Understanding the value of a dental practice is essential for dentists who are planning to sell, merge, or seek financing. But how do dental practice valuations work? A valuation determines the fair market value of a practice by factoring in financial data, patient metrics, and unique characteristics of the business. Learn key insights and methods used to value dental practices in our guide: How Dental Practice Valuations Work .

Dental practice valuations matter for several reasons. Practice owners need an accurate valuation to plan for selling, merging, estate succession, or even bringing in new partners. Buyers need valuations to compare practices and ensure they’re making a sound investment. An accurate valuation allows both parties to proceed with confidence.

Several methods are used to determine a practice’s value:

Each method has its strengths, but using multiple approaches can provide a clearer picture of true practice value.

Accurate valuations require an analysis of both tangible and intangible assets:

To conduct a proper valuation, dentists need to provide detailed records, including:

Valuation Costs and Accuracy

A dental practice valuation requires time and expertise. The cost typically ranges from $7,000 to $20,000, depending on the practice size and complexity. While some free estimates may exist, they often lack thorough analysis and accuracy. Investing in a quality valuation is worth the expense for peace of mind and informed decision-making.

Dental practice valuations involve analyzing financials, patient metrics, and market factors to determine fair market value. Understanding how valuations work helps dentists make informed decisions when planning to sell, merge, or grow their practice. By working with professionals and providing detailed records, dentists can feel confident in their valuation and its accuracy.

This is a guest blog post from Jared Ripplinger, CPA, MBA, CFP®, CVA, at CMP, Utah Accountants..