How to choose a dental practice broker in NJ
Most business brokers have never sold a dental practice — and most New Jersey dental sellers are approached first by someone who is not neutral: a DSO’s own development officer, whose job is to buy your practice on the best terms for the DSO. Dentistry is also one of the few businesses where the headline price and the money you actually receive routinely differ, because so much of the consideration is structured as post-close employment, earnout and rollover equity. The broker you want has a defined dental practice, works this market, and represents you rather than the buyer. Here is what to test for — and you should hold us to every one of these.
1. Do they work from collections rather than production?
Production is what you charged. Collections are what you kept after contractual adjustments and write-offs, and collections are what a buyer will underwrite. On this page we put NJ general practices at roughly 65%–85% of trailing-twelve collections, or 4×–6× EBITDA for group and DSO-ready practices. If a broker quotes you a percentage of production, the number is inflated, and the correction arrives during diligence rather than at the listing meeting.
2. Can they read your hygiene department as a business of its own?
Hygiene production as a share of total production is one of the first things a DSO underwriter looks at, because hygiene is the recurring, doctor-independent part of a dental practice — it keeps producing when the owner is not in the chair. A practice where the owner-dentist personally produces nearly everything prices as a job; one with a strong, well-scheduled hygiene department prices as an asset. Ask any broker to show you that split before they quote you a number.
3. Do they know your active patient count and new-patient flow, and can they defend both?
Active patients — those seen within the last eighteen months — and new patients per month are the two figures a buyer verifies straight out of your practice-management software rather than your tax return. They are also the two most commonly overstated. A broker who has sold dental practices will pull those reports before going to market, so the number in your listing is the number that survives diligence.
4. Can they price your PPO participation?
Two practices with identical collections do not sell for the same figure if one is deep in low-reimbursement PPO plans and the other is substantially fee-for-service. Your in-network fee schedules set your margin, and margin is what the multiple gets applied to. Ask specifically how your payer participation moved the percentage-of-collections figure you were quoted, and what it would be worth to renegotiate or drop a plan before sale.
5. Do they know what each buyer type actually pays for — and can they run both?
There are two real buyer pools and they behave differently. DSO and DSO-backed buyers in New Jersey generally want $1M+ in collections, healthy EBITDA margins and a seller-doctor willing to stay two to three years; they pay on EBITDA. Private doctor-buyers are typically bank or SBA-financed, buy smaller practices, and pay on a percentage of collections. Those are not two prices for one deal — they are two different transactions, with different structures, timelines and post-close lives. A broker who only knows how to run one of them will steer you into it.
6. Will they walk you through the structure, not just the price?
This is where dental sellers get hurt. A DSO offer commonly splits into cash at close, an earnout tied to your future production, rollover equity in the parent company, and a post-close employment agreement with its own compensation formula. Each of those carries a different risk and a different probability of ever being paid. Ask any broker to show you an offer broken into what you receive at closing, what is contingent on your own future work, and what depends on someone else eventually selling the parent — before you sign anything.
7. Do they understand how NJ dental ownership has to be structured?
Dental practices in New Jersey are subject to professional-ownership rules, which is why corporate buyers are generally structured through a management-services organisation: the clinical entity stays dentist-owned and the buyer owns the management company that supports it. That structure shapes what you are actually selling and what the transaction documents look like. You want a broker who understands it going in and who will work alongside a New Jersey healthcare transactions attorney rather than around one.
8. Can they show you the valuation math instead of just a number?
Ask to see the work: the add-back schedule, how hygiene and doctor production were separated, the collections percentage or multiple applied and why, and what your payer mix did to it. The valuation ranges, buyer profiles and deal-killers are published on this page precisely so you can check our math against anyone else’s — including ours.
Questions worth asking any dental practice broker, including us
- What are my trailing-twelve collections, and what percentage of collections are you quoting me?
- What share of my production comes from hygiene, and what does that do to my multiple?
- How many active patients do I have, and how many new patients a month — from the software, not an estimate?
- How is my PPO participation affecting the number you just gave me?
- Am I a DSO practice or a doctor-buyer practice, and what would I net under each?
- If this is a DSO offer, how much is cash at close, how much is earnout, and how much is rollover equity?
- What does my post-close employment agreement actually commit me to, and for how long?
- What is your fee, when is it earned, and is there any circumstance where I owe you money without a closing?
If a broker cannot answer those on a first phone call, keep looking. Ask us those questions on a free confidential valuation — there is no fee and no obligation, and you will get the math rather than a pitch.
