05 Jan New Year’s Resolution 2024: Sell My Practice
The beginning of a new year is always filled with goals, resolutions, and excitement. If selling your practice is at the top of your list for 2024, you may be wondering “how do I start?”. Here is a simple list to help you get started:
- Gather all your financial information for the past three years. This includes tax returns, Profit and Loss Statements, Balance Sheets, payroll reports, and practice software reports that show income sources (services, treatments, inventory), inventory levels, and doctor production. If you are starting the process mid-year, you will also need to all year-to-date reports as well. This information will be the foundation for your listing price and sale.
- Review any leases (equipment, real estate, etc) and lab agreements you have in place. (Be ready to share these with your broker and buyers too.) Ensure the leases and agreements are transferable upon a sale and understand the penalties if they are cancelled early. A buyer may assume your leases and agreements but is not obligated to.
- Review your loan balances. All loans must be paid off at the time of sale (buyers won’t assume these and the practice must be lien-free at closing). You won’t need to pay them off early; they will be paid off at closing with the sale proceeds. It is important to know these amounts to ensure the sale will cover all the payoff amounts you have.
- Tidy up! Just like selling a home, you want your practice to look nice for visiting buyers (and photos!). Declutter desks, shelves, and countertops. Get rid of old equipment/inventory that is collecting dust and taking up space. Touch up paint and clean up the landscaping. Not only will your buyers like it, but I promise, you will too!
- Understand the timeline. Selling your practice can be a long, tedious process. If you’re listing your practice to attract a veterinarian buyer, it may take up to a year or more, contingent on your location (non-urban areas take longer). Veterinarians in search of practice acquisitions often have distinct preferences and understanding these preferences can expedite the sale process. Alternatively, if you’re considering a sale to a corporation, the process can be much shorter, typically around six months. However, be ready to commit to post-sale employment of up to three years.
- Contact a veterinary practice broker to list your practice and assist in the sale. A broker will determine your practice asking price, market your practice, negotiate on your behalf, and guide you through the contracts and closing. They will also help you find the right attorney experienced in veterinary transactions. Steer clear of brokers who handle a variety of business types or promise to find you a buyer but leave you to do the rest on your own. These options may sound cheaper, but it will cost you much more in the end, both financially and emotionally.
If you are ready today, or want to learn more, contact Kate Owens, DVM, MBA, CVA at Simmons Intermountain. [email protected] or (303) 729-0870. As a veterinarian and practice broker, she has the experience and knowledge to help you achieve your 2024 goal.
This is a paid sponsored content article from Simmons and Associates – Intermountain.