How to Prepare Your Veterinary Practice for Sale

As the practice owner, selling your practice will be more emotional and significant than other real estate or property. It is the product of your blood, sweat, and tears and will be your legacy to your community. 

When thinking about retirement, consolidating with another practice, or looking into new possibilities, it is important to carefully prepare for the sale. Like hospitals and medical groups for human patients, corporate acquisition of practices continues to accelerate.

This article will help you with the resources and information to begin your action plan for improving your business to maximize value and make for a smooth transition.

The Importance of Valuation:

Understanding the value of your practice is essential for establishing practical goals and bargaining successfully. A precise appraisal assists in making decisions and understanding market placement. Factors like location, size, staff, technology, and financial health have a significant impact on your practice’s fair market value.

Understanding the importance of your practice is beneficial for negotiating deals and planning for future expansion. Through the evaluation process, by determining strengths and weaknesses, you can establish specific goals that correspond with your practice’s capabilities. If your evaluation shows that there is a lack of performance because of old technology or inadequate staff training, you should focus on making enhancements in those particular areas.

Key Factors Influencing Value:

The financial factors are the biggest consideration in the sale of your practice, however, they are one part of the equation, there are other facets to consider. Factors like vicinity, customer characteristics, and rivals are key in affecting worth. Comprehending these components enables practice owners to establish achievable objectives, make well-informed choices, and optimize their practice’s capabilities.

Listed below are some examples of the main factors that can impact the valuation of a veterinary practice:

Financial Health: Profitability and stable revenue trends are primary drivers of practice value. Practices with strong financial performance typically command higher valuations.

Location: Urban practices often command premium prices due to a larger client base and growth potential.

Client Base: A loyal and expanding client base enhances value, indicating revenue stability and future growth opportunities.

Reputation and Brand: Having a good reputation and strong brand can greatly enhance the attractiveness of your practice to potential buyers.

Efficient operations: Utilizing technology and having a skilled workforce are viewed as low-risk investments.

Market Trends

In addition to clinics being bought by bigger companies, more veterinarians are realizing practice ownership can be a worthwhile investment. With this increased interest, it is imperative to understand the larger market forces that impact consumer actions. In this way, you can make sure that your practice stays competitive and appealing in a quickly changing environment. Ultimately, aligning with market trends not only boosts your practice’s current performance but also positions it for sustainable growth and success in the future.

“Even when the circumstances of a potential sale are ideal, unfamiliarity with the market and sale procedures can lead to hesitancy. Owners should not let it stop them from becoming a participant in the rapidly growing market for veterinary practice acquisitions.” – MB Law Firm

Steps to Pre-Sale

To maximize the value of your work, you want to ensure the practice is presented in the best way possible—running efficiently and profitably while looking the best it ever has cosmetically and operationally. This involves maintaining a pristine physical appearance and optimizing internal processes to enhance operational efficiency. Streamlining workflows, implementing modern technology, and training staff to deliver exceptional service can significantly improve the overall performance of your practice. 

1. Organize Your Financial Documents

Financial transparency is fundamental to being able to productively and efficiently get through the negotiation process with prospective buyers.

Gather Essential Records: Profit and Loss, income statement, balance sheet, inventory—all of your records, including inventory and vendors—all standard veterinary accounts & reporting. (AAHA/VMG)

Conduct a Financial Audit: Consider hiring another firm separate from your normal accountants to audit your financials. An audit will illuminate any areas you need to improve and issues to rectify.

2. Evaluate Assets and Liabilities

Looking at all of your practice’s assets and liabilities will give buyers the clear picture they will require. Reducing your liabilities, like loans, leases, and other debts while conducting an inventory of physical and intangible assets, like equipment, real estate, client relationships, and goodwill, will provide the information required at the negotiating table.

3. Enhance Curb Appeal and Marketability

The initial impact is important. Increasing the visual appeal and attractiveness of your practice ensures that it will catch the attention of potential buyers, leading to a faster and more lucrative sale.

Facilities: Investment in essential upgrades and maintenance for your facility to maintain a professional appearance. Buyers’ perceptions can be greatly influenced by a well-maintained facility.

Professional Environment: Create a welcoming atmosphere with cleanliness, modern equipment, and a comfortable waiting area.

Digital Marketing: Improve your marketing efforts online like building your email list, social media accounts, text messaging, and your blog where you provide regular content that helps pet owners—the idea being to help your community first.

“Conducting a SWOT analysis helps identify strengths, weaknesses, opportunities, and threats, allowing practices to develop targeted marketing strategies that leverage their unique advantages.”
— VIS

Next Steps

Ready to get started? Here are 3 simple steps to kick off the process:

1. Grab Your Financial Docs
   Pull together all your financial papers: tax returns, profit and loss sheets, and anything that shows your practice’s money situation. Having these on hand now will save you tons of time later.

2. Look at Your Practice Like a Buyer Would
   Walk through your clinic. Does it look clean and modern? Is your team working smoothly? Make a quick list of things that could use some touch-ups, whether it’s new equipment or a fresh coat of paint.

3. Call an Expert for a Valuation
   Get a pro to tell you what your practice is really worth. Reach out to us today and set up a quick consultation. Knowing the value gives you a clear goal.

Here’s what our customers have to say about working with Transitions Elite?

“I had previously looked at selling the practice on my own, and I had talked to five different companies about this and had gone through the process individually, and none of it turned out to my satisfaction. After I signed up with Tom, he marketed me to these interested companies. There was competition amongst those interested. It was so relieving at the end of it to know that I got the very best deal possible!”

David Graeff, Cedar Rapids, Iowa

I knew that I would get the best value for my practice if I had a professional helping me. And it definitely turned out to be true that having Tom in my corner. 

I have zero doubt that I would not have gotten the value for my practice if I didn’t have him on my side as well as the ease of it. It was such an easy transition and he made the entire process very simple.

Sharon Gorman – Las Vegas, Nevada

 Just fill out the below form and book your free valuation call with our Experts Today!