If you're a doctor, dentist, optometrist, veterinarian, attorney or CPA looking to sell your professional practice, you're probably navigating confusing waters. You might not know how to prepare, where to look, or how to price it. Hopefully these tips offer you some clarity for how to do so in order to get the highest return, and how to keep you clients while in the process.
Look to Sell When Your Business is Thriving
The time to sell your professional practice is not when the business is in decline. Ideally, you should be selling when the business has solid financial footing; this will increase the amount of interest, and up its worth. A business that is struggling in retaining clients or profits is unattractive to any buyer, and doesn't coincide with a large price tag. It is important to be proactive, look ahead, and to not lose sight of the end goal in anticipation of retirement or a career shift. While buyers value potential, they shell out the big bucks for history.
One of the best things you can do beforehand is ready your business for potential buyers. This means updating any old systems you may be using, hiring a professional cleaning service, and updating outdated equipment. Have a clear breakdown of your client data and make sure anyone could easily understand your systems in place, and ensure that they add value. If a buyer feels that they will need to place too much time and energy getting your practice up to speed, they will lose interest. This is especially important if you are still using paper charts and files; in this case, invest in an EHR (electronic health record) system as soon as possible. Converting from paper to EHR is an enormous task that buyers won't want to waste their time with.
Invest in an Accurate Appraisal
It is extremely important to do your research and review multiple appraisers before hiring- you want to get the best and most accurate return on your business. Be sure that you hire an appraiser with experience in your industry, and one who has great reviews from past clients. They should ideally get you a high return where you make a profit, but do not appraise your business so high that no one is willing to purchase. It is a good idea to look at comparable sales on your own as well. Conduct some research on recent sales of similar practices in your area.
Where to look and Listing Services
Ready to sell but not sure where to begin? Start by interviewing a few Brokers/Consultants who have the experience and knowledge of value and pricing of your practice in order to not only get you the maximum amount you want but also to be competitive in an ever changing market. Ask if they use a multiple listing service or do they just list on their own personal web page. These listing sites will expand your exposure in front of your target audience and get your listing in front of more potential buyers who are actually interested.
Lastly, make sure the transition runs smoothly for you, your clients, and the buyer. This can be done several ways. Many individuals hire their eventual successor months or even years before they officially sell the practice, so the clients and other employees feel comfortable with them. This builds rapport and ensures that practices remain consistent. Another idea is staying on as an employee for several months post-sale. You can be there to oversee any changes and demonstrate how practices are carried out. Again, this will ease the transition and customers won't feel abandoned. To keep customers well- informed and feeling taken care of, it is also important to market the change, as well as the idea that the quality and care will not lessen. Invest in some transitional marketing and be transparent through the switch. Evoke optimism and your clients will too!
Hopefully these tips have helped you through the process of selling your professional practice.
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