The two conflicting challenges of doing a dental office appraisal are 1) establishing a "Fair Market Value" and 2) providing the client with a satisfactory sale price.
Generally, a dental practice appraiser is supposed to provide a Fair Market Value, which is, by definition, one that is just and reasonable for all parties involved.
However, each party comes with their own wants and needs with regards to the establishment of a practice value (usually a purchase price). And it is generally the Practice Owner who contracts with and pays the appraiser.
Usually...
- The current owner wants a high value.
- The potential owner wants a low value.
- The divorcing owner wants a low value.
- The estate of the deceased dentist wants a high value.
- The associate wanting to partner in the future wants a low value.
It is, of course, the appraiser's responsibility to understand the various forces pulling him or her in opposing directions, while trying to maintain an independent point of view.
I'd be interested in any comments or experiences sellers or buyers of dental practices have had in regards to whether the Fair Market Value from their appraiser seemed fair or biased.
Best wishes for a happy and safe holiday season!
Todd Christensen
Dental Practice Appraiser
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