It gives you the ability to control your destiny and create real wealth. Ownership ensures your efforts are fully reflected in your income and personal wealth.
But the process of buying a practice can be both complex and confusing. Equally, the decision of whether it is right for you and/or you are ready to make the jump to ownership is a difficult one.
Why buy a practice?
We have previously written in this blog about the benefits of buying an established practice.
The general consensus is that buying an existing practice is a much wiser option; both financially and in terms of risk. The practice will have known fee levels (presumably these will be transferable to you as the new owner – Check), a good and loyal client/patient base, a financial and cost structure which is both understood and works for you, and a sustainable future.
As a technically competent professional practitioner, you will have a good idea about the benefits and issues related to practice ownership. You may also have a good understanding of both the risks and opportunities that will come with practice ownership when compared to employment.
For some practitioners, ownership will enable you to develop your own style of practice, client/patient management and approach, specialisation, break away from corporate masters, etc. It creates the opportunity to manage your own schedule as well as build your own lifestyle.
Issues to consider when buying a practice
Making the decision to buy a practice is neither an easy one nor a small one.
It is complex because it requires personal insight as to whether you are ready to own. The transition from a good and competent practitioner to practice owner is a large leap into the unknown. Clinical or technical competence alone does not guarantee success.
In most cases, buying a practice is expensive and will also require significant borrowing.
Some of these questions are considered in the Medici Capital Ownership Ready Program (a seminar program designed to assist pharmacists in ensuring they are Ownership Ready – see http://www.medici.com.au/event/pharmacy-ownership-ready-series)
If you decide to buy, here are a few issues for you to consider:
- Understand your skills and experience to determine where and how you’ll achieve the best outcomes
Whatever your reason for buying a practice, you will need to understand your personal skills, experience, and competencies to assess the type of practice which will best suit you. - Think broadly about all your options
This may include in geographical as well as business size terms. It may also require consideration of your service delivery (i.e. electronic and web-based services as well as high street practice) - Understand it is a journey (not a destination)
In business terms, the ownership of a practice will commence a journey which may contain many pathways and opportunities. These may include expansion options, specialty practices, growth and constant changes to meet client/patients changing needs. - Your team and advisers
Any decision will also need to be supported by independent advice and due diligence. Ensure you have your advisory and analytical team in place early. It is also important that they understand you and your objectives. - Impact on you and your family
Consider the impact of ownership on you and your family. Practice ownership will have its challenges and pressures. It may also provide the opportunity to control your destiny and create wealth for you and your family.
Next week we will consider some further issues.
Consider the options available for you and use www.practice4sale.com.au to buy or sell a practice.
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