Whether you are just considering selling your practice and are curious about what you might need to do, or you are ready to go for it and need to know where to start, you’re in the right place.
There are several ways of looking at how to prepare your medical practice for sale. They can be divided into:
Let's jump into each.
Before and during my time as a newly-minted practitioner, like most of us, I focused exclusively on how to build my practice. I’d think through all the ways I could improve it; all the ways I could build in efficiencies so I could do a better job and make more money while working less. I attended practice management and billing seminars. You know how it is.
But after ten years of a successful practice, I started to realize two things:
You don’t want to keep growing in size and complexity. There also comes a point as a practitioner of diminishing returns: you only have so much time and energy as a practitioner, and as a manager. Along with this...
As that second thought gradually crept into my conscious mind, it scared me. I had no idea what I would do if I wasn’t practicing medicine. But I knew at some point I had to consider it.
As the founder of one of the first practice management software companies, I used to run around the country on weekends not only talking about medical practice software, but also teaching medical practice management to medical students and practitioners. In those classes, I started to ask my students, many of them just on the cusp of starting their own practices:
What will you do after you have a successful practice? At what point will you be satisfied with your business? And after that, what is your exit strategy?
I was asking as much for myself as I was for them. And I was somewhat surprised to find that 95% of my students had never considered the “after” part.
If you’re still reading this, you are likely smack in the middle of considering the “after,” and chances are that you haven’t thought too far down the line beyond the sale of your practice.
Imagine some of these scenarios, how you might feel and what you might do, if:
These questions should be thought through carefully and discussed with those closest to you. If you and/or your family are of two minds about the answer to any of these questions, we recommend you work though those issues before you endeavor to sell your practice.
Even when everything goes well, your practice sells for an amount you are happy with, and you can move on with your life, many of us have not fully thought out what happens next.
The time to start thinking about this is before you ever start down the road of selling. The time is now.
Before you go too far down the road to selling your practice, consider the following factors and how you may remedy or explain them to a potential buyer. Remember that a buyer will be scanning for any kind of danger to their investment in what would be their new investment, and the following are issues to review:
A buyer of any sophistication will be looking at all of these variables, both tangible and intangible, as they decide if your practice is worth pursuing.
If any of these questions can be answered as “yes” or “maybe,” think of how you’d answer a potential buyer before you even start to search for one.
In our experience, the following are variables that make a practice more attractive and a relatively easy sell:
Of course, this is not an exhaustive list, but these are some of the factors that buyers will find attractive and those which you will want to focus on in the process of finding a buyer for your medical practice.
If you find any of these factors missing or lacking, think about how you can remedy them in advance of even beginning the process of selling your practice.
Having as much of these issues thought through and prepared before you get your first call from a prospective will go a long way to establishing early on that you are a savvy practitioner with a valuable practice—one that a well-qualified buyer will want to know a lot better.
While this post may give you a lot to think about, we’ve also created a free Presale To-Do List that you can download and go through in order to prepare for your sale. It goes through very specific tasks that you should have completed before you even start looking for a buyer. If you’d like to get it, let us know.
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