If you’re in the market to buy a new healthcare practice, you want to make sure it’s the right fit to add to your portfolio. At Crossroads Healthcare Transitions, we’re here to help you find the perfect practice for you. Here are some things to think about to ensure you’re buying the right healthcare practice.
Look at the Books
The bookkeeping is going to tell you the core information about the practice. You’ll see the money that the practice is bringing in and where the money they’re spending is going. It’s important to look at the business they’re doing and determine if it’s adequate and sustainable for where you want the practice to go.
You can also see how they’re paying their employees and whether that’s at the level you think it should be. If employees are unhappy, you’re going to experience a lot of turnover. Having employees that are happy and paid the way you believe you should be is crucial to keeping a sustainable practice. You need people that you can count on.
Lastly, think about how you would grow the practice. Do you see room to improve profits and be more successful? Does the practice model need to be changed? Is financial growth something that’ll be immediate or something you’ll have to be patient with? Is the staff older, with the most experience, but will be leaving sooner rather than later?
Analyze the Quality of Patients
No matter what, there are going to be patients that will leave when a new owner takes over the practice. This is something that you’ll have to accept. However, it’s important to be able to estimate that number. Is it something that’s going to be sustainable? Is the practice in an area where it’s going to be easy to recruit new patients?
If there are other people that provide treatment in the practice, will they be leaving with the owner? It’s important to try and determine the loyalty to the current staff. Are people going to definitely leave or is the location of the practice ideal and able to keep patients and gain more if the need arises?
Get an Independent Appraisal
While a seller will usually get a healthcare practice appraisal to determine an appropriate valuation of their practice. But it’s important that you get one as well. Bringing in a third party allows you to get more supplemental information without feeling like you’re irritating the seller. You want to get detailed information to ensure that this is an investment worth making.
However, a seller may also choose to disregard or forgo an appraisal on their end. They’ve poured their heart and soul into this practice. It’s natural that they may think their practice is worth more than it actually is. Getting an appraisal on your end helps to get a more impartial number to what it may be worth.
Find the Right Practice for You
The team here at Crossroads is ready to help you find the perfect practice to buy. Call us or schedule a call online!