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    Goodwill hunting: Branding and tax implications

     

    Dentists have the unique opportunity to forge long-lasting relationships with their patients, and much of the reputation of a practice is inextricably tied to the dentists themselves. It’s important to maximize the practice’s value when it’s time to sell, and having all of its brand equity wrapped up in the primary dentist’s name means one of the practice’s most important assets isn’t transferable.

    Furthermore, it means any young dentist considering purchasing that practice knows he or she will have to take on a considerable up-front marketing burden in addition to the price of purchasing and financing the practice and any equipment/facility upgrades.

    More from Naomi Cooper: 7 tips for using social media to reach patients of all ages

    Imagine the fictional Dr. Pat Price, who is 30 years old and shopping around for a practice in Springfield. There are two practices up for sale in town with nearly identical locations, patient bases and facilities. Practice A is named Jess Jones DDS after the long-time dentist/owner. The practice’s website comes up on the first page of search engine results for dentists in the area, but the URL is drjonesdds.com and its signage and business cards all reflect the retiring doctor’s name. The practice’s Facebook page and other social media profiles, as well as all of its overwhelmingly positive online reviews, are also all listed under Dr. Jones’ name and worthless to young Dr. Price, as a result.

    Dr. Price knows if he is to buy Dr. Jones’ practice, the cost of a new logo, internal and external signage, a new practice website and printed materials like business cards and letterhead alone will easily rise into the mid-five figures. Add to that the cost, including the time and energy, of rebranding the practice, building a new website and starting the practice’s social media and online review profiles from scratch and putting the necessary marketing infrastructure into place for this practice starts to feel like a part-time job the new dentist won’t have time for.

    Practice B, on the other hand, was rebranded several years ago as, let’s say, Main Street Dental Care. Its website needs a simple update to the doctor’s photo and bio page to be perfectly good for Dr. Price’s immediate needs. The practice effectively has all of the necessary marketing assets already established in an easily transferable brand, and it’s easy to imagine how much more attractive Practice B appears to Dr. Price as a result.

    Related reading: Top 5 signs you need a marketing consultant

    Continue reading on Page 3 ...

    J. Haden Werhan, CPA/PFS
    Feel free to contact J. Haden Werhan, CPA/PFS, principal and owner of Thomas Wirig Doll, an accounting and wealth management firm that ...
    Naomi Cooper
    Naomi Cooper is President of Minoa Marketing and CEO and CEO and co-founder of Doctor Distillery. Naomi is a respected dental marketing ...

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