Names for dental practices have been on my mind lately: practices named for the doctor, practices with progressive sounding names, practices with comforting sounding names, and practices with, well, just odd sounding names.
Being a practice appraiser, I’ve not necessarily been thinking of practice names because of their marketing advantages or drawbacks. Rather, I’ve been asking myself, what’s the value of a practice name? How much monetary value can an Assumed Business Name (“ABN”-a practice name other than that of the doctor) be assigned during an appraisal, especially during an ownership transition? How much good will does it really contribute to the business?
The benefits of an ABN are obvious for a practice transition. While the practice may change owners, there is no need to change the name of the business, thus leading to increased stability and decreased patient attrition.
However, I would suggest never-changing a practice name for the sole purposes of trying to increase practice value prior sale or transition. It takes years to build good will in a practice name, so it’s unlikely to benefit the practice sale.
Even if a practice you’re considering purchasing is a sole proprietorship named for the doctor, that doctor’s name can continue to provide good will to the practice for a year or more after the transition.
There are many considerations the practice owner should review when choosing a business name, but I suggest that a pending practice sale should never be one of them.
