the staff too early gives your employees too much time to worry about the new doctor and can cause them to leave for another position. It also gives them time to be tempted to reveal to someone outside the staff your plans for a sale and once one person outside the office knows, all confidentially is lost and cause patients to leave, among other complications. You also don’t want to give the staff too much power in deciding which buyer to choose. By telling the staff too early you run the risk of them talking to the buyer outside your presence, and scaring him or her off by being too dominant or trying to do too much to solidify their position in the practice.
Alternatively, putting off telling the entire staff until the sale is final can cause adverse effect as well. By waiting until the sale is final you run the risk of angering the staff if they think you didn’t tell them because you didn’t trust them, didn’t think they could keep the sale confidential or that you just didn’t care about their feelings regarding a sale and new owner doctor coming into the practice. This may cause an adverse attitude towards the new doctor by the staff which could spell disaster for the buying doctor. He or she needs an open attitude from the staff and has to be given a chance. If the staff quits, has a bad attitude when patients are in the office or is disrespectful to the new owner it will be very difficult for the new doctor to adjust to the office, get to know everyone and make positive changes to the office.
Because of this, you want to ensure you tell the staff at the proper time. This is not an exact science and the best time is different for each practice. Some doctors need help generating reports for prospective buyers and rely heavily on an office manager so they may have to tell one staff member early in the process. Doctors in a small, close-knit community may want to wait longer so word doesn’t get out to the general public too early. A practice with large percentages of PPO and Medicaid patients will need to tell the staff sooner as the buyer will need their assistance getting credentialed with all of the insurance companies. Telling your staff about the sale is a very delicate matter and you should always consult with Practice Impact when making the decision about this timing.
In almost all cases you should wait to tell your staff until you have a serious buyer whose offer you have accepted, who has been approved for financing and who has signed the purchase agreement. Once you are ready to tell the staff of your decision you should call a staff meeting to tell them and then to introduce them to the buyer. This will be a big announcement for you, but chances are the staff will already have an idea that you are selling the practice. They work with you every day and probably know you well enough to see that you are getting tired of the daily grind and are looking towards retirement.
You will be surprised at how well the staff responds to your news as long as you put it in a positive light. Although they may be sad to lose you and have some skepticism regarding the new doctor, Practice Impact has found most employees to be excited for the change and embrace it. It is a chance for them to voice their opinion to the new doctor about what works in the office and what they want to change. They may also have a chance to work additional hours as many new, younger doctors expand the office hours when they take over. Even the most loyal employees to you, the ones you thought would only work for you will almost always stay with an open mind and give the new doctor a chance as long as you put a positive spin on the situation.
Below we have composed a list of some things you should say to the staff when informing them of the sale. If you have any questions about what to say or when to say it, please contact Practice Impact.
- “I want to be the one to tell you. I did not want you to find out this information from outsiders who are contacting the office, sending letters, etc.” Blame your broker and attorney for not telling the staff sooner.
- Tell the staff the reasons why the deal had to be kept from them, i.e., loan approval, insurance approval, real estate, etc. “Many issues had to be cleared first.”
- “I can’t tell you all of the details yet, but I have been informed that Dr. BUYER wants to keep as much as possible the same, including employee benefits.”
- “As your current employer and friend, I ask you to please be patient with the new doctor. He is a fine young doctor and he/she will be able to run the office effectively.”
- Dr. BUYER is expected to conclude the sale on July 1st. He/She will be meeting with all of you on the 3rd and will have answers to all of your questions at that time.
- ASK THEM AGAIN TO BE PATIENT with the new doctor. “Everything will work out fine.” Reassure them, the facts are clear and buying “new” doctors do succeed.
- VERY IMPORTANT: In closing the discussion with the staff, let them know that you have met with Dr. BUYER numerous times and that you feel very comfortable with Dr. BUYER and that you have every confidence in his/her abilities as a dentist and employer.
- Try to use Dr BUYER’S name as much as possible. This will help the Staff better understand him/her as person rather than a stranger. Talk a little about Dr BUYER, his family, his background & his education
- Discuss the fact that you will be there for a while post-closing and that you will help Dr BUYER integrate with the staff & patients. Try to explain your role in the transition
- Emotions!!!!! There will be emotions that are expressed at this time. Be yourself!! Some of the staff will shed tears, other will give you congratulations. In the end, everyone will understand your situation.